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Goals of the Competition Law

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Competition Law in China

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Abstract

The AML incorporates five goals in Article 1: preventing and restraining monopolistic conduct, protecting fair competition in the market, enhancing economic efficiency, safeguarding the interests of consumers and social public interest, and promoting the healthy development of a socialist market economy. The revised AML adds one more goal: to promote innovation. The academic debate focuses on whether consumer welfare, efficiency or protecting fair competition should serve as a functional goal or the ultimate goal. It is believed that a more balanced approach should be adopted. The goal of promoting a socialist market economy is mentioned in Article 4. Industrial policy concerns on SOEs are reflected in Article 7 of the AML. The exemptions mentioned in Article 15 refer to the broad definition of public interest. A fair competition system has been implemented since 2017 to coordinate competition and industrial policy.

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Notes

  1. 1.

    Farmer (2013, p. 22).

  2. 2.

    Shan et al. (2011, p. 7).

  3. 3.

    Yi and Jung (2007, p. 156).

  4. 4.

    Yi and Jung (2007, p. 156).

  5. 5.

    Ding (2011, p. 128), Lyu and Tao (2008, p. 27).

  6. 6.

    Gao and Dong (2008, p. 97).

  7. 7.

    Li (2008).

  8. 8.

    Ding (2011, p. 128).

  9. 9.

    Lan (2016, p. 80).

  10. 10.

    Lyu and Tao (2008, p. 27).

  11. 11.

    Wu and Wei (2005, p. 98).

  12. 12.

    Sun (2008).

  13. 13.

    Yan (2005).

  14. 14.

    Lin (2009), Lin and Zhao (2012, p. 129).

  15. 15.

    Lin and Zhao (2012, p. 129).

  16. 16.

    Lin and Zhao (2012, p. 129).

  17. 17.

    Lin and Zhao (2012, p. 129).

  18. 18.

    Huang (2018, p. 126).

  19. 19.

    Zhongguo Gongchandang Di Shiyijie Zhongyang Weiyuanhui Disanci Quanti Huiyi Gongbao (中国共产党第十一届中央委员会第三次全体会议公报) [Communique of the Third Plenary Session of the Eleventh Central Committee of the Communist Party of China], December 22, 1978.

  20. 20.

    Zhonggong Zhongyang Guanyu Jingji Tizhi Gaige De Jueding (中共中央关于经济体制改革的决定) [Decision of the CPC Central Committee on Economic System Reform], October 20, 1984.

  21. 21.

    Zhonggong Zhongyang Guanyu Jianli Shehui Zhuyi Shichang Jingji Tizhi Ruogan Wenti De Jueding (中共中央关于建立社会主义市场经济体制若干问题的决定) [Decision of the Central Committee of the Communist Party of China on Several Issues Concerning the Establishment of a Socialist Market Economy], November 14, 1993.

  22. 22.

    Zhonggong Zhongyang Guanyu Wanshan Shehui Zhuyi Shichang Jingji Tizhi Ruogan Wenti De Jueding (中共中央关于完善社会主义市场经济体制若干问题的决定) [Decision of the Central Committee of the Communist Party of China on Some Issues Concerning the Improvement of the Socialist Market Economy], adopted at the 3rd Plenary Session of the 16th CPC Central Committee on October 14, 2003.

  23. 23.

    Gerber (2008, p. 277).

  24. 24.

    Gerber (2008, p. 277).

  25. 25.

    Wu and Wei (2005, p. 98).

  26. 26.

    Hamp-Lyons (2009, p. 1580).

  27. 27.

    Montinola et al. (1995, p. 52), Wang (2008, p. 133).

  28. 28.

    Shan et al. (2011, p. 6).

  29. 29.

    Hamp-Lyons (2009, p. 1580), see Footnote 15.

  30. 30.

    Fox (2007, p. 211, 228, 229).

  31. 31.

