{"id":664,"date":"2019-12-11T11:04:22","date_gmt":"2019-12-11T03:04:22","guid":{"rendered":"http:\/\/stllawreview.com\/?p=664"},"modified":"2022-02-20T18:46:51","modified_gmt":"2022-02-20T10:46:51","slug":"key-take-aways-from-samrs-triple-guidance-on-antitrust-enforcement","status":"publish","type":"post","link":"https:\/\/stllawreviewblog.com\/index.php\/2019\/12\/11\/key-take-aways-from-samrs-triple-guidance-on-antitrust-enforcement\/","title":{"rendered":"Key Take-Aways from SAMR\u2019s Triple Guidance on Antitrust Enforcement"},"content":{"rendered":"

Lin Yifu<\/em>*<\/em><\/a><\/span><\/p>\n

\"SAMR'sSAMR’s Logo \u00a9\ufe0f Hong Kong Competition Exchange<\/span><\/p>\n

On June 26, 2019, the State Administration for Market Regulation (hereinafter \u201cSAMR\u201d) promulgated three interim provisions in implementing Anti-Trust Law, all of which would come into effect on September 1, 2019.<\/span><\/a>[1]<\/a> Respectively, these new regulations<\/span><\/a>[2]<\/a> would govern three categories of monopolistic behaviors: monopoly agreements, abuse of dominant market position, and abuse of administrative power to exclude or restrict competition.<\/span><\/p>\n

SAMR\u2019s triple guidance on antitrust enforcement came against the backdrop of the \u201cthree-in-one\u201d anti-trust law enforcement agency reform in 2018.<\/span><\/a>[3]<\/a> Against such background, SAMR aims to unify the fragmented tripartite enforcement scheme as existed previously where three separate agencies shared overlapped authorities.<\/span><\/a>[4]<\/a> These new regulations, as the work-product of such unifying efforts, provide detailed guidance on the law enforcement process. This Note<\/a>\u2014with an Annex<\/a> summarizing primary changes\u2014will address these three new regulations in turn, informing both academics and practitioner of the regulatory changes.<\/span><\/p>\n

Chapter A. Prohibition against Anti-Competitive Agreements<\/strong><\/span><\/p>\n

After seven years when the prior regulation on monopoly agreements came into force,<\/span><\/a>[5]<\/a> the Interim Provisions on the Prohibition of Monopoly Agreements<\/em> (hereinafter \u201cSAMR Monopoly Agreements Regulation<\/em>\u201d) aims to further codify the practice of the law enforcement agencies,<\/span><\/a>[6]<\/a> laying out detailed guidance, both substantively and procedurally, on implementing Chapter 2 of the Anti-Trust Law.<\/span><\/a>[7]<\/a> In terms of the substantive provisions, SAMR Monopoly Agreements Regulation<\/em> provides detailed guidance on regulating various types of monopoly agreements, and for the first time lay out a multi-factor test in identifying non-typical monopoly agreements.<\/span><\/a>[8]<\/a> On the procedural side, SAMR Monopoly Agreements Regulation<\/em> deviates from the prior regulation to the extent that three categories of lenient policy are specifically provided in the new regulation, modifying the blanket leniency regime as prescribed in the prior regulation.<\/span><\/a>[<\/a>9]<\/a><\/span><\/p>\n

Section I. Substantive Provisions<\/strong><\/span><\/p>\n

In regulating monopoly agreements, SAMR Monopoly Agreements Regulation<\/em> attempts to bring all kinds of monopoly agreements within the purview of regulation,<\/span><\/a>[10]<\/a> sweepingly covering typical monopoly agreements,<\/span><\/a>[11]<\/a> non-typical monopoly agreements,<\/span><\/a>[12]<\/a> and concerted practices.<\/span><\/a>[13]<\/a> The following would address these three kinds of monopoly agreements in turn.<\/span><\/p>\n

Part A. Typical Monopoly Agreements<\/em><\/strong><\/span><\/p>\n

For the purpose of this article, typical monopoly agreements denote to those monopoly agreements as prescribed from Art. 7 to Art. 12 of the new regulation. Also widely termed as hardcore cartel conduct,<\/span><\/a>[14]<\/a> these typical monopoly agreements are considered to be per se<\/em> illegal.<\/span><\/a>[15]<\/a> In other words, the entry of such monopoly agreements, standing alone, would be recognized as violating the Anti-Trust Law despite whether or not such monopoly agreements indeed exclude or restrict competition in the market.<\/span><\/p>\n

What is noteworthy is that SAMR Monopoly Agreements Regulation<\/em> adds the catch-all clause under each provision regulating typical monopoly agreements.<\/span><\/a>[16]<\/a> As a result, the provisions on typical monopoly agreements firstly enumerate specific scenarios, and then provides a catch-all clause. Such \u201cenumeration plus catch-all provision\u201d legislation mode\u2014a typical legislative drafting in China\u2014seems to be more adoptable: the enumeration of specific scenarios where certain conduct would be deemed as monopoly agreement could rein in the otherwise unlimited discretionary power wielded by the enforcement agency, whereas at the same time the catch-all-provision preserve the flexibility. Nonetheless, the catch-all provisions, not modified by any limiting phrase, might also generate uncertainty as well.<\/span><\/p>\n

Also noteworthy is the non-applicability of commitment and suspension of investigation provisions to the extreme hard-core cartel agreements, which indicates its severe nature.<\/span><\/a>[17]<\/a> SAMR Monopoly Agreements Regulation<\/em>, in setting forth the detailed guidance on the commitment and suspension of investigation, explicitly specifies that the commitment and suspension of investigation provision is not applicable to three types of monopoly agreement, i.e., price-fixing or changing monopoly agreements, production or sales volume restricting monopoly agreements, and market division monopoly agreements.<\/span><\/a>[18]<\/a> That said, monopoly agreements other than those three extreme hard-core cartel agreements are still subject to the application of commitment and suspension of investigation provision.<\/span><\/p>\n

