Foreign ownership: when hosts change the rules

Multinational corporations have consistently feared legislation that requires them to dilute their equity holdings in foreign subsidiaries. While foreign governments often view investment regulations as a means of gaining additional economic benefits, MNCs have perceived political pressure for more...

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Bibliographic Details
Published in:The International executive 1986-12, Vol.28 (1), p.10-11
Main Author: Encarnation, Dennis J.
Format: Article
Language:English
Subjects:
Dilution
Diversification
Equity
Foreign investment
Foreign subsidiaries
Host country
Multinational corporations
Politics
Regulation
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Summary:Multinational corporations have consistently feared legislation that requires them to dilute their equity holdings in foreign subsidiaries. While foreign governments often view investment regulations as a means of gaining additional economic benefits, MNCs have perceived political pressure for more national involvement as a form of creeping expropriation. In the best case scenario, this results in shared ownership and possibly managerial control; the worst case depicts a reluctant exit from the country.
ISSN:0020-6652
1522-709X
2375-0561
DOI:10.1002/tie.5060280103