The German government is considering a plan to create a new regulatory body to protect key industries from takeover by investment funds controlled by foreign governments.
The move is prompted by growing fears in Germany of cash-rich Chinese or Russian funds swooping on blue-chip companies like Deutsche Telekom or Deutsche Bank.
A spokesman for the German finance ministry confirmed that inter-departmental talks are under way in Berlin, prompted by recent business developments. Last month the Emirate of Dubai took a 2.2 per cent stake in Deutsche Telekom, the former German state telecoms monopoly. At the same time, China spent $3 billion (€2.2 billion) to buy into the Blackstone investment group, itself holder of a 4.5 per cent stake in Telekom.
That deal cost the Chinese just 0.3 per cent of their reserves, according to German finance minister Peer Steinbrück. "What happens when they use 10 or 20 per cent of their reserves?" he asked last week.
Nervousness is growing in German business circles at huge cash reserves of oil-rich nations like Russia and the Gulf states, as well as China's $1.2 billion pile of US and European state bonds.
A recent study by Morgan Stanley estimated the total worth of Russian, Chinese and Middle East state-controlled funds at more than $2,500 billion.
"We are watching very closely how state-controlled companies from Russia, China and the Middle East are buying shares in companies or buying them outright," said Thomas Mirow, state secretary at the finance ministry to the Handelsblatt newspaper.
But he said it was too early for state action and rejected the suggestion of a "strategic attack" on German companies.
"Germany does not have such mechanisms as in the US or France," said Ulrich Wilhelm, the government spokesman. "As yet there are no findings whether Germany requires these regulations."
A new regulatory organisation, if created, is expected to resemble the US Committee on Foreign Direct Investment, created in the 1980s to examine the national security implications of foreign acquisitions of American companies.
That organisation, chaired by the US Treasury, existed in relative obscurity until 2005 when it examined and eventually approved the takeover of IBM's personal computer division by China's Lenovo; in the same year it rejected a Chinese takeover of Californian oil company Unocal.
Last yearit rejected the planned acquisition by a Dubai consortium of P&O, operator of several US ports including New York.
