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Rule of Law Strengthens Foundation, Sword of Anti-monopoly Opens New Chapter

On August 1, 2022, the new Anti-Monopoly Law (“AML”) entered into force. The anti-monopoly law is a basic legal system to safeguard China’s socialist market economy system, and a key link in the socialist market economy legal system with Chinese characteristics. From the implementation of the AML on August 1, 2008, to the implementation of the newly revised AML on August 1, 2022, China’s anti-monopoly legal system has experienced from scratch, from coarse to fine, from single to comprehensive diversity development process. 

Standard “Construction of Fair Competition Compliance Management System for Undertakings” Issued for Public Comments

On July 29, the China Association for Standardization released the Construction of Fair Competition Compliance Management System for Undertakings (Draft for Comments) on its official website for public comments. This is a fair competition and compliance management standard for enterprises of different ownership and different industries, corresponding to the initiative of “competition in accordance with the law, operation in compliance, and maintaining market competition order” provided by the new AML.

Shandong Provincial Administration for Market Regulation Holds Seminar on Revision and Implementation of AML

On August 27, 2022, the Shandong Provincial Administration for Market Regulation organized a seminar on the revision and implementation of the AML. Relevant personnel from departments and units such as Shandong Provincial People's Procuratorate, Jinan Intermediate People's Court,  Tsingtao Brewery Co., Ltd., Wanhua Chemical Group, Meituan, and Deheng Law Firm attended the seminar, and conducted in-depth discussions on the revision of the AML in light of their respective work and business conditions. 

Jiangxi, Henan, Anhui and Other Places Carry Out Third-party Evaluation of Fair Competition Review in 2022

On August 19, it is reported that, with the implementation of the new AML, Jiangxi, Henan, Anhui, Tianjin and other provinces and cities have carried out third-party assessments of the implementation of the fair competition review system to effectively improve the effectiveness and constraints of the fair competition review, in order to further safeguard the market environment of fair competition and the interests of consumers. 

The Official Website of 2nd Division of AML Enforcement Adds Information Column for “Publication of Pilot Entrusted Cases”

On August 16, it is reported that since the State Administration for Market Regulation (“SAMR”) issued the Announcement on Piloting the Entrustment of Anti-monopoly Review in Selected Concentration of Undertakings, and it is planned to entrust 5 provincial market supervision departments on a pilot basis from August 1, 2022, namely the Provincial Administration for Market Regulation of Beijing, Shanghai, Guangdong, Chongqing and Shanxi would carry out anti-monopoly review of some simple cases. For this reason, the official website of the Second Division of AML Enforcement of the SAMR has recently added an information column for “Publication of Pilot Entrusted Cases”, which contains links to the announcement pages of entrusted cases of the 5 pilot provisional departments.

Hunan Strengthens AML Enforcement and Further Promotes Implementation of Fair Competition Review Mechanism

On August 5, it is reported that, the anti-monopoly front in Hunan Province has always focused on social hotspots and people’s livelihood issues, carried out in-depth anti-monopoly supervision and law enforcement, and continued to maintain a strong momentum of investigating and handling monopoly cases. This provincial administration fully cooperated with the SAMR  to investigate “Alibaba”, “Meituan”, “Yangtze River Pharmaceutical”, “CNKI”, glass industry and many other nationwide monopoly cases, and assisted and cooperated with Beijing, Xinjiang, Hainan, Henan and other provincial administrations to investigate a number of cross-regional monopoly cases. Since last year, a total of 39 clues on monopoly issues have been checked, and 17 monopoly cases have been investigated and dealt with, ranking the top in the country in terms of number of cases.

Henan Province Issues Notice on Carrying out Self-inspection and Cleaning up of Regulations and Practices Obstructing Construction of a Unified National Market

On August 2, in order to thoroughly implement the spirit of the Opinions of the CPC Central Committee and the State Council on Accelerating the Development of a Unified National Market, stimulate the vitality of market entities, smooth the domestic circulation, break local protectionism and market segmentation, and to promote the construction of a unified, open, competitive and orderly market system, Henan Provincial Government approved the decision of Provincial Administration for Market Regulation and the Provincial Development and Reform Commission to carry out self-inspection and clean-up work on regulations and practices that hinder the construction of a unified national market.

