Antitrust litigation: 2016 review, outlook for 2017

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Antitrust civil litigation in China is flourishing. Statistics shows that in 2016 the people’s courts issued 46 decisions on antitrust disputes. Among them, 16 involved monopoly agreements, 17 abuses of market dominance, and 14 administrative monopolies. Once case involved both. The numbers demonstrate that antitrust civil litigation in each category of the Anti-Monopoly Law’s (AML) prohibitions is roughly equivalent, which implies that the AML is experiencing a balanced development. This article reviews key cases in 2016, and on that basis an outlook of antitrust litigation is provided.

2016 CASES AND KEY POINTS

The people’s courts adopt different approach to find whether vertical restraints violate the AML. The people’s courts analyzed the competitive effect of vertical restraints as early as 2013, when Ruibang filed an antitrust civil litigation against Johnson & Johnson. In 2016, the courts adopted similar approaches to decide whether the vertical restraints imposed by Panasonic and GREE were contrary to the AML. The courts recognized that vertical restraints had pro-competitive effects. Vertical restraints were prohibited when there was no sufficient competition in the relevant markets and business operators had market power. Only in that circumstance can the restrictive effects of intra-brand competition cause adverse effects on inter-brand competition.

Huang Wei Managing Partner, Beijing Tian Yuan Law Firm
Huang Wei
Managing Partner, Beijing Tian Yuan Law Firm

Although the National Development and Reform Commission (NDRC) invoked article 14 of the AML to investigate and penalize Medtronic, GM and Hankook Tire, generally the courts were cautious in finding vertical restraints as being contrary to the AML. Whereas vertical restraints have been prevalent and differences between the approaches of the courts and the NDRC do exist, business operators that have received administrative sanctions may also file administrative litigations to review the respective administrative decisions. This cautious approach could thus facilitate the development of antitrust administrative litigation.

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Huang Wei is a senior and managing partner at Beijing Tian Yuan Law Firm, and general secretary of the anti-monopoly committee at the All China Lawyers Association. He can be contacted on + 86 10 5776 3888 or by email at hwei@tylaw.com.cn

Han Guizhen, a senior associate at Tian Yuan Law Firm, and Rebecca Yin, an associate at the firm, co-authored this article

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