China Mobile sued on anti-monopoly grounds

The AMEA (Anti-monopoly Enforcement Agencies) consist of three bodies. One is the State Administration of Industry and Commerce which is in charge of looking at abuses of dominant position, under Part Three of the Anti-monopoly Law. Article 17 specifies acts which may constitute an abuse (including bundling of products/services, imposing unreasonable trading conditions on trading counterparties, discriminating between counterparties with the same ability to execute a transaction, and refusing to deal or supply) and also provides “valid reasons” to excuse otherwise abusive activities.

But how this will work in practice is still unknown.

“So far there have been no reported decisions or judgments concerning the application of part three of the Anti-monopoly Law, nor has any further guidance been published by any AMEA body,” said Nicholson.

Since the new law came into force in August 2008, several other private actions have been brought against prominent domestic companies, with plaintiffs citing anti-competitive behaviour.

Lawyer Li Changqing filed a complaint against search engine company Baidu in October; a suit was also accepted against the Beijing branch of China Netcom, and another has been filed against China Petroleum & Chemical Corp (Sinopec).

At the time, Gerry O'Brien, a senior associate of JSM in Hong Kong, said it was unlikely that the courts would want to make their own interpretation of the provisions of the Law until the enforcement agencies provide some guidance. But these rules have not yet emerged, despite reports last year that some may be close to finalisation. The cases that have been brought, while not officially thrown out, appear to have stalled at the pre-trial stage.

“Once we have an enforcement regime that works, then often the best first option for parties with grievances will be to lodge complaints with the enforcement authorities, as they have the investigation powers and resources necessary to deal with these cases,” O'Brien told China Law & Practice this week.

“But the authorities are now focused on drafting implementation rules and readying their enforcement procedures, so it's not surprising some parties see private actions as offering the only way out at the moment,” he added.