China Monthly Antitrust Update: August 2023

Legislation

Guangdong and Hong Kong Sign Memorandum of Understanding on Effective Implementation of Competition Policies and Laws

On July 19, 2023, the signing ceremony of the Memorandum of Understanding on Advancing the Effective Implementation of Competition Policies and Laws in the Guangdong-Hong Kong-Macao Greater Bay Area between the Guangdong Administration for Market Regulation ("AMR") and the Competition Commission of the Hong Kong Special Administrative Region was held in Guangzhou City. [1]

State Council Issues Opinions on Promoting the Development and Growth of the Private Economy

On July 14, the State Council issued the Opinions on Promoting the Development and Growth of the Private Economy, which emphasized the implementation of a fair competition system and the strengthening of regulatory measures against administrative monopolies. [2]

Liaoning Provincial Department of Justice Seeks Public Opinions on the Draft Regulations on Fair Competition in Liaoning Province

On July 4, Liaoning Provincial Department of Justice sought opinions from all sectors of society on the Draft Regulations on Fair Competition in Liaoning Province (Solicitation Draft). [3]

Yunnan Province Issues Measures to Enhance the Rule of Law in the Business Environment, Calls for Severe Crackdown on Monopoly Agreements and Abuse of Market Dominance

On June 30, the General Office of the People's Government of Yunnan Province issued the 23 Measures for Comprehensive Improvement of the Rule of Law in the Business Environment in Yunnan Province. It proposed to "focus on anti-monopoly and anti-unfair competition, carry out special law enforcement actions on 'anti-monopoly and anti-unfair competition', and severely crack down on illegal activities such as monopoly agreements and abuse of market dominance".[4]

MOHRSS Issues Regulations on the Administration of Human Resources Service Agencies, Prohibiting Monopolistic Practices in the Human Resources Market

On June 29, the Ministry of Human Resources and Social Security (“MOHRSS”) announced the Regulations on the Administration of Human Resources Service Agencies, which becomes effective on August 1, 2023. The regulations stipulate that "for-profit human resources service agencies shall engage in fair competition, refrain from disrupting the price order of the human resources market, and shall not engage in activities such as monopolistic practices or unfair competition." [5]

Four Ministries, including SAMR, Issue Notice on Conducting Policies and Measures Cleanup Work that Hinders Unified Market and Fair Competition

On June 28, in order to fully implement the important deployments of the 20th National Congress of the Communist Party of China regarding the establishment of a unified national market, improvement of the basic system of a fair competition market economy, and the elimination of local protectionism and administrative monopolies, and in accordance with the relevant requirements of the Opinions of the Central Committee of the Communist Party of China and the State Council on Accelerating the Construction of a Unified National Market and other documents, with the approval of the State Council, the State Administration for Market Regulation ("SAMR"), the National Development and Reform Commission, the Ministry of Finance, and the Ministry of Commerce jointly issued the Notice on Conducting Policies and Measures Cleanup Work that Hinders Unified Market and Fair Competition. [6]

Hainan AMR Issues Letter on Conducting Policies and Measures Cleanup Work that Hinders Unified Market and Fair Competition 

On June 26, in order to accelerate the construction of a unified national market, eliminate local protectionism and administrative monopolies, and create a system and market environment of fair competition, Hainan AMR and Hainan Provincial Development and Reform Commission have decided to carry out a special cleanup work on polices that hinder unified market and fair competition throughout the province. They have issued a Letter on Conducting Policies and Measures Cleanup Work that Hinders Unified Market and Fair Competition regarding relevant matters. [7]

Authorities

Ministry of Transport Holds Talks with Didi, Amap, Cao Cao, and Other Ride-Hailing Platforms, Urging the Maintenance of Fair Competition in the Market Order

On July 26, 2023, the Office of the Inter-Ministerial Joint Conference on the Coordinated Regulation of New Forms of Transportation organized talks with ride-hailing platforms such as Didi, Amap, T3 Travel, Cao Cao Travel, and other aggregators. [8]