    Article 7 of the AML: With respect to the industries controlled by the State-owned economy and concerning the lifeline of national economy and national security or the industries lawfully enjoying exclusive production and sales, the State shall protect these lawful business operations conducted by the business operators therein, and shall supervise and control these business operations and the prices of these commodities and services provided by these business operators, so as to protect consumer interests and facilitate technological advancements. The business operators mentioned in the previous paragraph shall operate according to law, be honest, faithful and strictly self-disciplined, and accept public supervision, and shall not harm consumer interests by taking advantage of their controlling or exclusive dealing position. Translation adopted from en.pkulaw.cn.

  32. 32.

    Huang (2008, p. 119).

  33. 33.

    Liu and Qiao (2012, p. 103).

  34. 34.

    Liu and Qiao (2012, p. 104).

  35. 35.

    Williams (2009, p. 137).

  36. 36.

    Fox (2008, p. 178).

  37. 37.

    Fels (2012, p. 15).

  38. 38.

    Li (2017, p. 122).

  39. 39.

    Wang (2020, p. 12).

  40. 40.

    Guowuyuan Guanyu Cujin Qiye Jianbing Chongzu De Yijian (国务院关于促进企业兼并重组的意见) [Opinions of the State Council on Promoting Enterprise Merger and Restructuring], issued by State Council on August 28, 2010, effective on August 28, 2010.

  41. 41.

    Zhonggong Zhongyang Guanyu Quanmian Shenhua Gaige Ruogan Zhongda Wenti De Jueding (中共中央关于全面深化改革若干重大问题的决定) [Decision of the Central Committee of the Communist Party of China on Several Important Issues Concerning Comprehensively Deepening the Reform], issued on November 12, 2013.

  42. 42.

    Zhonggong Zhongyang Guowuyuan Guanyu Shenhua Guoyou Qiye Gaige De Zhidao Yijian (中共中央, 国务院关于深化国有企业改革的指导意见) [Guiding Opinions of the CPC Central Committee and the State Council on Deepening the Reform of State-owned Enterprises], issued by the State Council on August 24, 2015.

  43. 43.

    Guowuyuan Guoyou Zichan Jiandu Guanli Weiyuanhui Bangongting Guanyu Kaizhan Zhongyang Qiye “Shisanwu” Fazhan Zhanlue He Guihua Bianzhi Gongzuo De Tongzhi (国务院国有资产监督管理委员会办公厅关于开展中央企业 “十三五” 发展战略和规划编制工作的通知) [Notice of the General Office of the State-owned Assets Supervision and Administration Commission of the State Council on the Development of the 13th Five-Year Plan for Central Enterprises] effective on March 6, 2015.

  44. 44.

    Dai (2016), Ye (2017).

  45. 45.

    Zhonggong Zhongyang Guowuyuan Guanyu Shenhua Tizhi Jizhi Gaige Jiakuai Shishi Chuangxin Qudong Fazhan Zhanlue De Ruogan Yijian (中共中央、国务院关于深化体制机制改革加快实施创新驱动发展战略的若干意见) [Several Opinions of the CPC Central Committee and the State Council on Deepening the Reform of Systems and Mechanisms to Accelerate the Implementation of Innovation-driven Development Strategies, effective on March 13, 2015 (“Market Competition has the fundamental role to stimulate innovation, create a fair, open, and transparent market environment, strengthen the guidance of innovation by competition policies and industrial polices, promote the survival of the fittest, and enhance the innovation momentum of market players”).

  46. 46.

    Guowuyuan Zhuanpi Fazhan Gaigewei Guanyu 2015 nian Shenhua Jingji Tizhi Gaige Zhongdian Gongzuo Yijian De Tongzhi (国务院转批发展改革委关于2015年深化经济体制改革重点工作意见的通知) [Notice of the State Council on Approving and Forwarding the Opinions of the National Development and Reform Commission on the Pivotal Work of Deepening the Reform of the Economic System in 2015] issued by the State Council on May 8, 2015.

  47. 47.

    Guowuyuan Pizhuan Guojia Fazhan Gaigewei Guanyu 2016 nian Shenhua Jingji Tizhi Gaige Zhongdian Gongzuo Yijian De Tongzhi (国务院批转国家发展改革委关于2016年深化经济体制改革重点工作意见的通知) [Notice of the State Council on Circulating the Opinions of the National Development and Reform Commission on Deepening the Reform of the Economic System in 2016] effective on March 25, 2016.

