This is an article corresponding to the China Mobile case which was discussed at China Law Vision on April 21, 2009. On 23 October 2009 the Beijing Dongcheng District People’s Court announced the settlement of an Anti-Monopoly Law (AML) case brought by Zhou Ze, an activist lawyer in Beijing, against China Mobile, China’s largest mobile network operator.

Zhou alleged that China Mobile abused its dominant market position (DMP) and engaged in illegal price discrimination activities by charging additional monthly fees for services that he, as a subscriber, was not using. Zhou sought 1,200 yuan in compensation (an amount equal to his basic mobile fees for the last two years), and for China Mobile to stop charging its subscribers such fees. Consequentially,the state-owned giant agreed to pay Mr. Zhou 1,000 yuan ($146) to settle his claims over mandatory fees.


The fact that the case was ultimately settled and that the uncertainty as to how the AML will be applied in practice remains, is of great importance to individual consumers with private actions against prominent business operators in China, and to other parties who have made claims under the AML (including those who have brought similar discriminatory pricing cases against state-owned enterprises).

One should attempt to understand the reasoning behind the settlement of the case. It is likely that in making such a decision, China Mobile took into account of the uncertainties in the application of the AML. Moreover, as a state-owned enterprise (SOE), while certain Articles of the AML has been interpreted to exempt state-owned enterprises (SOEs), it may be argued that the AML may be interpreted as exempting China Mobile from the AML prohibitions. Therefore, China Mobile’s willingness to settle the case may indicate that it considers its consumer pricing activities to be outside the scope of such exemptions. Hence, the consequences of a defeat for such a prominent company was likely to have been considered by China Mobile, namely that it could lead to a regulatory investigation and a fine of up to 10 per cent of its business turnover, and more importantly, potential major damage to its brand and ‘floodgate’ opening for similar claims.

Going forward, it is hoped that such cases may urge the Chinese courts and regulatory authorities to finalize and implement certain AML procedural rules to increase the transparency in the application of the law, and the certainty in the hearing and investigation of AML claims.