Hunan AMR, in Collaboration with Chongqing AMR and Hunan Provincial State-owned Assets Supervision and Administration Commission, Conducts Training on Anti-Monopoly Review of Concentrations of Undertakings

On July 25, Hunan AMR, in collaboration with Chongqing AMR and Hunan Provincial State-owned Assets Supervision and Administration Commission, conducted training on anti-monopoly review of concentrations of undertakings in Changsha, Hunan Province. [9]

Chongqing AMR Announces Recent Law Enforcement Situation on Anti-Monopoly and Fair Competition

On July 25, the Chongqing AMR released the law enforcement situation in recent years. The bureau has been actively promoting the implementation of fair competition policies and maintaining a market order of fair competition, achieving positive results in various aspects of work. [10]

Anti-Monopoly Legal Education and Publicity Campaign Held in Beijing

On July 24, Beijing AMR conducted a lecture on anti-monopoly legal education and publicity. The lecture covered topics such as the interpretation of supporting regulations for anti-monopoly laws and the establishment of anti-monopoly compliance systems. [11]

Xinjiang Uygur Autonomous Region Achieves Full Coverage of Fair Competition Review System

On July 21, the 2023 plenary session of the joint meeting of the departments responsible for fair competition review in Xinjiang Uygur Autonomous Region was held at the Autonomous Region AMR. The meeting highlighted that the region has achieved full coverage of the joint meeting system for fair competition review across all levels of government. [12]

SAMR: Nearly 300 Cases of Entrusting Review of Merger Control in the First Year 

As of July 20, in the past year, SAMR has conducted a pilot program by entrusting the local AMRs of Beijing, Shanghai, Guangdong, Chongqing, and Shaanxi with the review of 287 cases of merger control. These cases accounted for 40.7% of the total reported simplified cases during the same period. The pilot program has had a good start and steady progress, injecting new momentum into the high-quality development of the economy. [13]

Heilongjiang Province Launches Special Cleanup Work on Policies and Measures that Hinder Unified Market and Fair Competition 

Recently, the AMR, Development and Reform Commission, Finance Department, and Commerce Department of Heilongjiang Province jointly issued a document, deploying a special cleanup work on policies and measures that hinder unified market and fair competition throughout the province. [14]

Yangzhou, Jiangsu Province Establishes Mechanism for Coordinated Review of Fair Competition and Legality of Regulatory Documents

Recently, the AMR and the Judicial Bureau of Yangzhou, Jiangsu Province, jointly established a mechanism for the coordinated review of administrative regulatory document filing and fair competition. Currently, a total of three regulatory documents and eleven policy documents have undergone joint review. [15]

Premier Li Qiang Holds Platform Symposium: Focusing on Creating a Fair Competition Environment and Building a Transparent and Predictable Normalized Regulatory System

On July 12, Premier Li Qiang chaired a symposium with platform enterprises to gather opinions and suggestions on better promoting the standardized, healthy, and sustainable development of the platform economy. Li Qiang emphasized the need to "focus on creating a market environment of fair competition, improve policies such as investment access and safety assessment for new technologies and new businesses, establish a transparent and predictable normalized regulatory system, reduce compliance costs for enterprises, and promote the sound development of the industry." He also called for the establishment of a sound mechanism for regular communication and interaction with platform enterprises. [16]

Workshop on Anti-Monopoly Law Enforcement, as well as Regional Competition Environment Assessment, Held in Yangtze River Delta Region

On July 4, a workshop on anti-monopoly law enforcement as well as regional competition environment assessment within the Yangtze River Delta region was held in Huangshan City. The AMR of Shanghai, Jiangsu, Zhejiang and Anhui participated in discussions and exchanges regarding anti-monopoly law enforcement, implementation of fair competition policies, and regional cooperation. [17]

Public Enforcement

Hunan AMR Corrects Administrative Monopoly Practices in Shaoyang County and Yongxing County