SAMR’s Anti-monopoly Function System for Merger Control Officially Launched

On August 1, the SAMR officially launched the anti-monopoly function system for merger control. The system integrates China’s anti-monopoly laws and regulations, notification process and review process of merger control, realizes the digital interaction of “notification end”, “entrustment end” and “review end”, and promotes the improvement of notification and review efficiency through digital empowerment.

7 Motor Vehicle Inspection Companies in Shanxi Fined More Than RMB 200,000 for Price-fixing and Income Allocation

On August 22, 2022, the SAMR announced an administrative penalty decision, 7 motor vehicle inspection companies in Shanxi were fined more than RMB 200,000 for price-fixing and income allocation in November 2021, the Shanxi Provincial Administration of Market Supervision filed an investigation into Shuozhou Motor Vehicle Inspection Company for allegedly reaching and implementing a monopoly agreement.

SAMR Responds to Progress of CNKI’s Anti-monopoly Investigation: Relevant Work Being Carried out in Accordance With Law

On August 17, the SAMR replied to the message from the reporter through the online platform: “the suspected monopolistic issues are being investigated in accordance with the law.” CNKI has been under investigation for three months for suspected monopoly.

Since 2021, Hunan Investigates and Deals With 19 Monopoly Cases, Mainly in Field of Public Utilities

On August 15, it was reported that the Hunan Provincial Administration for Market Regulation held an anti-monopoly administrative warning meeting in key industries to put forward suggestions for companies to operate in compliance. Since last year, Hunan province has checked 25 clues on monopoly issues, and investigated and dealt with 19 cases and related issues, including 2 monopoly agreement cases and 17 administrative monopoly cases. The number of cases ranks among the top in the country. The problems are mainly concentrated in public utility sector, there are forced transactions, overcharging, tying of commodities, adding unreasonable trading conditions and other acts that damage the order of competition and infringe the interests of operators and consumers.

Didi’s Agent Fined for Abuse of Market Dominance

On August 12, the SAMR issued an administrative penalty decision for Guizhou Zhoufucheng Logistics Co. Ltd. for abusing its dominant market position. The company is an agent of Didi, it took advantage of its dominant position in the Xingyi’s online car-hailing licensing market, restricting Xingyi’s Didi car-hailing drivers to apply for commercial vehicle insurance only through the company’s relevant personnel.

Administration for Market Regulation of Hunan and Guangxi Investigate Monopoly Agreement in Civil Explosive Equipment Industry on Same Day

On August 1, Hunan Nanling Civil Blasting Equipment Co., Ltd., a listed company on the Shenzhen Stock Exchange, issued a transaction report (draft) to disclose that on June 9, the company received a “Notice of Investigation of Monopoly Case” issued by Hunan Provincial Administration for Market Regulation, and investigated its suspected monopolistic behavior. On the same day, Gezhouba Yipuli Guangxi Weiqi Chemical Co., Ltd., a subsidiary of the target company Yipuli, received a “Notice of Investigation of Monopoly Case” issued by the Guangxi Provincial Administration for Market Regulation.

SAMR Announces 2022 Special Enforcement Action Cases to Curb Abuse of Administrative Power to Exclude and Restrict Competition (2nd Batch)

On July 29, the SAMR announced a total of 11 cases of abuse of administrative power to exclude and restrict competition in 2022 (the second batch), involving Hubei, Fujian, Chongqing, Xinjiang, Yunnan, Heilongjiang, Guangxi, Hunan.

Defendant Claims Glass Price Increase due to Anti-monopoly Investigation as a Changed Situation for Terminating Contract, Court Rejects

On August 30, 2022, China Judgment Online published a first instance judgment of a civil case involving a dispute over a sales contract. In this case, the defendant in the first instance, Yaopi Company, filed a counterclaim, claiming that during the performance of the contract, an association that was not involved in the case was suspected of monopolistic behavior, which led to the continuous increase in the price of glass raw materials, which constituted a change of situation, and therefore advocated the termination of the contract. After hearing, the court held that: the association’s alleged monopoly was only filed without corresponding punishment documents to prove, and the price of raw materials continued to rise after the case was filed, which showed that the price increase was more of a market behavior. Therefore, the change of situation cannot be established, and the defendant’s request to rescind the contract on this ground has no legal basis.