Part B. Non-Typical Monopoly Agreements<\/em><\/strong><\/span><\/p>\n

One of the primary regulatory changes in SAMR Monopoly Agreements Regulation<\/em> is the adding of a multi-factor test in identifying the non-typical monopoly agreements. The inclusion of such multi-factor test aims to provide guidance for enforcement agencies.<\/span><\/a>[19]<\/a> Under Art. 13, the new regulation provides several factors in determining whether or not certain conduct still falls within the purview of the Anti-Trust Law, though such conduct certainly is not covered by the typical monopoly agreements provisions and concerted practices provisions. Specifically, Art. 13 dictates SAMR to consider, inter alia<\/em>, the market competition status, the impact on the price of the commodities, and other factors.<\/span><\/p>\n

As noted above, the analysis under non-typical monopoly agreements implicates the analysis of the ramifications of the allegedly illegal conduct. Whereas the entry of the typical monopoly agreement would by itself be considered as illegal, the entry of the non-typical one is insufficient. The potential or actual effect in excluding or restricting competition has to be proved before such non-typical monopoly agreement could be considered as illegal.<\/span><\/p>\n

Part C. Concerted Practices<\/em><\/strong><\/span><\/p>\n

In tracking the prior regulation, SAMR Monopoly Agreements Regulation <\/em>provides that concerted practices are also a form of monopoly agreement,<\/span><\/a>[20]<\/a> and also fleshes out a multi-factor test for the purpose of identifying concerted practices.<\/span><\/a>[21]<\/a> Same as the inclusion of the multi-factor test under non-typical monopoly agreements, such test aims to provide practical guidance for law enforcement agencies.<\/span><\/p>\n

Section II. Procedural Provisions<\/strong><\/span><\/p>\n

Amongst all the regulatory changes, the modification of the leniency regime stands out the most. The prior regulation establishes the bifurcated categories of leniency policy where the first self-reporting operator is eligible for exemption of penalties while all the remaining self-reporting operators can enjoy mitigation of penalties.<\/span><\/a>[22]<\/a> In tracking the Draft Guidelines for the Application of the Leniency Program to Cases Involving Horizontal Monopoly Agreements<\/em>,<\/span><\/a>[23]<\/a> the new regulation creates the trifold leniency vis-\u00e0-vis the bifurcated categories.<\/span><\/p>\n

Basically, the trifold leniency regime provides different degrees of leniency program with respect to the first, the second, and the third self-reporting operator.<\/span><\/a>[24]<\/a> The first self-reporting operator enjoys the most lenient program where penalties might be exempted, or fines could be reduced by 80% at a maximum. For the second one, fines could be reduced by at least 30% and by 50% at most. The third one enjoys the least lenient policy where 20% to 30% reduction of fines is available. With such laddered leniency policy (rather than the blanket leniency policy), SAMR attempts to provide better incentives for market players where each of them would compete for more preferential treatments.<\/span><\/a>[25]<\/a><\/span><\/p>\n

Chapter B. Prohibition against Abuse of Dominant Market Provision<\/strong><\/span><\/p>\n

The Interim Provisions on Prohibiting Acts of Abuse of a Dominant Market Position<\/em> (hereinafter \u201cSAMR Abuse of Dominant Market Position Regulation<\/em>\u201d) presents most of the regulatory changes amongst all three new regulations. Similar to the SAMR Monopoly Agreements Regulation<\/em>, this new regulation contains both substantive and procedural provisions. Regarding the substantive provisions, the most eye-catching part in the new regulation pertains to several context-specific multi-factor test in determining dominant market position,<\/span><\/a>[26]<\/a> which embody SAMR\u2019s effort in reacting to the developing economic reality. Also noteworthy is the enumeration of justifications corresponding to each type of abusive conduct, providing efficient defense for market players.<\/span><\/a>[27]<\/a> The procedural provisions in SAMR Abuse of Dominant Market Position Regulation<\/em> is quite similar to those under SAMR Monopoly Agreements Regulation<\/em>.<\/span><\/p>\n

Section I. Substantive Provisions<\/strong><\/span><\/p>\n

The substantive provisions in SAMR Abuse of Dominant Market Position Regulation<\/em> earn most of the spotlight at this time, especially those provisions that provide industry-specific guidance.<\/span><\/a>[28]<\/a> In addition, the enumeration of context-specific justifications also stands out because such enumeration would enable market players to efficiently defend themselves when facing investigations. The following would address these primary regulatory changes in turn.<\/span><\/p>\n

Part A. Industry-Specific Guidance<\/em><\/strong><\/span><\/p>\n

SAMR Abuse of Dominant Market Position Regulation<\/em> differentiates itself from the prior regulation (i.e., Provisions of the Industry and Commerce Administration Organs on Prohibition of Abuse of Dominant Market Position<\/em><\/span><\/a>[29]<\/a>) to the extent that the new regulation sets forth industry-specific guidance in determining dominant market position. The new regulation, in catching up with the pace of new economic norm in China, caters to the idiosyncratic needs of each industry.<\/span><\/a>[30]<\/a><\/span><\/p>\n

(a) Internet Sector<\/em>. Art. 11 directs at new economic sectors like the Internet industry. Under this article, several factors are fleshed out for the purpose of determining whether or not certain operators within the new economic sectors have a dominant market position. These enumerated factors include, inter alia<\/em>, the number of users, capabilities of market innovation, and technological features.<\/span><\/a>[31]<\/a><\/span><\/p>\n

(b) IPR Sector<\/em>. Art. 12 focuses on the intellectual property field. Although there already exists a single set of provisions that governs abuse of dominant market provision in IP field (i.e., the Provisions on the Prohibition of the Abuse of Intellectual Property Rights to Exclude or Restrict Competition<\/em>)<\/span><\/a>[32]<\/a>, Art. 12 supplements the existing regulatory regime by providing additional factors to be considered in the determination of dominant market position. These factors include, inter alia<\/em>, the substitutability of the intellectual property concerned, and the degree of dependence of downstream markets.<\/span><\/p>\n

(c) Collective Dominance<\/em>. Art. 13 directs at the context of collective dominance. The term \u201ccollective dominance\u201d refers to the situation where two or more than two operators are deemed to collectively possess a dominant market position. Art. 13 sets forth additional factors to be considered in determining the existence of collective dominance. For example, consideration shall be accorded to the degree of the homogeneity of relevant commodities.<\/span><\/p>\n

