Authored by Dr. Zhan Hao (

With the year of 2013 approaching, MOFCOM held a press conference specific on “anti-monopoly work progress in 2012” on December 27, 2012. Shang Ming, the Director General of MOFCOM Anti-monopoly Bureau and Anti-monopoly Committee of the State Council gave a briefing on the legislation and enforcement progress of antitrust review on concentrations and answered questions from reporters.

In this occurrence, four issues are mainly involved and they are: (1) supporting legislation of antitrust review on concentrations; (2) law enforcement of antitrust review on concentrations; (3) international cooperation carried out by MOFCOM; and (4) propaganda and training carried out by MOFCOM.

Supporting Legislation

According to Mr. Shang’s introduction, there are eight concentration-related supporting regulations or guidelines have been enacted between 2008 and 2011 in all. In the passing 2012, MOFCOM mainly focused on proceeding supporting legislation in two aspects. One is rules on imposing conditions on concentrations, before which MOFCOM issued the Interim Provisions on Asset or Business Divestiture in Concentration between Undertakings in 2010. With the target to summarize experience in implementing this Interim Provisions and address discovered problems, MOFCOM decided to enact a new legislation to make a full range of regulation on the proposal, assessment, implementation, supervision, modification of conditions on the concentration as well as the liability issue.

The second legislation project in 2012 is Provisions on Applying Summary Procedure in Concentration cases, which is intended to increase the efficiency of law enforcement. Indeed, it sees a tendency of gradually increased concentration notification cases. According to statistics, 16 cases are concluded in 2008, 78 cases in 2009, 109 cases in 2010 and 171 cases in 2011. 2012 would see an approximately same amount of concluded concentration cases with 2011. In this connection, therefore, without a fast-track procedure for conducting antitrust review on concentrations, the enforcement authority would have difficulty in focusing on significant and complicated cases.

Law Enforcement

First, in Mr. Shang’s briefing, MOFCOM received 201 concentration notification cases, officially accepted 186 cases and concluded 154 cases of them in total up until 26th December, 2012. Among them, 6 were approved with conditions, 6 were revoked after being officially accepted and 142 cases were approved without any condition, which account for 92% of all concluded cases. It is estimated by MOFCOM that the case number in 2013 and 2014 would still stable around 200.

Second, MOFCOM made an analysis on the concentration method, nature and involved industry based on data up to the end of November 2012. Regarding the concentration method, a major proportion of concentrations adopted the method of equity acquisition. For example, there are 101 cases relating to equity acquisition (62% of concluded cases) in 2011; there are 49 concentrations by way of establishing joint venture (30% of concluded cases) in 2011. In 2012, 71 concentration notifications involve equity acquisition (55% of concluded cases) and 46 concentration notifications involve establishment of joint venture (36%) until the end of November. With respect to nature of concentration cases, the majority cases are horizontal concentration between competitors. In 2011 there are 97 horizontal concentration cases, 13 vertical concentration cases and 42 conglomerate concentration cases have been notified with MOFCOM, which account for 60%, 8% and 26% respectively. Up until November of 2012, the number of horizontal concentration cases is 80, accounting for 65% of all. From the perspective of involved industry, most of concentrations happened in manufacturing industries, including petroleum, chemical, mechanical manufacture, automobile, shipping, aircraft, mining, etc. In 2011 the number of concentrations in manufacturing, IT, wholesale and retail industry is 107, 13, and 12 respectively. There are 74 concentrations in manufacturing industry, which is slightly lower than in 2011.

Third, another attractive phenomenon is that 2012 is witnessed as the year that conditional approvals are issued most by MOFCOM since the Anti-Monopoly Law entered into force in 2008. The number of conditional approval from 2008 to 2012 is 1, 5, 1, 4 and 6 respectively.

Fourth, MOFCOM has achieved breakthrough in terms of information disclosure. Since the Anti-Monopoly Law entered into force in 2008, MOFCOM has been continuously making efforts on information disclosure. According to Mr. Shang’s briefing, Anti-Monopoly Law only requires MOFCOM to publicize conditional approvals and forbidden decisions. In order to increase the transparency of law enforcement, nevertheless, MOFCOM disclosed all approved cases without any condition on the website of MOFCOM Anti-Monopoly Bureau from August 2008 to September 30, 2012, which are 458 cases in total. The disclosed information contains case name and the concentration parties. “We will disclose by quarterly summery hereafter. In the current stage, disclosed information is only limited to case name and concentration parties. Whether additional information would be disclosed later is still under discussion.” Mr. Shang said.

Fifth, Mr. Shang also talked about the issue of investigation on un-notified concentrations. According to his introduction, up until now, MOFCOM received 3 reports, two of which have been verified. “Two transactions have not been implemented; therefore, we urge the enterprises to notify as soon as possible. The other one is still under examination of report materials.” Mr. Shang said.

International Cooperation

In this press conference, Mr. Shang also emphasized the significance of cooperation with the antitrust authority in other jurisdictions. With economic globalization and capital flow over the world, a lot of mergers and acquisitions are cross-border; therefore, communication and cooperation between antitrust enforcement authorities in different countries are very necessary. Currently, MOFCOM has established cooperation mechanism in different levels with U.S., EU, the Great Britain, and South Korea. Besides, MOFCOM also have participated some multi-level cooperation, such as international conferences organized by Competition Expert Group of UNCTAD and international antitrust conference organized by APEC.

Propaganda and Training

In the briefing, Mr. Shang admitted that the competition culture in China is relatively weak given that the Anti-Monopoly Law of PRC is still young. In the more than 4 years since the Anti-Monopoly Law entered into force, MOFCOM has spared no efforts to conduct propaganda work. In order to improve enterprises’ and the public’s awareness of antitrust laws, MOFCOM organizes a series of activities to propaganda antitrust laws in diverse forms every year. “Generally speaking, the training and propaganda work for antitrust law will still be our focus in the future period.” Mr. Shang summarized.