The Chinese government announced on March 13, 2018, that it will consolidate the duties of three competition agencies into a new government agency to handle all antitrust matters. While it is too early to tell how this reorganization will impact China’s review of transactions and conduct cases, we believe that this change could lead to greater consistency and potentially more experienced attorneys reviewing competition matters. Access the full article.
Resale Price Maintenance in China: Enforcement Authorities Imposing Large Fines for Anti-Monopoly Law Violations
by Henry L.T. Chen, Frank Schoneveld, Alex An and Jared Nelson Recently Shanghai High People’s Court reached a decision in the first lawsuit involving resale price maintenance (RPM) since China’s Anti-Monopoly Law (AML) came into effect five years ago. Shortly thereafter, a key enforcement agency announced RPM-related fines against six milk powder companies, five of which are non-Chinese. Both cases clearly show that RPM can be a violation of the AML, and that RPM is currently under much greater scrutiny by enforcement authorities. It would be prudent for all foreign corporations active in China’s consumer markets to take heed of these changes in China and conduct an immediate review of any potential RPM violations. To read the full article, click here.
by Frank Schoneveld Corporations doing business in China, based on their intellectual property (IP) rights, need to be aware of the potentially serious impact of China’s Anti-Monopoly Law and other antitrust rules. China’s Anti-Monopoly Law prohibits the holder of IP rights from abusing those rights when it has a dominant market position. Such dominance can be achieved under Chinese law with a market share as low as 10 percent. Two recent cases demonstrate the greater reliance of Chinese companies on the antitrust rules, particularly when bargaining for lower royalties and license fees. Interdigital v. Huawei The Shenzhen Intermediate Court recently decided that Interdigital abused its patent rights by requiring Huawei to pay “excessive” royalties for essential patents for mobile telephone technology. The license terms proposed by Interdigital to Huawei reportedly complied with the European Telecommunications...
China’s Ministry of Commerce Announces Investigations into Failures to Notify a Concentration, Introduces New Transparency Measures
by Henry L.T. Chen, Frank Schoneveld, Jared Nelson and Sean Pan China’s Ministry of Commerce recently announced that it opened four investigations during 2012 into suspected non-compliance with China’s merger control notification procedures. The outcomes of the investigations are still uncertain, but the actions clearly show increased efforts to ensure compliance through enforcement of the law. Although the number of investigations was fairly low in 2012, the four cases are part of a new, larger trend of enforcement that began with a 2011 announcement to prioritize these investigations and was reinforced by new interim measures aimed at specifying compliance obligations and enforcement procedures. Multinational companies with operations in China are encouraged to increase compliance efforts in this area in order to avoid becoming targets of this new enforcement priority. To read the full article, click here.
by Henry L.T. Chen, Frank Schoneveld, Jared Nelson and Sean Pan Several major actions taken against price-fixing cartels by China’s enforcement authorities in the last year have sent a clear message that this is not a temporary campaign. It is a new reality. To read the full article, click here.
by Henry L.T. Chen, Frank Schoneveld and Alex An A Shanghai court recently decided the first case involving vertical monopoly agreements (i.e., between supplier and distributor) since China’s Anti-Monopoly Law (AML) came into effect in 2008. Of note, the court found that resale price maintenance by itself does not constitute a monopoly agreement. However, given that other courts and AML enforcement authorities can impose fines for illegal resale price maintenance, market players should not assume the practice is legal in China. To read the full article, click here.
by Henry L.T. Chen and Frank Schoneveld. Recently, the Supreme People’s Court of China issued final rules to build a working framework for civil anti-monopoly cases brought under the country’s Anti-Monopoly Law. The rules will take effect on 1 June 2012. To read the full article, please click here.
by Henry L.T. Chen and Frank Schoneveld Recently, the High People’s Court of Guangdong held a public hearing for a high-profile lawsuit involving two software giants and alleged abuse of a dominant market position. This is the first anti-monopoly case accepted by the court, and the claimed amount is RMB 150 million (approximately US$23.8 million). With few judicial precedents in China, this case will be watched closely, and its outcome is expected to have far-reaching implications. To read the full article, click here.
by Henry L.T. Chen, Frank Schoneveld, Alex An, Brian Fu and Angel Wang McDermott Will & Emery has released the latest China Law Alert: Focus on Competition, which provides insight on current issues surrounding cross-border antitrust and transactional issues. China’s New Merger Control Regime Makes Major Progress in Its First Three Years It is now just more than three years since China’s Anti-Monopoly Law (AML) was introduced. Compared with the well-established practices of US antitrust and EU competition authorities, AML enforcement is still in its infancy. However, China’s AML regulators, especially the authority in charge of merger control, the Ministry of Commerce (MOFCOM), has moved quickly to make its mark on international business. Now, most large, cross-border mergers, acquisitions and joint ventures must also successfully pass the rigors of review by MOFCOM as well as the European Commission and the US Department of Justice...
by Henry L.T. Chen, Frank Schoneveld and Alex An Recently,China’s National Development and Reform Commission (NDRC) imposed large fines on two pharmaceutical distributors. This move indicates the enforcement agency, which supervises price-related monopolistic practices, is beginning to take a more active role in enforcing the country’s Anti-Monopoly Law. To read the full article, click here.