\u00a0<\/em>(d) Public Utility Sector<\/em>. Art. 25 focuses on the public utility sector. Public utility sector like water supply, due to economies of scale, oftentimes is the sector where dominant market position generates.<\/span><\/a>[33]<\/a> Art. 25, though not providing a multi-factor test like Art. 11, Art. 12, and Art. 13 do, specifically points out that operators within public utility sector shall not abuse their dominant market position to the detriment of the interest of consumers.<\/span><\/p>\n

Part B. Various Types of Abusive Conduct<\/em><\/strong><\/span><\/p>\n

SAMR Abuse of Dominant Market Position Regulation<\/em> largely tracks the prior regulation in prohibiting various types of abusive conduct.<\/span><\/a>[34]<\/a> In addition, the new regulation lays out two new types of abusive conduct, i.e., (a) selling commodities at unfairly high prices or buying commodities at unfairly low prices as prescribed under Art. 14, and (b) selling commodities at prices below cost as prescribed under Art. 15. It is noteworthy that similar to Art. 11, Art. 15 also provides guidance that caters to new economic sectors. Specifically, attention is being drawn to the \u201cfree model\u201d within the Internet and other new economic sectors, with additional guidance provided.<\/span><\/a>[35]<\/a><\/span><\/p>\n

Part C. Enumeration of Justification<\/em><\/strong><\/span><\/p>\n

Under Art. 15 to Art. 19 where specific types of abusive conduct are provided, these provisions also provide lists of enumerated justifications. Each list sets out context-specific justifications for each type of abusive conduct. For market players, such regulatory change is applaudable in the sense that it makes efficient defense available. Compared to the prior regulation where there is no guidance on what kinds of justification could be invoked by the operator, such enumeration would enable market players to efficiently defend themselves by simply invoking the ground provided. Simply put, such enumeration offers clear categorical guidance on what could be the kinds of justification that could help the market players off the hook.<\/span><\/p>\n

For example, Art. 15 prohibits abusive conduct in selling commodities at prices below the costs.<\/span><\/a>[36]<\/a> Now the operator can simply argue that the below-cost sale is for the purpose of promotion of new commodities, which is prescribed as one of the justifications listed under Art. 15.<\/span><\/p>\n

Part D. Catch-All Provision<\/em><\/strong><\/span><\/p>\n

Similar to SAMR Monopoly Agreements Regulation<\/em>, SAMR Abuse of Dominant Market Position Regulation <\/em>also contains a catch-all provision in regulating other abusive conducts. Art. 21 of the new regulation provides that other abusive conduct could fall within the purview of the Anti-Trust Law as long as all of the elements listed thereunder are satisfied.<\/span><\/a>[37]<\/a> Compared to the prior regulation where there is no such catch-all provision, the new regulation certainly offers more latitude for the enforcement agency in policing against abusive conduct. But again, the inclusion of such provisions would bring in uncertainty to the market.<\/span><\/p>\n

Section II. Procedural Provisions<\/strong><\/span><\/p>\n

The procedural provisions as contained in SAMR Abuse of Dominant Market Position Regulation<\/em> is largely similar to those under SAMR Monopoly Agreements Regulation<\/em>. However, it is worth pointing out that the commitment and suspension of investigation provisions (Art. 29 to Art. 34 of SAMR Abuse of Dominant Market Position Regulation<\/em>) apply to all types of abusive conducts, while under SAMR Monopoly Agreements Regulation<\/em>, the commitment and suspension of investigation provisions are not applicable to those three extreme hardcore cartel agreements.<\/span><\/a>[38]<\/a><\/span><\/p>\n

Chapter C. Prohibition against Administrative Monopoly<\/strong><\/span><\/p>\n

The Interim Provisions on Prohibiting Acts of Abuse of Administrative Authority to Eliminate or Restrict Competition<\/em> (hereinafter \u201cSAMR Administrative Monopoly Regulation<\/em>\u201d) also contains both substantive and procedural provisions. The primary regulatory changes that SAMR Administrative Monopoly Regulation <\/em>brings about pertain to the procedural side, and in terms of the substantive provisions it basically restates the prior regulation (i.e., Provisions for Administrations for Industry and Commerce on Prohibition of Abuse of Administrative Authority to Eliminate or Restrict Competitive Acts<\/em>).<\/span><\/a>[39]<\/a><\/span><\/p>\n

Section I. Substantive Provisions<\/strong><\/span><\/p>\n

Under Art. 4 to Art. 9, SAMR Administrative Monopoly Regulation<\/em> details the types of conducts of abusing administrative authority to eliminate or restrict competition, which are oftentimes dubbed as an “administrative monopoly,”<\/span><\/a>[40]<\/a> and is quite a sensitive topic in China.<\/span><\/a>[41]<\/a> Such administrative monopolies include, inter alia<\/em>, abuse of administrative authority to impede the free circulation of goods, and abuse of administrative authority in bidding activities.<\/span><\/p>\n

Section II. Procedural Provisions<\/strong><\/span><\/p>\n

The primary regulatory changes in the context of administrative monopoly are on the procedural side. Such changes embody the drafter\u2019s endeavors in responding to the needs of the market players to ensure procedural fairness in implementing the Anti-Trust Law.<\/span><\/p>\n

Part A. Publicity<\/em><\/strong><\/span><\/p>\n

On an unprecedented basis, Art. 2 provides that the competent authority shall make public its decision that certain administrative conduct constitutes administrative monopoly. The stipulation on publicity mirrors the agency\u2019s awareness that such publicity could stimulate the investigated agency to rectify its administrative monopoly conduct. Such publicity is more desirable when considering that the anti-trust law enforcement agency is not authorized to impose any penalties over the investigated agency, but only to propose suggestions to the superior body of the investigated agency.<\/span><\/a>[42]<\/a><\/span><\/p>\n

