Grassley Concerned ChemChina-Syngenta Merger Could Raise Questions about Immunity to US Laws

Jun 21, 2016

The proposed takeover of a major seed company by a Chinese government business is getting some scrutiny on Capitol Hill. U.S. Senator Chuck Grassley (R-Iowa) chairs the Senate Judiciary committee and says he's looking at state-owned ChemChina's plans to buy the Swiss company Syngenta.

Grassley says under U.S. law, a foreign government can ask for immunity in certain circumstances. But he says a commercial entity competing for business in the U.S. market, even if it's partially owned by a foreign government, should not be eligible for immunity.

"If the government's involved in it and it's a commercial activity, they can't seek immunity from our judicial process if somebody wants to sue 'em," Grassley says. "And that's the issue. Iowans and other farmers around the country ought to have their day in court."

Syngenta, which Grassley says earns about a third of its revenue in the United States, is currently facing lawsuits brought by farmers.

The senator says if Syngenta becomes part of a Chinese-owned enterprise, he doesn't want the new company to claim immunity from U.S. law because it's a part of a foreign government.

The proposed ChemChina-Syngenta merger comes amid other potential consolidations in the seed and agricultural chemical sector, with DuPont Pioneer poised to merge with Dow and Monsanto recently rejecting a takeover attempt from Bayer.