ABSTRACT
This chapter discusses the concepts of foreign influence and control in relationship to foreign equity ownership restrictions. In 1984, five of the ten countries had general restrictions on the percentage of foreign ownership permitted within each business entity, although exceptions could sometimes be negotiated. India restricted foreign ownership to a maximum of 40 per cent; the Philippines had a 60 per cent limit; The Republic of Korea had a 49 per cent limit; and Morocco limited foreign ownership to less than 50 per cent. As with international trade, foreign direct investment leads to some degree of loss of control by host country governments over their economies. Equity ownership restrictions - and government ownership of a portion of the enterprise, in particular - may be seen as a way of disseminating information about the enterprise's operations. There has often been an element of nationalism involved in equity ownership restrictions.
