Competition & Antitrust, China updates

Shifting alliances under Chinese merger control regime
AnJie Law Firm
  • China
  • May 17 2018

The Ministry of Commerce recently promulgated the Measures for the Review of Concentrations of Business Operators (revised draft) for consultation. However, the revised draft still lacks provisions on the shifting alliances concept. The relevant Anti-monopoly Law enforcement agencies should consider this concept in future, as acknowledging it at the legislative level will finally place China's antitrust system among those of the world's most advanced anti-monopoly jurisdictions.

Anti-monopoly Law enforcement against collective boycotts
AnJie Law Firm
  • China
  • May 10 2018

The Anti-monopoly Law enforcement agencies are increasingly investigating and finding fault with collective boycotts among competitors. As the presumption of illegality for collective boycotts requires a high level of compliance, businesses should be aware that although an independent decision not to deal with distributors or suppliers may not raise Anti-monopoly Law concerns, an agreement with competitors not to do so could raise such concerns.

How will merger of antitrust enforcement agencies affect Anti-monopoly Law enforcement?
AnJie Law Firm
  • China
  • April 19 2018

The State Council recently submitted a proposal to the National People's Congress concerning the council's institutional reform programme. The proposal has shed light on the plans to consolidate the antitrust enforcement powers of the three antitrust agencies under the State Administration for Market Supervision. Although the merger is significant in terms of institutional reorganisation, it will not fundamentally change Anti-monopoly Law enforcement activities in China.

NDRC antitrust enforcement in 2017
AnJie Law Firm
  • China
  • April 12 2018

In 2017 the National Development and Reform Commission actively carried out legislative work and formulated and promulgated industrial guidelines and enforcement procedures. In addition, it remained active in its antitrust enforcement by not only penalising a variety of enterprises for anti-competitive conduct, but also targeting administrative agencies that had abused their administrative power in order to restrict or eliminate competition.

Pharmaceutical companies face harsher antitrust compliance challenges
AnJie Law Firm
  • China
  • January 18 2018

The National Development and Reform Commission recently released price conduct guidelines for business operators active in the drugs prone to shortages and active pharmaceutical ingredient (API) markets. The guidelines strengthen the API market's price supervision mechanism, clearly regulate market pricing behaviour with regard to drugs prone to shortages and APIs and provide practical guidance for relevant pharmaceutical companies with regard to their pricing behaviour.

Competing fairly in the digital age – implications of new Anti-unfair Competition Law
AnJie Law Firm
  • China
  • December 21 2017

The National People's Congress Standing Committee recently passed the long-awaited amendments to the Anti-unfair Competition Law, which will take effect in January 2018. This is the first time that the law has been amended and it will have a significant impact on business practice in China. In particular, the amended law includes a new section addressing internet-related unfair competition and offers practical and clear guidance for business operators on how to compete legally and fairly online.

NDRC hints at SEP pricing guidance to enhance Anti-monopoly Law compliance
AnJie Law Firm
  • China
  • November 09 2017

At the recent China Competition Policy Forum, a Price Supervision and Anti-monopoly Bureau official commented on the potential enactment by the National Development and Reform Commission (NDRC) of regulations on standard-essential patent licensing practices. The NDRC's proposal aims to ensure greater consistency with the Anti-monopoly Law and develop a consistent approach to the enforcement of IP rights-related anti-competitive conduct.

Refusal to deal: a review of Yunnan Ying Ding v SINOPEC
AnJie Law Firm
  • China
  • October 12 2017

Following the recent final judgment of the Yunnan Province Higher People's Court, the curtain has – for now – fallen on the Yunnan Ying Ding v SINOPEC refusal to deal case. This case is unique for several reasons. Among other things, it is reportedly the first antitrust dispute to involve the Chinese petroleum industry. In addition, it is the first case in which the plaintiff's claims have concerned refusal to purchase.

Rational approach to abuse of collective dominance in antitrust law
AnJie Law Firm
  • China
  • September 28 2017

The National Development and Reform Commission recently penalised two Chinese pharmaceutical undertakings for alleged collective abuse in the isoniazid active pharmaceutical ingredient market. This was the first time that the Chinese enforcement authorities applied the rules of the Anti-monopoly Law to a case concerning collective abuse.

Decoding exposure draft of MOFCOM's amendments to antitrust review rules
AnJie Law Firm
  • China
  • September 21 2017

The Ministry of Commerce (MOFCOM) recently released an exposure draft of the amendments to its Provisions on the Antitrust Review of Concentrations for public comment. The amendments aim to improve the functionality, comprehensiveness and quality of the provisions by incorporating MOFCOM's experience and its existing best practices. In general, this move to amend the provisions is praiseworthy. However, several issues will need to be resolved through the public consultation process.

