Antitrust guidelines for auto sector

On 6 August 2020, a new book authored by the State Administration for Market Regulation (SAMR) published a compilation of antitrust rules. It contained the long-awaited Antitrust Guidelines on the Automotive Sector, which provides a substantive set of additional rules that may prompt the original equipment manufacturers (OEMs) to re-evaluate their distribution models in China. Key highlights include:

(1) Resale price maintenance. Consistent with the SAMR’s enforcement practice, the auto guidelines take the view that resale price maintenance (RPM) should be largely prohibited. However, the guidelines set out new grounds for exemptions of RPM, and sketch out an exemption for RPM imposed on distributors, which “only play an intermediary role in the distribution process, i.e., where the pricing has been negotiated between OEMs and specific end customers already, and the distributor’s role is limited to the delivery of vehicles, receipt of payment or invoice issuance.