Authored by Dr. Zhan Hao (zhanhao@anjielaw.com)
On 4th May, 2012, the People’s Supreme Court issued the Regulations on Several Issues Concerning the Application of Law in relation to Trials of Monopoly Civil Disputes arising from Monopolistic Conducts (The “Judicial Interpretation”). This new Judicial Interpretations of Anti-Monopoly Law will take effect on 1st June, 2012. As the first issued judicial interpretation on the field of Anti-Monopoly law, it began to be drafted early since 2009. On 25th April, 2011, the People’s Supreme Court of China released the Draft version of the Judicial Interpretation to solicit public comments. Based on various public opinions, the official Judicial Interpretation freshly baked is different from the Draft version in some facets to some extent.
It is a fact that since 1st August 2008, when the Anti-Monopoly Law of PRC came into force, civil monopoly dispute cases have gradually become a very important type of lawsuits of People’s Courts. According to the Supreme Court’s records, as of the end of 2011, local courts in China have accepted 61 civil actions as courts of first instance under the Anti-Monopoly Law and have closed 53 of them. However, the civil monopoly dispute cases are normally difficult and complicated for the court proceedings whether in terms of anti-competitive agreements or abuse of dominant position. legal problems in such cases usually closely intertwine with economic data and analysis. Good understanding of specific field of economy is necessary with the view to analyze monopoly dispute cases. Indeed, some provisions of the Anti-Monopoly Law are highly principled and abstract. Provisions that refer to the operation of the People’s Court are stipulated relatively simple. Therefore, the issue of the Judicial Interpretation undoubtedly has a significant influence on the practical operation of the People’s Courts.
The Judicial Interpretation stipulates various provisions such as filing the lawsuit, jurisdiction, plaintiff qualification, burden of proof, civil liability and relationship between public enforcement and private litigations, etc. They established a basic framework for the anti-monopoly private proceedings. In the following some details of the Judicial Interpretation will be illustrated with the hope to shed some light on the readers.
1. The Qualification of Plaintiff
Who can file the civil monopoly lawsuit? Not only the counterparties to the undertakings, who implement a monopolistic agreement or abuse their market dominant position, but also the purchasers may be harmed directly or indirectly by monopolistic conducts. Article 1 of the Judicial Interpretation provides that the natural person, legal person or other organizations can file a suit for the losses coming from the monopoly and the violation against the Anti-Monopoly law by the contract or the rules of industry associations. Nevertheless, the issue of whether consumers are vested plaintiff qualification is still not very clearly articulated.
2. Two ways of filing the suit
In Accordance with Article 2 of the Judicial Interpretation, the plaintiff can file suits directly to the Court and also have the choice to file the lawsuit after antitrust enforcement authorities’ decisions on the determination of the monopoly conducts become effect.
3. Jurisdiction over civil monopoly dispute cases
In Article 3 of the Judicial Interpretation, the principle of centralized jurisdiction is further clarified, namely, civil monopoly dispute cases of the first instance usually shall be heard by intermediate courts of the capital cities of the provinces and autonomous regions, of the municipalities directly under the central People’s government, of the cities under state independent planning and the intermediate courts designated by the Supreme People’s Court. Besides, by approval of the Supreme People’s Court, some basic People’s Court can also have jurisdictions on the monopoly disputes cases as the first instance court.
4. Burden of proof
The Judicial Interpretation distinguishes different types of monopolistic behaviors in provisions on burden of proof.. For specific horizontal monopoly agreements that seriously eliminate or restrict competition, the defendant shall undertake the burden of proof; For the cases of abuse of dominant market position by public enterprises as well as other operators with exclusive business qualification, the Judicial Interpretation has appropriately reduced the burden of proof for a plaintiff in a civil lawsuit.