The Anti-monopoly Bureau of the State Administration for Market Regulation recently published the Guidelines on Leniency for Horizontal Monopoly Agreements. The guidelines propose a relatively reliable leniency system under the Anti-monopoly Law, which is of great significance for improving the effectiveness of antitrust enforcement, while providing a valuable source of guidance for Chinese market players to follow.
China's antitrust agency's greatest competition concerns in the automobile sector relate to vertical restraints. Possibly underscoring this concern, the newly published Antitrust Guidelines on the Automobile Industry placed its main focus on clarifying issues arising therefrom. To help companies in the automobile industry better make their own assessments on antitrust compliance in China, this article explains the antitrust rules relating to vertical restraints provided in the guidelines and analyses their implications.
Alongside increased administrative action, Chinese companies increasingly bring private antitrust actions against rival companies, particularly in the technology sphere. These suits are often accompanied by an administrative complaint that can lead to investigations and penalties. This article clarifies China's hybrid antitrust system in order to better understand the antitrust risks facing foreign enterprises in China.
China's merger review practice has not been negatively affected by the COVID-19 outbreak. According to public statistics, in the first quarter of 2020 the State Administration for Market Regulation (SAMR) completed 111 filing reviews, with a slight year-on-year growth of 0.9%. The current economic downturn raises the question of whether the SAMR will relax its antitrust scrutiny to encourage M&A activity. However, recent merger review practice in China suggests that this has not been the case in the semiconductor sector.
The year 2019 marked the 11th anniversary of the implementation of the Anti-monopoly Law and was also the first full calendar year since the State Administration for Market Regulation (SAMR) became China's single centralised antitrust enforcement agency. Evidently. the SAMR has become more stringent and detail oriented with respect to the analysis of relevant markets and the competition impact of mergers.
The State Administration for Market Regulation (SAMR) recently published the Draft Amendment to the Anti-monopoly Law (AML) for public comment. The draft amendment demonstrates the SAMR's strong stance on monopoly behaviour and is based on 12 years of antitrust enforcement. It conveys to the public that the Chinese authorities will strengthen enforcement relating to monopoly conduct. This article provides a summary of the draft amendment's main changes and the practical implications thereof.
The State Administration for Market Regulation recently released a revised draft of the Anti-monopoly Law (AML) for public comment. In general, the revised draft follows the current AML's basic framework; however, it significantly enhances the legal liability of AML violators. This article highlights key changes proposed by the revised draft and discusses why these changes matter for business entities from a practical point of view.
China's antitrust enforcement agencies were reorganised in 2018. As such, new legislation and enforcement actions in 2019 attracted significant attention from practitioners and in-house counsel, with a view to gaining an insight into the new agency's enforcement trends and priorities (if any). This article underlines the most significant developments in legislation, public enforcement and private litigation in 2019.
The topic of whether antitrust civil disputes are arbitrable has been hotly debated in China in recent years. There are few case law precedents in this regard and local courts have taken different positions regarding this issue. That said, the Supreme People's Court made its stance clear in a recent decision which found that an arbitration clause could not exclude the jurisdiction of Chinese courts in antitrust civil disputes.
A violation of the notification or standstill obligation is commonly called 'gun jumping' and can have significant legal consequences. This article examines Canon's acquisition of Toshiba Medical and the legal consequences of gun jumping in China, as well as the risks of implementing a transaction 'by steps' to circumvent the standstill rules. Recent strengthened enforcement measures are also briefly examined.
The State Administration for Market Supervision recently promulgated the Interim Provisions for Prohibiting Monopoly Agreements. Although the draft provisions introduced a safe harbour clause for non-IP-related monopoly agreements, this has been removed from the final version. As debate continues as to whether to introduce a safe harbour clause to Chinese legislation, this article examines the history of the safe harbour rule and the potential reasons why it would not apply to all monopoly agreements.
The Ministry of Commerce of China recently announced the establishment of an Unreliable Entity List (UEL) targeting foreign entities and individuals that (among other things) fail to comply with the principles of the market economy or threaten China's national security. It is anticipated that the UEL will rely heavily on the Anti-monopoly Law, especially in relation to foreign entities with a noticeable market presence in China.
The Shanghai Market Regulation Bureau (SMRB) recently issued a penalty decision addressed to Eastman (China) Investment Management Co, Ltd, a Chinese subsidiary of US Chemical firm Eastman Chemical Company. Since this is the first antitrust enforcement decision to be issued by the SMRB since its establishment, it has drawn significant attention from commentators who have attempted to identify the bureau's enforcement approach.
Although still fairly new, the State Administration for Market Regulation (SAMR) diligently investigated and penalised monopolistic behaviour in 2018, publishing a dozen cases alongside its local enforcement agencies which attracted media attention. Notably, livelihood-related industries (including the pharmaceutical industry) and trade associations appeared to come under the SAMR's spotlight.
The National People's Congress recently passed and published revisions to the Anti-unfair Competition Law. The revisions focus primarily on trade secret infringement, as trade secrets are regarded as one of the core competitive advantages in today's business world. The main amendments include widening the definition of 'infringer', increasing penalties for infringement and alleviating the burden of proof for plaintiffs.
The refusal of the Chinese antitrust authority to green light the Qualcomm/NXP merger garnered significant attention and shone a spotlight on China's merger review practice, particularly with regard to the chip industry. This article provides an overview of Chinese merger control by examining the major chip industry mergers that the former Ministry of Commerce and the current State Administration for Market Regulation have approved with remedies to date.
In 2018 the newly formed State Administration for Market Regulation (SAMR) maintained a rigorous and prudent attitude towards merger control review. There was a significant increase in the number of cases concluded and the efficiency with which they were done so. As regards the cases which were conditionally approved, the SAMR imposed various tailored conditions. In addition, the SAMR investigated more non-filing cases and imposed more penalties on non-filers compared with 2017.
China reached a number of Anti-monopoly Law enforcement and development milestones in 2018. For example, the newly established State Administration for Market Regulation completed the consolidation of the country's former government antitrust agencies and amended a number of Anti-monopoly Law regulations. Although this institutional reform took a significant amount of time, public enforcement remained active. In addition, there were a number of private antitrust enforcement developments.
The newly established State Administration for Market Regulation recently embarked on its first major overhaul of procedural rules by publishing the draft Interim Provisions on Administrative Penalty Procedures in Market Regulation and the related interim measures for public comment. Unsurprisingly, market observers and practitioners promptly examined the draft documents in an attempt to deduce any changes to the intended-to-be-repealed State Administration for Industry and Commerce rules.
The Shenzhen Intermediate People's Court recently issued its judgment in the private antitrust litigation brought by domestic software company Shenzhen Micro Source Code Software Development Co Ltd (SMSCSD) against tech giant Tencent. SMSCSD had alleged that Tencent possessed a dominant position in the China mainland market for mobile instant messaging and social platform services and had abused this dominance by blocking its WeChat Official Accounts and engaging in discriminatory practices.