Get ready for more enforcement

b. Did you expect these changes?

Private enforcement of anti-monopoly law is one of the essential integral parts of the entire enforcement of ministerial level laws in other relatively mature jurisdictions. To date, enforcement of the Anti-monopoly Law in China has largely relied on the power of the public authorities, but the issuance of the Judicial Interpretation, supports, at least from a systemic perspective, the value of the existence of private enforcement.

2. What developments are in the running for the next 12 months?

In the coming year, the developments that we are anticipating include:

Further improvement of the legal system

A legal system always requires continuous improvement in enforcement as this is the only way that it can become more reasonable and more pertinent. In the five years that the Anti-monopoly Law has been formally implemented, the authorities have accumulated extensive law enforcement practical experience. We anticipate that, in the coming year, the various authorities will further improve the existing systems by combining practical experience with means such as legislation or legal interpretations.

More specifically, in the civil procedure field, we anticipate the issuance of more detailed and practicable interpretations addressing the standing of entities involved in civil procedures, litigation methods and the issue of the dovetailing of civil procedure with administrative law enforcement. With respect to review of concentrations of business operators, we anticipate the establishment of a simplified procedure system and the formal issuance of regulations on the attachment of restrictive conditions to concentrations of business operators. As for administrative investigation, we are anticipating the formal issuance of guidelines for anti-monopoly law enforcement in the intellectual property field, the publication of guidelines on the issue of monopolistic agreements in certain industries and explanations of suspected illegal monopolistic acts other than those expressly set forth in the Anti-monopoly Law.

Greater transparency in law enforcement

The degree of transparency in the enforcement of the Anti-monopoly Law has increased markedly in the past year. In the civil procedure field, the decisions in two cases that have relatively great influence (the Qihoo 360 v Tencent abuse of dominant market position case and the Rainbow Medical v Johnson & Johnson vertical monopolistic agreement case) were made public, with the trial at first instance in the Qihoo case even being broadcast live on the internet. In the administrative investigation field, the National Development and Reform Commission (NDRC) and State Administration for Industry and Commerce (SAIC) published the details of their investigations of major cases on government home pages or in domestic mainstream media. Furthermore, with respect to review of concentrations of business operators, since last year, the Ministry of Commerce (MOFCOM) has regularly published the names and filing dates of all concentration reviews since the entry into effect of the Anti-monopoly Law. It can be said that the various anti-monopoly authorities have made great efforts to enhance the transparency of law enforcement.

We hope that, in the coming year, the authorities can continue in this spirit, disclosing to the public more information on the application of discretion involved in the admission of facts, interpretation of the law, law enforcement and review processes, thereby further increasing the transparency of law enforcement.

Increase in the number and influence of cases

With the accumulation of experience by the anti-monopoly law enforcement authorities and the increase in the competition awareness of the public, we foresee that there will be more anti-monopoly law enforcement and civil anti-monopoly cases in the coming year. The status of the Anti-monopoly Law in the overall legal system will also rise and genuinely fulfil its role as the “constitution of the economy”.

3. Over the past 12 months, have you seen the Anti-monopoly Law applied fairly to both domestic and foreign businesses?

Objectively speaking, the implementation of the Anti-monopoly Law in China has essentially achieved equality between domestic and foreign companies. Among the cases investigated and dealt with by the NDRC and the SAIC, a large percentage have targeted the acts of domestic enterprises. In terms of the amounts of the fines imposed, no special consideration has been given to domestic enterprises either. For example, in the Maotai/Wuliangye case investigated and dealt with by the NDRC at the beginning of 2013, each company was fined in excess of Rmb200 million, the highest fine amounts imposed in all final administrative investigation cases to date.

4. What are some the highlights of the year regarding AML cases? How do these help in understanding how the AML law is applied?

The anti-monopoly cases in the past year whose influence is relatively high include:

LCD case

Strictly speaking, the LCD case was in fact investigated and handled under the Pricing Law because the violation occurred before the the Anti-monopoly Law came into effect. However, this case involved typical cartel behaviour, targeted what is in global anti-monopoly enforcement history a very representative case and the law enforcement process additionally involved the application of extremely important systems under the Anti-monopoly Law, i.e. the tip reporting system and the leniency system. Accordingly, it will, in respect of future law enforcement relating to horizontal agreements under the Anti-monopoly Law, have extremely valuable referential significance.

Maotai/Wuliangye case

The Maotai/Wuliangye case is the first vertical monopolistic agreement case investigated and dealt with under the Anti-monopoly Law available through public channels. Furthermore, as at July 2013, the fines imposed are the largest ever imposed in any administrative investigation case.

Qihoo 360 vs Tencent

This abuse of dominant market position case is the first civil procedure case available through public channels in which systematic professional anti-monopoly legal and economic analyses were carried out and is, to date, the civil anti-monopoly case available through public channels with the highest subject amount.

5. What practical advice would you give to foreign companies about to engage in an acquisition that would trigger an AML review?

