On 1 February 2011, the Chinese competition landscape will be almost complete, with implementing rules issued in early January by the National Development and Reform Commission (NDRC) and the State Administration for Industry and Commerce (SAIC) (the Implementing Rules) set to enter into force.
These Implementing Rules provide more detailed guidance regarding some of the basic concepts and prohibitions contained in the Anti-monopoly Law (AML), which marked its second anniversary in August 2010. In this e-Alert, we summarise the key features of the new Implementing Rules, and highlight those aspects of the Implementing Rules that are likely to be of major interest to businesses operating in China.
Following the entry into force of the AML in August 2008, the State Council quickly set about allocating enforcement authority for the various aspects of the law amongst its subsidiary administrative departments. Thus, the Ministry of Commerce (MOFCOM) was tasked with the enforcement of the merger-related aspects of the AML, the NDRC with policing price-related monopolistic behaviour by business undertakings, and the SAIC with policing non-merger-related monopolistic behaviour more generally. Over the course of the past two-and-a-half years, each of these three AML enforcement agencies has embarked on a process of developing detailed legislative guidance regarding the specific aspects of the AML within its respective remit. The progress of the NDRC and SAIC in this respect has been decidedly slower than MOFCOM, whose merger control regime was firmly in place by the end of 2009. SAIC, for example, has previously issued two sets of draft implementing rules for public comment, first in June 2009 and then again in May last year. The NDRC, meanwhile, released a draft version of its rules on price-related monopolistic conduct in August 2009. There was some speculation that disputes between the two authorities as to their respective jurisdictions was responsible for the delays. Following the formal issuance by the NDRC and SAIC of final versions of their respective laws during the first weeks of January, however, the suite of detailed implementing rules under the AML is now virtually complete.
The implementing rules
The new regulations issued by the SAIC comprise the following (together, the SAIC Rules):
Provisions of the Administration for Industry and Commerce for the Prevention of the Abuse of Administrative Powers to Exclude or Restrict Competition;
Provisions of the Administration for Industry and Commerce on the Prohibition of Acts Involving Monopolistic Agreements; and
Provisions of the Administration for Industry and Commerce on Prohibiting the Abuse of a Dominant Market Position.
The new regulations issued by the NDRC comprise the following (together, the NDRC Rules):
Provisions on Anti-monopolistic Pricing; and
Provisions on Administrative Enforcement Procedures on Anti-monopolistic Pricing.
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