On August 1, the Chinese Anti-monopoly Law (AML) was enforceable and four plaintiffs filed an anti-monopoly case in the No1 Intermediate People’s Court of Beijing. Some members of the media and laymen cheered it as the first anti-monopoly private litigation in China.

The plaintiffs were four anti-counterfeiting companies who sued the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ), an industry regulator. The original four plaintiffs were later joined by four other anti-counterfeiting Chinese companies from across the country . Claiming AQSIQ violated the AML, due to its efforts to popularize an online network.
 

The case spurred intense debate and optimism regarding China’s Anti-monopoly private litigation, and the media deemed it as a fantastic start to a long series of private litigation. However, the court cited a factor that the plaintiffs filed litigation after its validity period expired as the reason for turning down the case.

Under the AML, there are no detailed provisions regarding private litigation.Article 50 of the AML states:

"The business operators that implement the monopolistic conduct and cause damages to others shall bear the civil liability according to law."

However, through this simple provision, Chinese customers and competitors cannot get real compensation through private anti-monopoly litigation at the present time.

The reasons are diversified:

First, Chinese courts are not prepared deal with anti-monopoly civil cases. According to the internal arrangement of Supreme Court, No 3 Civil Division, which focuses on IP, have responsibility for anti-monopoly cases. Thus, Chinese judges lack the adequate experience in the field of anti-monopoly, and especially lack the ability to analyze microeconomics. In China, Chinese judges seldom put such knowledge and analytic approach into use. For most judges, monopolistic competition, oligopoly, transaction cost, game theory and contestable market are simply theoretical principles.

Secondly, there are many unsolved problems regarding AML enforcement. Traditionally, Chinese economics is based on central planning, the AML is unable to find strong foundation in such basis and competition law is quite strange to Chinese society.

If a Chinese judge faces an anti-monopoly civil case, their first challenge is in identify; opportunity, efficiency, justice, prosperity, harmony and freedom, which will be the prevailing value in Chinese ligation? Without a mature understanding of the AML, verdicts will conflict. Notwithstanding measurement of the concentration degree of the relevant market is a basic step for the AML, but there is no common understanding. Thus market share is not used as a standard in the concentration notification regulation. Therefore it is hard to imagine that Chinese courts could make a judgment before reaching agreement on basic ideas surrounding the AML.

Thirdly, according to the custom of the court, the Supreme Court should make an explanation on using the AML to guide lower courts. So far there has been no concrete announcement. Due to the absence of such explanation, a court cannot properly judge the scope of plaintiffs, the cause or calculate appropriate compensation.

Considering the reasons above, you can understand that suing monopoly power in civil cases is near impossible under the current framework.