On July 25, 2023, SAMR issued a notice stating that Hunan AMR has rectified the abusive use of administrative power to exclude and restrict competition by the People's Governments of Yongxing County and Shaoyang County. According to the notice, Hunan AMR initiated investigations into the alleged abusive use of administrative power to exclude and restrict competition by the People's Governments of Yongxing County and Shaoyang County on January 10 and January 17, 2022, respectively. [18]

A County Government in Anhui Province under Investigation for Issuing Documents Excluding and Restricting Competition in the Construction Market

On July 14, Anhui AMR issued a notice stating that it has rectified the abusive use of administrative power to exclude and restrict competition by the People's Government of Dangtu County in Ma'anshan City. According to the notice, Anhui AMR initiated an investigation into the alleged abusive use of administrative power to exclude and restrict competition by the People's Government of Dangtu County on September 28, 2022. [19]

China Association of Automobile Manufacturers Removes Price-related Statements from "Commitment Letter" and Urges Automakers to Strictly Comply with the Anti-Monopoly Law

On July 6, at the 2023 China Automotive Forum, the China Association of Automobile Manufacturers, along with executives from leading automobile companies, signed the Commitment Letter for Maintaining Fair Market Order in the Automotive Industry. The document pledges to refrain from disturbing market fair competition order with abnormal prices. On July 8, the China Association of Automobile Manufacturers issued a statement stating that the mention of "disturbing market fair competition order with abnormal prices" in the Commitment Letter for Maintaining Fair Market Order in the Automotive Industry signed by 16 automotive production companies contains inappropriate wording concerning "prices" and violates the spirit of the Anti-Monopoly Law. The mentioned provision has been removed from the commitment letter. The association also urged the 16 companies and other member companies in the automotive production industry to strictly comply with the Anti-Monopoly Law, as well as relevant administrative regulations, guidelines, and rules. They are encouraged to engage in independent pricing and fair competition, contributing jointly to the standardized, healthy, and innovative development of the industry. [20]

Merger Control

Not Meeting the Filing Criteria, Simcere Pharmaceutical Voluntarily Submits Antitrust Filing for Merger 

On July 28, 2023, Beijing High People's Court issued an enforcement ruling, which mentioned that Simcere Pharmaceutical voluntarily filed for a merger notification despite not meeting the criteria for mandatory merger filing. [21]

SAMR Conditionally Approves Acquisition of Shares of Silicon Motion Technology by U.S. Chip Manufacturer MaxLinear

On July 26, SAMR issued a public announcement stating that it has decided to approve the acquisition of shares of Silicon Motion Technology by MaxLinear, with the imposition of additional restrictive conditions. [22]

SAMR Suggests Listed Company Xinjufeng to Submit Merger Filing for Its Acquisition of Greatview Packaging

On July 4, SAMR issued a letter of advice to the listed company Xinjufeng, suggesting that it submit a merger filing for its acquisition of Greatview Packaging. [23]

Courts Litigation

Plaintiff Withdraws Lawsuit in the Dispute over Monopoly Agreement in the Second-hand Car Trading Market

On July 5, 2023, the Intermediate People's Court of Ningbo City of Zhejiang Province issued a civil ruling stating that the plaintiff has withdrawn the lawsuit in the dispute over monopoly agreements involving Zhuji Lianhua Used Motor Vehicle Trading Market Management Co., Ltd. and Zhuji Lianqiang Second-hand Car Trading Market Management Co., Ltd. [24]

Academia

China Releases First Research Report on Automotive Standard Essential Patents, Covering Industry, Policy, Judiciary, and Anti-Monopoly Aspects

On July 23, 2023, the 2023 China Automotive Innovation Conference was held in Changchun, Jilin. The China Automotive Technology Research Center and Peking University jointly released the Blue Book of Automotive Standard Essential Patents. This is the first comprehensive research report in this field in China. [25]