Anti-monopoly enforcement trends in healthcare industry
AnJie Law Firm
  • China
  • September 14 2017

The healthcare industry has gradually become a key focal point of Anti-monopoly Law enforcement in China. Between the implementation of the law in 2008 and the end of July 2017, the National Development and Reform Commission and the State Administration for Industry and Commerce concluded a number of anti-monopoly penalty cases and accumulated significant industry experience. As such, healthcare enterprises are likely to face increasing anti-monopoly compliance challenges in future.

Guidelines on Trade Association Pricing Activities – a member's perspective
AnJie Law Firm
  • China
  • September 07 2017

The National Development and Reform Commission recently published its Guidelines on Trade Association Pricing Activities. The guidelines clarify trade associations' different pricing activities and categorise them according to their associated level of legal risk. As the guidelines advise associations on how to carry out their activities, they will have a direct impact on legal risk assessments and the day-to-day business of trade associations and their members.

Deregistration: trade association receives severest antitrust punishment
AnJie Law Firm
  • China
  • August 03 2017

In a recent Zhejiang Provincial Price Bureau case, 17 paper manufacturers were fined a total of Rmb7.78 million for reaching and implementing a horizontal monopoly agreement. Further, the price bureau ordered the Fuyang Paper Manufacturers Association, which had played a leading role in organising and facilitating the conspiracy, to be deregistered. This is the first time that a Chinese antitrust authority has invoked Article 46(3) of the Anti-Monopoly Law to deregister a trade association.

Special evidential rules for antitrust-related civil litigation
AnJie Law Firm
  • China
  • March 30 2017

The evidential rules that apply to litigation in certain jurisdictions, especially those regarding the allocation of the burden of proof, have a significant impact on the ultimate result of a case. Private antitrust litigation is often highly complex and thus puts the plaintiff at a disadvantage. However, since special evidential rules were introduced in 2012, the success rate of plaintiffs in private antitrust litigation has started to increase.

Tetra Pak receives SAIC's severest antitrust penalty
AnJie Law Firm
  • China
  • January 19 2017

After a nearly five-year investigation, the State Administration for Industry and Commerce (SAIC) recently concluded its Tetra Pak case. In a landmark decision, the SAIC imposed its largest ever antitrust penalty on the Swiss packaging giant for its abuse of a dominant position in China and ordered it to cease its illegal conduct. The SAIC's innovative approach to assessing unspecified monopolistic behaviour is a milestone in antitrust law enforcement and its decision will serve as a valuable precedent.

China intensifies pharmaceutical antitrust enforcement: NDRC rules in first-ever concerted practice case
AnJie Law Firm
  • China
  • October 13 2016

Enforcement in the pharmaceutical industry has been relatively weak since the Anti-monopoly Law's implementation in 2008. However, the National Development and Reform Commission (NDRC) recently issued a decision in the first Chinese case to involve a cartel established by way of concerted conduct. The case indicates that the authorities are increasing their enforcement efforts in the industry and demonstrates how the NDRC has improved its handling of complicated cases.

New review system milestone for fair market competition
AnJie Law Firm
  • China
  • September 29 2016

The State Council recently published its Opinions on Establishing a Fair Competition Review System in the Development of the Market Regime, signalling the formal establishment of China's fair competition review system. The system is a major initiative to ensure fair play among participants in the Chinese market, and the opinions represent a key step towards implementing the council's measures to streamline administration and delegate more power to lower-level governments.

Allocation of burden of proof in private antitrust litigation
AnJie Law Firm
  • China
  • September 08 2016

Private antitrust litigation is becoming more popular and now acts as an important supplement to public antitrust enforcement actions in China. In 2012 the Supreme Court issued feasible rules for private antitrust litigation, including specific regulations governing the allocation of the burden of proof in certain circumstances. Four years on, it is pertinent to explore the issues regarding the allocation of the burden of proof in private antitrust litigation.

NDRC rules in first international shipping company monopoly case
AnJie Law Firm
  • China
  • August 04 2016

In 2015 the National Development and Reform Commission imposed penalties on eight international roll-on/roll-off shipping companies for entering into and implementing monopolistic agreements. However, under the leniency programme the first company to report collusion voluntarily and provide important evidence was exempted from any penalty, and the second and third companies to do so received reduced penalties.

Courts consider Sinopec's refusal to deal as abuse of market dominance
AnJie Law Firm
  • China
  • April 21 2016

In a noteworthy recent case, bioenergy manufacturer Yunnan Yingding claimed that Sinopec (a major state-owned oil company) and the Yunnan branch of Sinopec's trading company abused their dominant market position by refusing – for no justifiable reason – to incorporate the biodiesel produced by Yingding into Sinopec's distribution system. The case raises significant issues regarding application of the Anti-monopoly Law.

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