Competition Law/ Anti-Monopoly Law

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I focus mainly on two legal areas: insurance law and anti-monopoly law. Both these two areas experienced a dramatic progress in 2009. In my personal practice, I see some interesting overlapping of these two areas. In this article, I will address two cases in vehicle insurance market regarding the accusation of violation of China Anti-Monopoly Law (AML).Continue Reading Two Antitrust Cases in Insurance Law Area

On 25 January 2010, European Commission said that it is ready to review a plan by the world’s second and third largest iron ore miners, Rio Tinto and BHP Biliton, to combine some iron ore mining operations in Australia. The European antitrust watchdog said that it would investigate whether the companies’ plan to pool iron ore mining in western Australia would affect the global prices or supply for iron ore transported by sea, known as seaborne iron ore. The Commission set no deadline for completion of the investigation, citing the complexity of the case, cooperation from the companies involved and exercise of the rights of defense, among other factors, to justify the open-ended time limit. Continue Reading Will Rio Tinto and BHP Billiton Make It This Time? A Few Comments From The Perspective Of Antitrust Law

On January 8th, the China Publishers Association（中国出版工作者协会），the China Book Distribution Industry Association（中国书刊发行业协会）and the China Xinhua Bookstore Association（中国新华书店协会）(collectively the “Three Associations”) jointly published the “Book Fair Trade Rules” (“BFTR”). Its enactment generated widespread outcry at its suspected violation of China’s Anti-Monopoly Law (“AML”). BFTR became effective upon its release. Continue Reading Chinese Readers Upset Over No-Discount Rule

This article appeared in the 3rd edition of The International Comparative Legal Guide to Cartels and Leniency 2010; published by Global Legal Group Ltd, London(www.iclg.co.uk)

You can aslo download a bookmarked PDF version of this guide book at the following link:

http://www.iclg.co.uk/index.php?area=4&show_chapter=3380&ifocus=1&kh_publications_id=128

 1     The Legislative Framework of the Cartel Prohibition

1.1 What is the legal basis and general nature of the cartel prohibition, e.g. is it civil and/or criminal?

The principal legal basis for cartel prohibition is the Anti-Monopoly Law (AML) and the Price Law (Price Law). At the time of writing, two of China’s antitrust enforcement authorities—the State Administration for Industry & Commerce ( SAIC) and the National Development and Reform Commission (NDRC)—have also promulgated a series of implementing regulations for public comments: the Draft of the Regulations on Prohibiting Monopoly Agreements (SAIC) and the Draft of the Regulations on Prohibiting Price Monopoly (NDRC).

In China, violation of cartel prohibition carries administrative as well as civil liabilities. No criminal liability is provided for cartels in China. Continue Reading China Chapter:The International Comparative Legal Guide to: Cartels & Leniency 2010

On December 18, 2009, Beijing No.1 Intermediate People’s Court (the “Court”) reached a decision in favor of defendant in China’s second “abusing dominant market position” case.

BACKGROUND

The Plaintiff, Tangshan Renren Information Service Company (“TRISC”) operates an online platform that brokers deals between pharmaceutical companies and distributors and consumers. The Defendant, Baidu, which is allegedly the largest Chinese search engine company is accused of artificially lowering TRISC’s ranking in Baidu search results in order to coerce TRISC into continuing to purchase bid ranking service from Baidu. It is alleged to have caused TRISC to lose traffic and revenue. TRISC brought the case to the Court under Paragraph 1 of Article 17 of Chinese Anti-Monopoly Law (“AML”), namely, the exclusive dealing provision that prohibits a firm with market dominance position from restricting a third party to dealing with itself or selected third parties exclusively without valid justification. TRISC petitioned the Court to grant an order to enjoin Baido from the conduct and asked for $163,000 in damage for lost revenues. Baidu defended itself by arguing that lowering TRISC’s ranking in its search result was a response to the “junk links” practice TRISC engaged in, i.e. TRISC created a robot to automatically post junk posts on websites and forums and sent out spam messages to elevate its ranking in Baidu’s search results. According to Baidu, it adopts “anti-junk links” policy and made it sufficiently clear to the outside world by putting it on its website. Continue Reading Second Chinese “Abusing Dominant Market Position” Case Decided

Last week, Rio Tinto, a resource giant of Australia, withdrew its proposed transaction with China’s Chinalco, and announced that it will set up a joint venture with another rival miner, BHP Billiton. If the Rio Tinto – BHP Billiton deal is finished, as analysts estimated, there will be a great concert effect, because they will be able to share their ports and railroads in Western Australia, which considerably cuts costs for both parties.Continue Reading The Extraterritorial Enforcement of China Anti-monopoly Law

On June 05, 2009, the State Administration for Industry and Commerce (SAIC), one of the three enforcement agencies for China’s Anti-Monopoly Law (AML), released two sets of provisions on the procedures to be followed by the agency and its delegates when enforcing the AML. They are: Procedural Provisions on Stopping the Use of Administrative Power to Exclude or Restrict Competition and Procedural Provisions for Investigating Monopoly Agreement and Abuse of Dominant Position Matters. These two provisions will come into effect on July 01, 2009. On June 08, 2009, SAIC published a Set of Questions and Answers about the Two Procedural Provisions on its website, which provides answers and explanations to some of the more pressing issues.Continue Reading Comments on the Recent Procedural Provisions Promulgated by SAIC

Last month, nearly all domestic airline companies in China raise their price simultaneously. However, they denied that their decision based upon agreement between them. On 04.27.2009, SAIC promulgated the Draft Regulation on Prohibition of Monopoly Agreements and the Draft Regulation on Prohibition of Abuse of Dominance. The two drafted regulations offer detailed instruction and important amendments on how to regulate monopoly agreements and abuse of dominance.

Continue Reading New Trend Regarding Price Fixing Agreements in Aviation Industry

Currently, there is an absence of legislation in China concerning gun jumping in the context of mergers and acquisitions. However, the Anti-monopoly Law (AML) could potentially be utilized as mode to curb and or prohibit gun jumping in the future. The following will attempt to analyze how the AML may be used in relation to gun jumping in the future.

Continue Reading CHINA: “Gun Jumping” and the Anti-monopoly Law (AML)

Last week, SAIC promulgated two draft regulations relating to China’s Anti-monopoly Law. The new regulations concern abuse of dominance and monopoly agreements.

A prohibition on anti-competitive monopoly agreements and a prohibition against the abuse of market dominance are two of AML’s main prongs; the third being a review of concentration. However, under the AML, the provisions of these two categories lack detail as they are only covered through the broad principles of China’s competition law. Hence, the new draft regulations are welcomed as a mode to increase the detail of and to further develop China’s competition law. Furthermore, substantial private litigation has emerged challenging the abuse of dominance and monopoly agreements. Therefore, SAIC’s promulgation of the two drafts is a welcomed response to this rising trend.
 Continue Reading New Draft SAIC Regulations: Positive Affects for the AML