Last year, the United States passed the Foreign Investment and National Security Act of 2007 (FINSA), which increases the power of the American President to block a foreign acquisition on national security grounds, said Han Fangming, a member of the 11th National Committee of the Chinese People's Political Consultative Conference, the top political advisory body.

Han, an investment banker, said it is necessary to set up an independent committee to standardize M&A procedures and block monopolistic acquisition.

"The committee, consisting specialists, scholars and other professionals from the industry, will also work to ensure only reasonable and constructive overseas investment projects are approved," he said.

Last August, China's legislators passed the nation's first anti-monopoly law, which requires national security checks for foreign companies seeking to merge with or take over Chinese enterprises.

Three months later, the country's planning agency, the National Development and Reform Commission, again identified sectors as restricted or off-limits to foreign capital, including "important and non-renewable" mineral resources and "strategic and sensitive" industries relating to the national economic security.

Chinese lawmakers are also considering a law to prevent state-owned assets from being sold too cheaply.

(Xinhua News Agency March 11, 2008)