[1]<https://content-static.cctvnews.cctv.com/snow-book/index.html?item_id=2324366496169898352&toc_style_id=feeds_default&track_id=A0FD33E9-5F26-4A77-B3AB-017C87A42B2B_711452189630&share_to=wechat>

[2] <https://www.gov.cn/zhengce/202307/content_6893056.htm>

[3]<https://www.ln.gov.cn/web/hdjl/yjzj/dfxfg/2023070414465491068/index.shtml>

[4]<https://www.yn.gov.cn/zwgk/zcwj/zxwj/202307/t20230705_261779.html>

[5]<http://www.mohrss.gov.cn/xxgk2020/gzk/gz/202306/t20230630_502242.html>

[6]<https://www.samr.gov.cn/zw/zfxxgk/fdzdgknr/fldj/art/2023/art_6e48555bf6e04079bbabe2c358867cdf.html>

[7]<https://mp.weixin.qq.com/s/GYf4qVrQXUdyMN8zH6sGzQ>

[8]<https://baijiahao.baidu.com/s?id=1772565366474951769&wfr=spider&for=pc>

[9]<http://amr.hunan.gov.cn/amr/xxx/xtdtx/202307/t20230726_29411405.html>

 [10]<http://scjgj.cq.gov.cn/zwxx_225/bmdt/sj/202307/t20230725_12183605.html>

[11]<https://mp.weixin.qq.com/s/zLgrhBWCW7dbQ6g9kOesuw?scene=25#wechat_redirect

[12]<http://scjgj.xinjiang.gov.cn/xjaic/qjxx/202307/647142fce9c247a785eba71cffac06b7.shtml>

[13]<https://mp.weixin.qq.com/s/J22ZJ4L33-Fkxgu9hblTHg?scene=25#wechat_redirect

[14]<http://amr.hlj.gov.cn/amr/c103766/202307/c00_31650662.shtml>

[15]<https://www.cqn.com.cn/zj/content/2023-07/17/content_8959828.htm>

[16]<https://www.21jingji.com/article/20230712/herald/183ae261e49a6a38a4234710b8a1bba5.html>

[17]<https://www.huangshan.gov.cn/zxzx/zwyw/8389864.html>

[18]<https://www.samr.gov.cn/fldes/tzgg/xzjj/art/2023/art_cc4dfe434336485fb07e2209fd40d14d.html>

[19] <https://amr.ah.gov.cn/xwdt/gsgg/148466961.html> 

[20]<https://mp.weixin.qq.com/s/LwGd_6bNRii0V8uTpQXhCg?scene=25#wechat_redirect

[21]<https://wenshu.court.gov.cn/website/wenshu/181107ANFZ0BXSK4/index.html?docId=81uw4q6F26fixhQBJ7VAUKK8v7nWlDfxTMSDvqPNRte1cydIKc9+fp/dgBYosE2gbS6ISMUdPorySZ2hB0SmJZxB0lYWsY9O0hbe57aR9vIJOdxl68Fj70Z8b5WAbPQF> 

[22]<https://www.samr.gov.cn/fldys/tzgg/ftj/art/2023/art_b46495b0b7b0408ca0e1da77071679af.html>

[23]<http://www.szse.cn/disclosure/listed/bulletinDetail/index.html?d147d9c2-01df-4c98-809a-8476188e85b5=>

[24]<https://wenshu.court.gov.cn/website/wenshu/181107ANFZ0BXSK4/index.html?docId=GvdWoLTHX0W2L9AH2V0UeRzElVhNu4STXa3y9gjiVLz8VKCZM0X6xp/dgBYosE2gbS6ISMUdPooLctUv57UhGvRNz3mAzTfBiZsBKJ6bR4rpmbWVi8Hfdgrmb6v/cX6Z>

[25]<https://news.cctv.com/2023/07/24/ARTI3emL9KG110XPqO0KygRt230724.shtml>

Source: Beijing Dacheng Law Offices LLP - Jet Deng and Ken Dai

Editor: IPR Daily-Ann