US: Senator remains concerned over ChemChina-Syngenta deal

A powerful US senator said he is concerned that state-owned ChemChina, which is buying Swiss crop protection and seed group Syngenta for $43 billion, could use US sovereign immunity laws to shield itself from claims in US courts.

Some Chinese state-owned entities have argued that they have sovereign immunity and thus can’t be sued in US courts under the US Foreign Sovereign Immunities Act (FSIA) of 1976.

The acquisition by China National Chemical Corp (ChemChina) [CNNCC.UL] of Syngenta, the largest global investment by a Chinese company, won US regulatory clearance in August despite concerns from some lawmakers over US food security.

This week, a US congressional panel urged lawmakers to take action to ban Chinese state-owned firms from acquiring US companies.

In a Nov. 9 letter to US Senator Chuck Grassley that was posted on his website, ChemChina said its US-incorporated businesses are subject to US civil law, and that FSIA does not apply to commercial activity.

Grassley, who represents the US agricultural powerhouse state of Iowa, said in a Nov. 16 response that he remained concerned that ChemChina could seek to shield itself from US court jurisdiction.

“While ChemChina indicated that immunity would not extend to Syngenta’s US business, the company failed to note that immunity would otherwise apply to a wholly state-owned entity,” he said on his website.

Full Content: Reuters

Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.