Mo­nop­oly law un­der re­vi­sion

Tools against anti-mar­ket fa­voritism to get 1st change in 10-year ex­is­tence

China Daily (Hong Kong) - - FRONT PAGE - By WANG YANFEI wangyan­fei@chi­nadaily.com.cn

China is re­vis­ing its anti-mo­nop­oly law, the first such move since the leg­is­la­tion took ef­fect 10 years ago. The draft by NDRC will be sub­mit­ted for re­view next month, ac­cord­ing to an of­fi­cial from the coun­try’s top eco­nomic plan­ner.

The re­vi­sion is ex­pected to in­cor­po­rate into law the fair mar­ket com­pe­ti­tion re­view sys­tem out­lined by the State Coun­cil, the na­tion’s Cab­i­net, ac­cord­ing to an of­fi­cial from the Na­tional De­vel­op­ment and Re­form Com­mis­sion with di­rect knowl­edge of the mat­ter who de­clined to be named.

Of­fi­cials from lo­cal gov­ern­men­tal reg­u­la­tory bod­ies will be held ac­count­able for ad­min­is­tra­tive mo­nop­oly abuses such as grant­ing fa­vor­able con­di­tions to pre­ferred en­ter­prises at the ex­pense of other mar­ket play­ers, the of­fi­cial said.

Once the draft is ap­proved by the Na­tional Peo­ple’s Congress, the coun­try’s top leg­isla­tive body, it will be il­le­gal for pol­i­cy­mak­ers to cre­ate pref­er­en­tial poli­cies to fa­vor cer­tain com­pa­nies or limit their mar­ket ac­cess.

Based on its past law en­force­ment ex­pe­ri­ences, the NDRC hopes that some un­clear ar­eas that may cause con­fu­sion can be bet­ter ad­dressed in the re­vi­sion of the leg­is­la­tion, the of­fi­cial said.

The of­fi­cial said the draft ver­sion is ex­pected to be sub­mit­ted to the State Coun­cil for re­view by the end of this month.

Wang Jun­lin, a Bei­jing­based lawyer spe­cial­iz­ing in in­ter­na­tional com­merce and busi­ness com­pe­ti­tion, said the re­vi­sion, if ap­proved by the top leg­is­la­ture, would mark a huge step for­ward by China as it im­proves its anti-mo­nop­oly law en­force­ment.

In 2016, the State Coun­cil pub­lished guide­lines on

es­tab­lish­ing a fair com­pe­ti­tion re­view sys­tem, re­quir­ing lo­cal pol­i­cy­mak­ers and reg­u­la­tors to per­form self-re­views be­fore is­su­ing poli­cies re­lated to the eco­nomic ac­tiv­i­ties of mar­ket play­ers.

De­spite the guide­lines, some lo­cal au­thor­i­ties re­port- edly have dis­re­garded the sel­f­re­view process since it was not manda­tory.

The NDRC cracked down on 18 cases in 2016 in­volv­ing lo­cal gov­ern­ments found to have aided en­ter­prises’ price­fix­ing by is­su­ing dis­crim­i­na­tory con­di­tions for mar­ket en­try or re­quir­ing busi­nesses to use goods and ser­vices pro­vided by des­ig­nated pro­duc­ers in the util­i­ties, tourism, cloth­ing and build­ing ma­te­ri­als in­dus­tries.

Shi Jianzhong, vice-pres­i­dent of China Univer­sity of Po­lit­i­cal Science and Law, said by putting fair mar­ket com­pe­ti­tion into leg­is­la­tion, it is no longer just a re­minder for lo­cal gov­ern­ments.

“It can be used as a pre­ven­tive tool for law en­force­ment agen­cies. Cur­rently, au­thor­i­ties launch in­ves­ti­ga­tions only af­ter du­bi­ous ac­tiv­i­ties are found,” he said.

Zhang Qiong, an ex­pert and con­sul­tant for the An­tiMonopoly Com­mit­tee of the State Coun­cil, said anti-mo­nop­oly law en­force­ment is ex­pected to ex­pand to new ar­eas, such as ar­ti­fi­cial in­tel­li­gence, big data and other new, emerg­ing in­dus­tries.

Law en­force­ment agen­cies will be re­quired to adapt to new mar­ket de­vel­op­ments, ac­cord­ing to Zhang.

Cy­bere­con­omy is ex­pected to be­come a new area that the law en­force­ment agen­cies will watch closely, ac­cord­ing to Deng Zhisong, a se­nior part­ner at the Bei­jing of­fice of the Den­ton global law firm.

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