  48. 48.

    Guowuyuan Guanyu Zai Shichang Tixi Jianshe Zhong Jianli Gongping Jingzheng Shencha Zhidu De Yijian (国务院关于在市场体系建设中建立公平竞争审查制度的意见) [Opinions of the State Council on Establishing A Fair Competition Examination System in the Building of the Market System] issued by the State Council on June 1, 2016, effective on June 1, 2016.

  49. 49.

    Guojia Fazhan Gaigewei, Caizhengbu, Shangwubu Deng Guanyu Yinfa Gongping Jingzheng Shencha Zhidu Shishi Xize Zanxing De Tongzhi (国家发展改革委, 财政部, 商务部等关于印发《公平竞争审查制度实施细则(暂行)》的通知) [Notice of the National Development and Reform Commission, the Ministry of Finance, the Ministry of Commerce and Other Departments on Issuing the Detailed Rules for the Implementation of the Fair Competition Review System (For Interim Implementation)], issued on October 23, 2017 and effective on October 23, 2017.

  50. 50.

    Guowuyuan Guanyu Yinfa Shisanwu Shichang Jianguan Guihua De Tongzhi (国务院关于印发 “十三五” 市场监管规划的通知) [Notice of the State Council on Issuing the Plan for Market Regulation During the 13th Five-Year Plan Period] issued by the State Council on January 12, 2017, effective on January 12, 2017.

  51. 51.

    Article 27 AML: In the case of the examination on the concentration of business operators, it shall consider the relevant elements as follows: (1) the market share of the business operators involved in the relevant market and the controlling power thereof over that market, (2) the degree of market concentration in the relevant market, (3) the influence of the concentration of business operators on the market access and technological progress, (4) the influence of the concentration of business operators on the consumers and other business operators, (5) the influence of the concentration of business operators on the national economic development, and (6) other elements that may have an effect on the market competition and shall be taken into account as regarded by the Anti-monopoly Authority under the State Council. Translation adopted from en.pkulaw.cn.

  52. 52.

    Article 28 of the AML: Where the concentration of business operators will or may eliminate or restrict competition, the Anti-monopoly Law Enforcement Agency under the State Council shall make a decision to prohibit the concentration. However, if the business operators can prove either that the favourable impact of the concentration on competition obviously exceeds the adverse impact, or that the concentration meets the public interests, the Anti-monopoly Law Enforcement Agency under the State Council may decide not to prohibit the concentration. Translation adopted from en.pkulaw.cn.

  53. 53.

    Wang (2008, p. 143).

  54. 54.

    Wang (2008, p. 142).

  55. 55.

    Wu and Jin (2009, p. 44).

  56. 56.

    Wu and Jin (2009, p. 44).

  57. 57.

    Wei (2013, p. 126).

  58. 58.

    Berry (2005, p. 143).

  59. 59.

    Berry (2005, p. 143).

  60. 60.

    Berry (2005, p. 148).

  61. 61.

    Berry (2005, p. 149).

  62. 62.

    Shangwubu Shishi Waiguo Touzizhe Binggou Jingnei Qiye Anquan Shencha Zhidu Youguan Shixiang De Zanxing Guiding (商务部实施外国投资者并购境内企业安全审查制度有关事项的暂行规定) [The Interim Measures on Relevant Matters Concerning the Implementation of Security Review of Mergers and Acquisitions of Domestic Enterprises by Foreign Investors] (issued by the Ministry of Commerce on 4 March 2011, effective on 5 March 2011), available at http://wzs.mofcom.gov.cn/article/n/201103/20110307432685.shtml.

  63. 63.

    Guowuyuan Bangongting Guanyu Jianli Waiguo Touzizhe Binggou Jingnei Qiye Anquan Shencha Zhidu De Tongzhi (国务院办公厅关于建立外国投资者并购境内企业安全审查制度的通知) [Notice of the General Office of the State Council on the Establishment of the Security Review System for Mergers and Acquisitions of Domestic Enterprises by Foreign Investors] (issued by the General Office of the State Council on 3 February 2011, effective on 3 March 2011).

  64. 64.

    Delury (2008, p. 35).

  65. 65.