SPC Tries First Sports Event Anti-monopoly Case: Exclusive License Not Abuse of Market Dominance

On August 24, it is reported that the Supreme People’s Court (“SPC”) tried the first domestic sports event anti-monopoly case. The case has attracted much attention because it involves China's top football league and has a wide time span and great influence. The SPC held that “if the exclusive grant of management rights is commercially reasonable and competitive in the granting process, it is the result of fair competition. In principle, it is not appropriate to determine that the exclusive grant of management rights is an abuse of market dominance.”

SPC Publicly Hears Shell Co. Monopoly Agreement Case

On August 19, a public hearing was held at the First Court of the Intellectual Property Court of the SPC at 9:30 am, concerning the case of a horizontal monopoly agreement dispute among Hohhot Huili Materials Co., Ltd., Shell (China) Co., Ltd., Shell (China) Co., Ltd. and Shell (China) Co., Ltd.

Contract Dispute Opens “2nd Half” of Yiyang Concrete Monopoly Case

On August 12, China Judgments Online published the first-instance civil judgment of sales contract disputes among a construction material Co., Ltd. in Yiyang, a construction group Co., Ltd. in Hunan Province, etc. After the director of an office in Yiyang City was punished heavily, the Yiyang concrete monopoly case opened up a new dimension of investigation.

“Driving School Joint Venture” Horizontal Monopoly Agreement Judgment Released, Clarifying Standards of Proof for Monopoly Agreement Exemption

On August 5, the judgment of the horizontal monopoly agreement case of “driving school joint venture”, one of the top ten cases of intellectual property was published by China Judgments Online. The case clarified the standard of proof for exemption of monopoly agreement.

SPC Case: Supporting Use of All Product Sales Revenue Rather Than Sales Revenue of Products Involved as Basis for Calculation of Fines

On August 5, China Judgments Online published the second-instance judgment of the Hainan Provincial Administration for Market Regulation and Hainan Shenghua Construction Co., Ltd. in the penalty category case. In its judgment, the SPC clearly supported the use of the sales of all products rather than the sales of the products involved as the basis for calculating the amount of fine.

SPP Releases Typical Antitrust Cases of Procuratorial Organs

On August 4, the Supreme People’s Procuratorate (“SPP”) released 6 typical cases of punishing crimes disrupting market competition order according to law, demonstrating the procuratorial organs’ clear attitude to severely punish crimes disrupting market competition order, and demonstrating the positive effect of procuratorial organs’ participation in comprehensive management of market competition order.

SPP Issues Notice: Actively and Steadily Carry out Public Interest Litigation in Field of Anti-monopoly, Focusing on Internet, Public Utilities, Medicine and Other Areas of People’s Livelihood Security

On August 1, the SPP issued the Notice on Implementing the Anti-Monopoly Law of the People’s Republic of China Actively and Steadily Carrying out Public Interest Litigation and Prosecution Work in the Anti-monopoly Field, requiring conscientious implementation of the revised AML actively and steadily carry out public interest litigation and prosecution work in the anti-monopoly field, focusing on the Internet, public utilities, medicine and other areas of people's livelihood security.

“CNKI’s First Anti-Monopoly Litigation Case” Withdrawn

On July 31, it is learned from the plaintiff Guo Bing of the “First Anti-Monopoly Case of CNKI” that, on July 27, the Hangzhou Intermediate People’s Court had ruled to approve the application for withdrawal of the lawsuit filed on July 20. Previously, this case was considered by a number of academic and industry experts as “the First Anti-Monopoly Case of CNKI”. The plaintiff's withdrawal of the lawsuit means that the case has come to an end. But for CNKI, this may only be the first step in its anti-monopoly rectification.

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