Part B. Right of Statement<\/em><\/strong><\/span><\/p>\n

Art. 18 is the provision on the right of making a statement, which enables more participation from the investigated agency during the enforcement process. Art. 18 also obligates the law enforcement agency to verify the facts, arguments, and evidence proposed by the investigated agency.<\/span><\/p>\n

Part C. Investigation Procedure<\/em><\/strong><\/span><\/p>\n

In responding to the market criticism, SAMR Administrative Monopoly Regulation<\/em> stipulates the nuts and bolts of the investigation procedure.<\/span><\/a>[43]<\/a> The new regulation sets out the details of the investigation procedure in the context of administrative monopoly: firstly, the concept of \u201cinvestigation\u201d is explicitly defined in Art. 15; secondly, termination of investigation is warranted if the investigated agency voluntarily take measures to discontinue the allegedly administrative monopoly conduct; thirdly, the law enforcement agency can propose suggestions to the superior body of the investigated agency whose conduct is found to be illegal.<\/span><\/p>\n

Part D. Whistleblowing<\/em><\/strong><\/span><\/p>\n

Although all three new regulations touch on whistleblowing, only SAMR Administrative Monopoly Regulation<\/em> provides that every individual and entity have the right to report suspected administrative monopoly conducts.<\/span><\/a>[44]<\/a> Also, only SAMR Administrative Monopoly Regulation<\/em> imposes an obligation upon enforcement agency to keep confidential of the whistleblower\u2019s identity.<\/span><\/a>[45]<\/a> Needless to say, such confidentiality obligation would help in preventing the ex post<\/em> revenge from the investigated agency.<\/span><\/p>\n

Chapter D. Comments<\/strong><\/span><\/p>\n

With respect to the commonality of these new regulations, it is noteworthy that all three interim provisions cover the allocation of authority at the very beginning.<\/span><\/a>[46]<\/a> In response to the \u201cthree in one\u201d reshuffle of anti-trust enforcement agencies,<\/span><\/a>[47]<\/a> all three new regulations provide that Administrative for Market Regulation would be responsible for anti-trust law enforcement work. Generally speaking, the SAMR would take enforcement actions against monopoly conducts that (a) take place across provinces or on a nationwide basis, (b) are complicated in nature, or (c) it considers necessary.<\/span><\/a>[48]<\/a> The Administrative for Market Regulation on the provincial level would be in charge of those monopoly conducts within their respective administrative regions.<\/span><\/p>\n

Although most people applaud for the regulatory changes the triple guidance would bring in the near future, doubts linger on whether these regulations would provide clear enough guidance. For instance, some criticize that although SAMR Abuse of Dominant Market Position<\/em> fleshes out the factors to be considered in determining the dominant market position in the Internet sector, those factors are hard to quantify and may impose more difficulties than guidance for enforcement agency.<\/span><\/a>[49]<\/a> It remains to be seen how these new regulations would unfold in practice. <\/span><\/a>[50]<\/a><\/span><\/p>\n

References<\/strong><\/p>\n

 <\/p>\n

*<\/a> Mr. LIN Yifu, Juris Doctor & Juris Master Candidate at Peking University School of Transnational Law. This Note is written for Peking University Transnational Law Review Blog, chaired by Professor Susan Finder. The author owes a debt of gratitude to Professor Finder for her valuable remarks. Any shortcomings in this article are solely the author\u2019s responsibility. Please address any feedback to yifu.lin@outlook.com.<\/p>\n

 <\/p>\n

[1]<\/a> See Jinzhi Longduan Xieyi Zanxing Guiding (\u7981\u6b62\u5784\u65ad\u534f\u8bae\u6682\u884c\u89c4\u5b9a) [The Interim Provisions on the Prohibition of Monopoly Agreements] (promulgated by the State Administration for Market Regulation, June 26, 2019, effective Sep. 1, 2019) (China); see also Jinzhi Lanyong Shichang Zhipei Diwei Zanxing Guiding <\/span>
\n(\u7981\u6b62\u6ee5\u7528\u5e02\u573a\u652f\u914d\u5730\u4f4d\u6682\u884c\u89c4\u5b9a) [The Interim Provisions on Prohibiting Acts of Abuse of a Dominant Market Position] (promulgated by the State Administration for Market Regulation, June 26, 2019, effective Sep. 1, 2019) (China); see also Zhizhi Lanyong Xingzheng Quanli Paichu Xianzhi Jingzheng Xingwei Zanxing Guiding (\u5236\u6b62\u6ee5\u7528\u884c\u653f\u6743\u529b\u6392\u9664\u3001\u9650\u5236\u7ade\u4e89\u884c\u4e3a\u6682\u884c\u89c4\u5b9a) [The Interim Provisions on Prohibiting Acts of Abuse of Administrative Authority to Eliminate or Restrict Competition] (promulgated by the State Administration for Market Regulation, June 26, 2019, effective Sep. 1, 2019) (China).<\/span><\/p>\n

