Authored by Dr. Zhan Hao (email@example.com)
On May 19, 2012 MOFCOM confirmed the conditional approval of Google’s purchase of US phone maker Motorola Mobility.
On August 15, 2011 Google and Motorola Mobility signed a purchase agreement, under which Google would acquire all shares of Motorola Mobility, which would then become a wholly owned subsidiary of the former. Thereafter, on September 30, 2011, MOFCOM received the notification regarding the concentration of undertakings through Google’s purchase of Motorola Mobility. Different aspects were reviewed by the relevant authority, such as the relevant market, free use of Google’s mobile software, Android, treatment of original equipment manufacturers by Google, Motorola’s patent obligations and market entry. However, the main aspect MOFCOM focused on when evaluating the concentration was its influence on competition within the relevant market.
With respect to the influence the concentration could exercise upon the relevant market, MOFCOM pointed out that it may affect competition by means of eliminating and restricting it. In order to solve the aforesaid issue MOFCOM engaged several rounds of talks. As a result, on May 15, 2012 Google submitted a final commitment on how to solve any competition issue thereby. After its evaluation, MOFCOM states that Google’s commitment could reduce the adverse effects of the concentration on competition, and, therefore, the concentration was approved.
According to the final commitment, which Google should fulfill the following obligations:
1. Google shall provide Android on a “free and open basis”.
2. Google shall treat all original equipment manufacturers on a non-discriminatory basis.
3. Google shall continue to comply with Motorola’s current fair, reasonable and non-discriminatory patent obligations.
4. Google shall appoint an independent superintendent to monitor and supervise the fulfillment of these obligations.
Conditions 1 & 2 are binding for a five-year period. Nevertheless, should market conditions have changed Google could ask for their modification or rescission. The superintendent’s report must be submitted to MOFCOM every six months. After expiration of the five-year period, MOFCOM may still monitor the situation and take any necessary decision according to market conditions.