    Goldstein (2011, p. 31).

  66. 66.

    Lin and Zhao (2012, p. 117).

  67. 67.

    Lin and Zhao (2012, p. 12). Lin and Zhao mentioned that Articles 9 and 12 of the Interim Provisions on Assessing the Impact of Concentration of Business Operators on Competition, See  Shangwubu Guanyu Pinggu Jingyingzhe Jizhong Jingzheng Yingxiang De Zanxing Guiding (商务部关于评估经营者集中竞争影响的暂行规定) [Interim Provisions on Assessing the Impact of Concentration of Business Operators on Competition] issued Announcement No. 55 (2011) of the MOFCOM issued on August 29, 2011 effective on September 5 2011. Lin and Zhao argued that in accordance with the provision, efficiency may be taken as a countervailing factor.

  68. 68.

    Lin and Zhao (2012, p. 127).

  69. 69.

    Lin and Zhao (2012, p. 127).

  70. 70.

    Shan et al. (2011, p. 7).

  71. 71.

    Shan et al. (2011, p. 7).

  72. 72.

    Shan et al. (2011, p. 8).

  73. 73.

    Shan et al. (2011, p. 26).

  74. 74.

    Berry (2005, p. 150).

  75. 75.

    Lan (2014).

  76. 76.

    Lin and Zhao (2012, p. 127).

  77. 77.

    Lin and Zhao (2012, p. 127).

  78. 78.

    Ying (2010).

  79. 79.

    Ding (2011, p. 128).

  80. 80.

    Ding (2011, p. 128).

  81. 81.

    Ding (2011, p. 128).

  82. 82.

    Yu (2012, p. 103).

  83. 83.

    Jiao (2017, p. 135).

  84. 84.

    Huang (2008, p. 118); International scholars have also argued that competition policy may not be served as a pre-condition for the development of the Chinese economy. See for example, Ulen (2011, pp. 13–44).

  85. 85.

    Huang (2008, p. 118).

  86. 86.

    Huang (2008, p. 118).

  87. 87.

    Ding (2011, p. 128).

  88. 88.

    Ding (2011, p. 128).

  89. 89.

    Ding (2011, p. 128).

  90. 90.

    Shang (2009, p. 4).

  91. 91.

    China has socialist market economy in place, People’s Daily Online, 13 July 2005, available at http://en.people.cn/200507/13/eng20050713_195876.html (accessed 28 March 2020).

  92. 92.

    Shang (2009, p. 4).

  93. 93.

    Responses to Reporters’ Requests to the Draft for Comments of the Judicial Interpretation of the Anti-monopoly Law from a Superintendent of Intellectual Property Tribunal of Supreme People’s Court (25 April 2011), cited by Farmer (2013, p. 15).

  94. 94.

    Zhao (2008).

  95. 95.

    Zhao (2008).

  96. 96.

    Zhao (2008).

  97. 97.

    Howell et al. (2009).

  98. 98.

    Wang (2004), Interview: Shang Ming: Anti-Monopoly Law is not only for Multinational Companies, Xinhua Net, 23 December 2004.

  99. 99.

    Wu (2008, p. 100).

  100. 100.

    Legislative Affairs Office of the State Council: The AML does not Affect Legitimate Mergers and Acquisitions of Enterprises (国务院法制办:《反垄断法》不影响企业正当并购), Xinhua Net, September 10 2007, available at http://news.sina.com.cn/c/2007-09-10/193212542684s.shtml (accessed 26 March 2020).

  101. 101.

    Wang (2004, p. 3).

  102. 102.

    Wang (2004, p. 3).

  103. 103.

    Kovacic et al. (2011, p. 31).

  104. 104.

    Yi and Jung (2007, p. 155).

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    Jingyuan Ma

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Ma, J. (2020). Goals of the Competition Law. In: Competition Law in China. Springer, Singapore. https://doi.org/10.1007/978-981-15-5105-5_3

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  • DOI: https://doi.org/10.1007/978-981-15-5105-5_3

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  • Publisher Name: Springer, Singapore

  • Print ISBN: 978-981-15-5104-8

  • Online ISBN: 978-981-15-5105-5

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