[2]<\/a> For reference purpose, these three new regulations in draft version have been previously released to the market for comments. See Shichang Jianguan Zongju Guanyu Jinzhi Longduan Xieyi Xingwei De Guiding Zhengqiu Yijiangao Gongkai Zhengqiu Yijian De Gonggao (\u5e02\u573a\u76d1\u7ba1\u603b\u5c40\u5173\u4e8e\u300a\u7981\u6b62\u5784\u65ad\u534f\u8bae\u884c\u4e3a\u7684\u89c4\u5b9a\uff08\u5f81\u6c42\u610f\u89c1\u7a3f\uff09\u300b\u516c\u5f00\u5f81\u6c42\u610f\u89c1\u7684\u516c\u544a) [Announcement of the State Administration for Market Regulation on Seeking Public Comments on the Provisions on the Prohibition of Monopoly Agreements (Draft for Comment)] (issued by the State Administration for Market Regulation, Jan. 3, 2019) (China); see also Guojia Shichang Jiandu Guanli Zongju Guanyu Jinzhi Lanyong Shichang Zhipei Diwei De Guiding Zhengqiu Yijiangao Gongkai Zhengqiu Yijian De Gonggao (\u56fd\u5bb6\u5e02\u573a\u76d1\u7763\u7ba1\u7406\u603b\u5c40\u5173\u4e8e\u300a\u7981\u6b62\u6ee5\u7528\u5e02\u573a\u652f\u914d\u5730\u4f4d\u884c\u4e3a\u7684\u89c4\u5b9a\uff08\u5f81\u6c42\u610f\u89c1\u7a3f\uff09\u300b\u516c\u5f00\u5f81\u6c42\u610f\u89c1\u7684\u516c\u544a) [Announcement of the State Administration for Market Regulation on Seeking Public Comments on the Provisions on the Prohibition of Abuse of Dominant Market Position (Draft for Comment)] (issued by the State Administration for Market Regulation, Jan. 30, 2019) (China); see also Guojia Shichang Jiandu Guanli Zongju Guanyu Zhizhi Lanyong Xingzheng Quanli Paichu Xianzhi Jingzheng Xingwei De Guiding Zhengqiu Yijiangao Gongkai Zhengqiu Yijian De Gonggao (\u56fd\u5bb6\u5e02\u573a\u76d1\u7763\u7ba1\u7406\u603b\u5c40\u5173\u4e8e\u300a\u5173\u4e8e\u5236\u6b62\u6ee5\u7528\u884c\u653f\u6743\u529b\u6392\u9664\u3001\u9650\u5236\u7ade\u4e89\u884c\u4e3a\u7684\u89c4\u5b9a\uff08\u5f81\u6c42\u610f\u89c1\u7a3f\uff09\u300b\u516c\u5f00\u5f81\u6c42\u610f\u89c1\u7684\u516c\u544a) [Announcement of the State Administration for Market Regulation on Seeking Public Comments on the Provisions on Prohibiting Acts of Abuse of Administrative Authority to Eliminate or Restrict Competition (Draft for Comment)] (issued by the State Administration for Market Regulation, Jan. 14, 2019) (China).<\/span><\/p>\n

[3]<\/a> For more information on the \u201cthree-in-one\u201d reshuffle of anti-trust enforcement agencies, see Guowuyuan Jigou Gaige Fangan (\u56fd\u52a1\u9662\u673a\u6784\u6539\u9769\u65b9\u6848) [Institutional Reform Program of the State Council] China Market Regulation News (2018) (China).<\/span><\/p>\n

[4]<\/a> See Shichang Jianguan Zongju Faguisi Zhuyao Fuzeren Jiu Jingzhi Longduan Xieyi Zanxing Guiding Deng Sanbu Fanlongduan Fa Peitao Guizhang Da Jizhe Wen (\u5e02\u573a\u76d1\u7ba1\u603b\u5c40\u6cd5\u89c4\u53f8\u4e3b\u8981\u8d1f\u8d23\u4eba\u5c31\u300a\u7981\u6b62\u5784\u65ad\u534f\u8bae\u6682\u884c\u89c4\u5b9a\u300b\u7b49\u4e09\u90e8\u300a\u53cd\u5784\u65ad\u6cd5\u300b\u914d\u5957\u89c4\u7ae0\u7b54\u8bb0\u8005\u95ee) [Q&A by State Administration for Market Regulation on Three Implementing Regulations for Anti-Trust Law] China Market Regulation News (2019) (China).<\/span><\/p>\n

[5]<\/a> See Gongshang Xingzheng Guanli Jiguan Jinzhi Longduan Xieyi Xingwei De Guiding (\u5de5\u5546\u884c\u653f\u7ba1\u7406\u673a\u5173\u7981\u6b62\u5784\u65ad\u534f\u8bae\u884c\u4e3a\u7684\u89c4\u5b9a) [Provisions of Industry and Commerce Administration Organs on Prohibition of Monopoly Agreements] (promulgated by State Administration for Industry and Commerce, Dec. 31, 2010, effective Feb. 1, 2011) (China).<\/span><\/p>\n

[6]<\/a> See supra note 4.<\/span><\/p>\n

[7]<\/a> Chapter 2 of the Anti-Trust Law focuses on regulating monopoly agreements. See Fanlongduan Fa (\u4e2d\u534e\u4eba\u6c11\u5171\u548c\u56fd\u53cd\u5784\u65ad\u6cd5) [Anti-Trust Law of the People\u2019s Republic of China] (promulgated by the Standing Committee of the National People\u2019s Congress, Aug. 30, 2007, effective Aug. 1, 2008) (China). For more reference, see DLA Piper US LLP, Anti-Monopoly Law of the People\u2019s Republic of China, DLA Piper (Nov. 6, 2007), https:\/\/www.dlapiper.com<\/a> (providing an unofficial translation of the PRC Anti-monopoly Law).<\/span><\/p>\n

[8]<\/a> See SAMR Monopoly Agreements Regulation, supra note 1, art. 13.<\/span><\/p>\n

[9]<\/a> See supra note 5, art. 12.<\/span><\/p>\n

[10]<\/a> Basically, across the major competition jurisdictions around the globe, almost all of these jurisdictions take similar approach in policing against all kinds of monopoly agreements. But PRC\u2019s approach seems to more straightforward in the sense that it categorizes monopoly agreements into two forms (i.e., monopoly agreement and concerted practices), while other jurisdictions do not explicitly take such bifurcated categorization. For the United States of America, under the Sherman Act (specifically, 15 U.S.C. \u00a7 1), it is provided that \u201c[e]very contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.\u201d See 54 Am. Jur. 2d Monopolies and Restraints of Trade \u00a7 31. For the United Kingdom, it also takes similar approach as that of US. See Angus Coulter, Competition regime: Chapter I prohibition, Thomson Reuters Practical Law (UK), https:\/\/uk.practicallaw.thomsonreuters.com<\/a> (search the title of the article) (explaining that UK competition law \u201cprohibits agreements that have an effect on trade within the UK or a part of the UK, and restrict competition in the UK or a part of the UK\u201d).<\/span><\/p>\n

[11]<\/a> See SAMR Monopoly Agreements Regulation, supra note 1, from art. 7 to art. 12.<\/span><\/p>\n

[12]<\/a> Id., art. 13.<\/span><\/p>\n

[13]<\/a> Id., art. 6.<\/span><\/p>\n

[14]<\/a> For a brief summary of other jurisdictions\u2019 terming hardcore cartel conduct, see Wang Xiaoye (\u738b\u6653\u6654), Jiazhong Zhicai Benshen Weifa De Kateer Leixing Ji Falv Houguo (\u52a0\u91cd\u5236\u88c1\u2014\u2014\u672c\u8eab\u8fdd\u6cd5\u7684\u5361\u7279\u5c14\u7c7b\u578b\u53ca\u6cd5\u5f8b\u540e\u679c) [Enhanced Sanctions: Types of Illegal Per Se Cartel and its Legal Consequences] 8 Intertrade 44 (2004) (China). On the international plane, see OECD, Recommendation of the OECD Council Concerning Effective Action against Hard Core Cartels, C\/M(98)7\/PROV (Mar. 25, 1998) (providing the definition of \u201chardcore cartel\u201d). Specifically, for UK law, see Practical Law Competition, Competition regime: The Enterprise Act 2002 cartel offence, Thomson Reuters Practical Law (UK), https:\/\/uk.practicallaw.thomsonreuters.com<\/a> (search the title of the article) (explaining that UK competition law draws on the definition of hardcore cartels used by the OECD). Also, for South Korean law, see Yoon & Yang LLC, KFTC announces substantial overhaul of Korean Antitrust Law, Thomson Reuters Practical Law (Global), https:\/\/uk.practicallaw.thomsonreuters.com\/Browse\/Home\/Global<\/a> (search the title of the article) (enumerating as hardcore cartels price-fixing, bid-rigging, supply-restricting and market allocation).<\/span><\/p>\n

[15]<\/a> The \u201cper se\u201d illegal rule derives from U.S. lexicon. For more information, see Yao Jianjun (\u59da\u5efa\u519b), Benshen Weifa Yuanze Yu Heli Yuanze Zai Longduan Xieyi Anzhong De Shiyong (\u672c\u8eab\u8fdd\u6cd5\u539f\u5219\u4e0e\u5408\u7406\u539f\u5219\u5728\u5784\u65ad\u534f\u8bae\u6848\u4e2d\u7684\u9002\u7528) [The Application of the Per Se Illegal Rule and Rule of Reason in Monopoly Agreement Cases] 2 People\u2019s Judicature 103 (2015) (China); see also David Pan et al., A Review of Monopoly Agreement Prohibition Tentative Measures, Llinks Law Offices (June 2019), http:\/\/www.llinkslaw.com<\/a> (search the title of the article). For the coverage of the \u201cper se\u201d illegal rule from US perspective, see 5 Mich. Civ. Jur. Combinations and Monopolies \u00a7 8.<\/span><\/p>\n

[16]<\/a> See SAMR Monopoly Agreements Regulation, supra note 1, from art. 7 to art. 12.<\/span><\/p>\n

[17]<\/a> See John Jiang et al., China\u2019s SAMR Issues Interim Rules on Prohibition Against Monopoly Agreements and Abuse of Dominance, Zhong Lun Law Firm (Jul. 17, 2019), http:\/\/www.zhonglun.com\/en<\/a> (search the title of the article).<\/span><\/p>\n

[18]<\/a> See SAMR Monopoly Agreements Regulation, supra note 1, art. 22.<\/span><\/p>\n

[19]<\/a> Such multi-factor test ultimately aims to provide guidance to the enforcement agencies on ascertaining the ramification or effect that the investigated conduct has caused. In that vein, such analysis is much similar to the analysis under the \u201crule of reason\u201d in the United States\u00a0\u00a0\u00a0\u00a0 antitrust lexicon. For more information on the \u201crule of reason\u201d in US law and its implication for PRC law, see Competition Law in China \u00a7 9:58.<\/span><\/p>\n

[20]<\/a> See supra note 5, art. 5.<\/span><\/p>\n

[21]<\/a> Id., art. 6.<\/span><\/p>\n

[22]<\/a> Id., art. 12.<\/span><\/p>\n

[23]<\/a> See Hengxiang Longduan Xieyi Anjian Kuanda Zhidu Shiyong Zhinan Zhengqiu Yijiangao Gongkai Zhengqiu Yijian (\u300a\u6a2a\u5411\u5784\u65ad\u534f\u8bae\u6848\u4ef6\u5bbd\u5927\u5236\u5ea6\u9002\u7528\u6307\u5357\u300b\uff08\u5f81\u6c42\u610f\u89c1\u7a3f\uff09\u516c\u5f00\u5f81\u6c42\u610f\u89c1) [Notice of Availability for Public Comment on the Draft Guidelines for the Application of the Leniency Program to Cases Involving Horizontal Monopoly Agreements] (issued by National Development and Reform Commission, Feb. 2, 2016) (China).<\/span><\/p>\n

[24]<\/a> See SAMR Monopoly Agreements Regulation, supra note 1, art. 34.<\/span><\/p>\n

[25]<\/a> See Fangda Partners, China Antitrust Authority Releases Long-awaited Rules on Abusive Conduct and <\/span>Anticompetitive Agreements, Fangda Partners (Jul. 18, 2019), http:\/\/www.fangdalaw.com<\/a> (search the title of the article) ; see also Liu Cheng et al., On Monopoly Agreements: Interpretation of Highlights in the Interim Provisions on the Prohibition of Monopoly Agreements and the Interim Provisions on the Prohibition of Acts Concerning Abuse of a Dominant Market Position (I), LexisNexis (Jul. 31, 2019), https:\/\/hk.lexiscn.com<\/a> (search the title of the article).<\/span><\/p>\n

[26]<\/a> See SAMR Abuse of Dominant Market Position Regulation, supra note 1, from art. 11 to art. 13.<\/span><\/p>\n

[27]<\/a> Id., from art. 15 to art. 19.<\/span><\/p>\n

[28]<\/a> Almost every professional article would mention detailed industry-specific guidance provided in the new regulation. See Fangda Partners, supra note 25; see also Zhong Lun Law Firm, supra note 17; see also supra note 4.<\/span><\/p>\n

[29]<\/a> See Gongshang Xingzheng Guanli Jiguan Jinzhi Lanyong Shichang Zhipei Diwei Xingwei De Guiding (\u5de5\u5546\u884c\u653f\u7ba1\u7406\u673a\u5173\u7981\u6b62\u6ee5\u7528\u5e02\u573a\u652f\u914d\u5730\u4f4d\u884c\u4e3a\u7684\u89c4\u5b9a) [Provisions of the Industry and Commerce Administration Organs on Prohibition of Abuse of Dominant Market Position] (promulgated by the State Administration for Industry and Commerce, Dec. 31, 2010, effective Feb. 1, 2011) (China).<\/span><\/p>\n

[30]<\/a> Other major competition jurisdictions also react, either on a theoretical discussion level or on a practice level, in response to the development of nascent industries. See Doris Karina Oropeza Mendoza, Antitrust in the New Economy Case Google Inc. Against Economic Competition on the Web, 8 Mexican Law Review 1 (2016); see also Daniel A. Crane, Market Power Without Market Definition, 1 Notre Dame Law Review 31 (2014).<\/span><\/p>\n

[31]<\/a> For more information, see Liu Cheng et al., On Abuse of a Dominant Market Position: Interpretation of the Highlights in the Interim Provisions on the Prohibition of Monopoly Agreements and the Interim Provisions on the Prohibition of Acts Concerning Abuse of a Dominant Market Position (II), LexisNexis (Jul. 31, 2019), https:\/\/hk.lexiscn.com<\/a> (search the title of the article).<\/span><\/p>\n

[32]<\/a> See Guanyu Lanyong Zhishi Chanquan Paichu Xianzhi Jingzheng Xingwei De Guiding (\u5173\u4e8e\u7981\u6b62\u6ee5\u7528\u77e5\u8bc6\u4ea7\u6743\u6392\u9664\u3001\u9650\u5236\u7ade\u4e89\u884c\u4e3a\u7684\u89c4\u5b9a) [Provisions on the Prohibition of the Abuse of Intellectual Property Rights to Exclude or Restrict Competition] (promulgated by State Administration for Industry and Commerce, Apr. 7, 2015, effective Aug. 1, 2015) (China).<\/span><\/p>\n

[33]<\/a> See Zheng Yanxin (\u90d1\u8273\u99a8), Lun Gongyong Qiye Lanyong Longduanli Xingwei (\u8bba\u516c\u7528\u4f01\u4e1a\u6ee5\u7528\u5784\u65ad\u529b\u884c\u4e3a) [On the Abuse of Monopoly Power by Public Enterprises] 29 Hebei Law Science 96, 97 (2011) (China).<\/span><\/p>\n

[34]<\/a> See Gongshang Xingzheng Guanli Jiguan Jinzhi Lanyong Shichang Zhipei Diwei Xingwei De Guiding (\u5de5\u5546\u884c\u653f\u7ba1\u7406\u673a\u5173\u7981\u6b62\u6ee5\u7528\u5e02\u573a\u652f\u914d\u5730\u4f4d\u884c\u4e3a\u7684\u89c4\u5b9a) [Provisions of the Industry and Commerce Administration Organs on Prohibition of Abuse of Dominant Market Position] (promulgated by State Administration for Industry and Commerce, Dec. 31, 2010, effective Feb. 1, 2011) (China).<\/span><\/p>\n

[35]<\/a> See SAMR Abuse of Dominant Market Position Regulation, supra note 1, art. 15.<\/span><\/p>\n

[36]<\/a> Id.<\/span><\/p>\n

[37]<\/a> Id., art. 21.<\/span><\/p>\n

[38]<\/a> See SAMR Monopoly Agreements Regulation, supra note 1, art. 22.<\/span><\/p>\n

[39]<\/a> See Gongshang Xingzheng Guanli Jiguan Zhizhi Lanyong Xingzheng Quanli Paichu Xianzhi Jingzheng Xingwei De Guiding (\u5de5\u5546\u884c\u653f\u7ba1\u7406\u673a\u5173\u5236\u6b62\u6ee5\u7528\u884c\u653f\u6743\u529b\u6392\u9664\u3001\u9650\u5236\u7ade\u4e89\u884c\u4e3a\u7684\u89c4\u5b9a) [Provisions for Administrations for Industry and Commerce on Prohibition of Abuse of Administrative Authority to Eliminate or Restrict Competitive Acts] (promulgated by State Administration for Industry and Commerce, Dec. 31, 2010, effective Feb. 1, 2011) (China).<\/span><\/p>\n

[40]<\/a> See Adrian Emch et al., SAMR\u2019s Triple Guidance on Antitrust Enforcement, Hogan Lovells (July 2019), https:\/\/www.hoganlovells.com\/<\/a> (search the title of the article).<\/span><\/p>\n

[41]<\/a> See Pochu Xingzheng Longduan Zhongzai Luoshi (\u7834\u9664\u884c\u653f\u5784\u65ad\u91cd\u5728\u843d\u5b9e) [Law Enforcement is the Focus of Anti-Administrative Monopoly Work] Wenhui News (2016) (China).<\/span><\/p>\n

[42]<\/a> See Practical Law China, SAMR Issues New Implementing Regulations for Anti-monopoly Law, Thomson Reuters Practical Law (China) (July 24, 2019), https:\/\/uk.practicallaw.thomsonreuters.com\/Browse\/Home\/Global\/China<\/a> (search the title of the article) (noting that SAMR can only provide \u201crecommendations as opposed to actual sanctions\u201d). For other competition jurisdictions, it is also the case that agency could only propose suggestions, as opposed to imposing sanctions. See Practical Law UK, Competition regime: Market investigations under the Enterprise Act 2002, Thomson Reuters Practical Law (UK), https:\/\/uk.practicallaw.thomsonreuters.com<\/a> (search the title of the article).<\/span><\/p>\n

[43]<\/a> Other major competition jurisdictions also have such detailed investigation procedures. For example, for the United States, the Federal Trade Commission Act (specifically, 15 U.S.C. \u00a7 56) stipulates the details of Federal Trade Commission authority\u2019s in conducting investigation, and also commencing litigation against the alleged violator of anti-trust law. For the United Kingdom, see Practical Law UK, supra note 42 (elaborating on the investigation procedure of the Competition and Markets Authority under the Enterprise Act 2002).<\/span><\/a><\/p>\n

[44]<\/a> See SAMR Administrative Monopoly Regulation, supra note 1, art. 11.<\/span><\/p>\n

[45]<\/a> Id.<\/span><\/p>\n

[46]<\/a> See Chen Xiaohua et al., A Review of the Three New Anti-Monopoly Regulations of SAMR, JunHe LLP (Jul. 23, 2019), http:\/\/www.junhe.com<\/a> (search the title of the article). For more information on Circular of the State Administration for Market Regulation on the Authority for Antitrust Law Enforcement, see Richard Blewett et al., Antitrust in China and Across the Region: Quarterly Update October to December 2018, Clifford Chance (Feb. 12, 2019), https:\/\/www.cliffordchance.com<\/a> (search the title of the article).<\/span><\/p>\n

[47]<\/a> For more information on the \u201cthree-in-one\u201d reshuffle of anti-trust enforcement agencies, see Andrew L. Foster, China\u2019s Antitrust Regime: Retooled, Retrenched and (Potentially) Ready for Battle, Skadden, Arps, Slate, Meagher & Flom LLP (June 19, 2018), https:\/\/www.skadden.com<\/a> (search the title of the article); see also Peter J. Wang et al., Combination of China\u2019s Three Antitrust Enforcement Agencies May Bring More Aggressive Enforcement Over Long Run, Jones Day (June 2018), https:\/\/www.jonesday.com<\/a> (search the title of the article); see also Noah A. Brumfield, China Merges Antitrust Enforcement Agencies into One, as its Anti-monopoly Law Approaches 10th Anniversary, White & Case LLP (Mar. 28, 2018), https:\/\/www.whitecase.com<\/a> (search the title of the article); see also S\u00e9bastien Evrard et al., Antitrust in China \u2013 2018 Year in Review, Gibson Dunn & Crutcher LLP (Feb. 11, 2019), https:\/\/www.gibsondunn.com<\/a> (search the title of the article); see also Davis Polk, China Antitrust Review 2018, Davis Polk & Wardwell LLP (Jan. 31, 2019), https:\/\/www.davispolk.com<\/a> (search the title of the article); see also John Terzaken et al., 2018 Global Cartel Enforcement Report, Simpson Thacher & Barlett LLP (Jan. 2019), https:\/\/www.stblaw.com<\/a> (search the title of the article); see also Linklaters, Year in Review 2018 and Year to Come 2019 for People\u2019s Republic of China, Linklaters (Dec. 2018), https:\/\/www.linklaters.com<\/a> (search the title of the article); see also Stephen Crosswell et al., China to Integrate its Three Antitrust Agencies into a Single Authority, Baker & McKenzie (Mar. 19, 2018), https:\/\/www.bakermckenzie.com<\/a> (search the title of the article).<\/span><\/p>\n

[48]<\/a> For more information, see Liu Cheng el al., On Investigation and Punishment Procedures: Interpretation of Highlights in the Interim Provisions on the Prohibition of Monopoly Agreements and the Interim Provisions on the Prohibition of Acts Concerning Abuse of a Dominant Market Position (III), LexisNexis (Jul. 31, 2019), https:\/\/hk.lexiscn.com<\/a> (search the title of the article).<\/span><\/p>\n

[49]<\/a> See Guo Xin, The New Anti-Monopoly Regulations Raise New Requirements to Law Enforcement in Internet Monopoly, Causing Greater Difficulty to Law Enforcement, Jin Mao Partners (Jul. 9, 2019), http:\/\/www.jinmaopartners.com\/en<\/a> (search the title of the article).<\/span><\/p>\n

[50]<\/a> It should be noted that the text of each provision or regulation is quoted from the unofficial translation of each provision or regulation as downloaded from LexisNexis (https:\/\/hk.lexiscn.com<\/a>). Such unofficial translations shall only be taken for reference purpose. Please refer to the official Chinese-language versions as the final authority.<\/span><\/p>\n

 <\/p>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Lin Yifu* SAMR’s Logo \u00a9\ufe0f Hong Kong Competition Exchange On June 26, 2019, the State Administration for Market Regulation (hereinafter \u201cSAMR\u201d) promulgated three interim provisions in implementing Anti-Trust Law, all of which would come into effect on September 1, 2019.[1] Respectively, these new regulations[2] would govern three categories of monopolistic behaviors: monopoly agreements, abuse of … Continue reading Key Take-Aways from SAMR\u2019s Triple Guidance on Antitrust Enforcement<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"{title}\n\n{excerpt}\n\n{url}","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"_wpas_customize_per_network":false,"jetpack_post_was_ever_published":false},"categories":[47,34,35],"tags":[114,113],"class_list":["post-664","post","type-post","status-publish","format-standard","hentry","category-antimonopoly-law","category-antitrust-enforcement","category-competition-law-enforcement","tag-anti-monopoly-law","tag-samr"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/pgBdw4-aI","_links":{"self":[{"href":"https:\/\/stllawreviewblog.com\/index.php\/wp-json\/wp\/v2\/posts\/664","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/stllawreviewblog.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stllawreviewblog.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stllawreviewblog.com\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/stllawreviewblog.com\/index.php\/wp-json\/wp\/v2\/comments?post=664"}],"version-history":[{"count":20,"href":"https:\/\/stllawreviewblog.com\/index.php\/wp-json\/wp\/v2\/posts\/664\/revisions"}],"predecessor-version":[{"id":1785,"href":"https:\/\/stllawreviewblog.com\/index.php\/wp-json\/wp\/v2\/posts\/664\/revisions\/1785"}],"wp:attachment":[{"href":"https:\/\/stllawreviewblog.com\/index.php\/wp-json\/wp\/v2\/media?parent=664"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stllawreviewblog.com\/index.php\/wp-json\/wp\/v2\/categories?post=664"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stllawreviewblog.com\/index.php\/wp-json\/wp\/v2\/tags?post=664"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}