Do not overlook the effect that a China review of a concentration of business operators could have on a transaction. As in the majority of jurisdictions, a review of a concentration of business operators in China takes the form of advance filing. That is to say that a transaction that requires a filing may not be carried out until the review approval decision has been obtained. As China has not yet established a rapid review mechanism, and as MOFCOM has relatively few case handling officers, the time required for case reviews is relatively long. Accordingly, we have seen numerous transactions that are held up for a long time because the China review of the concentration of business operators has not passed, which has a significant impact on the company. It is best if an enterprise can, at the acquisition transaction feasibility assessment stage, consider the requirements for the review of the concentration of business operators in all jurisdictions, including China.

6. There has been much talk about MOFCOM streamlining the approval process for simple mergers. How will these simple mergers be classified and who will it affect?

The principal criterion for the simplified review procedure for business operator concentrations is the shares of the relevant market of the business operators involved in the concentration. Accordingly, the soon to be issued simplified procedure system will greatly increase the speed of reviews of the acquisition transactions of certain financial investors and of transactions that will have a minimal impact on the China market. Furthermore, the establishment of the simplified procedure system may help concentrate the limited review resources on cases that could have the effect of eliminating or limiting competition, thereby accelerating to a certain extent the speed of reviews of cases not subject to the simplified procedure.

7. MOFCOM closely scrutinises M&A transactions. In your experience what is their focus during merger review and how do their practices compare with other foreign competition regulators?

In reviewing a business operator concentration, one of the factors that MOFCOM pays the closest attention to is the shares of the relevant market of the business operators involved in the concentration. This point is consistent with other jurisdictions. There are, however, also some differences in the review process. For example, MOFCOM's requirements in respect of the definition of the relevant market are comparatively stringent, whereas in jurisdictions such as the EU and the US, the importance of defining the relevant market is gradually declining.

8. What has been the highlight of your competition cases over the past 12 months and why was it challenging?

During the past year, we accepted many types of anti-monopoly cases, one of which was acting as counsel in the Qihoo 360 v Tencent abuse of dominant market position case. During the first few years after the entry into effect of the Anti-monopoly Law, the anti-monopoly business in China mainly consisted of business operator concentration filings. Although there was a small surge of anti-monopoly actions as early as 2008, in many cases there were no professional anti-monopoly legal and economic analyses and the adducement of evidence was also rather haphazard. Even more turned on a subjective perception of the term “anti-monopoly”.

We, on the other hand, in acting as counsel in this case, expended a great deal of effort in anti-monopoly legal analysis and economic analysis, carrying out detailed research and discussion on the definition of relevant market, constitution of abuse and determination of the effect of eliminating or limiting competition. Furthermore, we also brought in expert witnesses to participate in the court investigation for the first time. When the trial at first instance began in the Guangdong Provincial Higher Court in May 2012, it attracted the attention of a wide swathe of the public. The case has yet to conclude and has become the first anti-monopoly litigation case to go to appeal before the Supreme People's Court. However the case ultimately plays out, its effect on civil Anti-monopoly Law actions in China cannot be ignored.

9. If you had to give one piece of practical advice to foreign clients about the competition regime in China, what would it be?

Do not for a moment believe the adage that “the law does not punish when there is a surfeit of perpetrators” or the claim that “there is no precedent for punishment”. The Anti-monopoly Law in China has only been implemented for a short time, and many punishments that have been published recently are without precedent. Many multinational corporations have been assiduous in their legal compliance work in jurisdictions with sound anti-monopoly laws, but in China have followed the old saying of “when in Rome, do as the Romans do”, treating lightly Anti-monopoly Law compliance work. Such an attitude of relying on luck could result in the company incurring huge losses. Thus, we would recommend that, despite the fact that enforcement of the Anti-monopoly Law in China is only finding its feet, it still deserves to be treated with great seriousness so as to nip any problems in the bud.

Author biography

Susan Ning

Susan joined King & Wood Mallesons in 1995. She is a senior partner and the head of the International Trade, Antitrust & Competition Group. She is one of the first legal practitioners in China to set up an Antitrust and Competition specialist division.

Susan's current practice focuses on two main areas: securing MOFCOM merger clearance for clients; and advising on AML compliance issues. Since the enactment of the AML, Susan has undertaken more than 100 antitrust merger control filings on behalf of blue-chip clients, which consist mostly of multinational companies.

Susan took a very active role in terms of assisting and counselling with the Chinese Government on the enactment of the AML, and on drafting regulations and guidelines accompanying the AML. Through these consultations (and through her prior work with the Chinese Government on WTO issues), Susan has built and maintained a close working relationship with the antitrust authorities in China.

She is the deputy Chairman of the Antitrust Committee of the China Lawyers Association and is an active participant of the American Bar Association's antitrust forum. Susan holds a Bachelor of Laws from Peking University and a Masters in Law from McGill University. Susan was admitted as a Chinese lawyer in 1988.

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预备迎接进一步的执法

金杜律师事务所的宁宣凤律师回顾了过去一年包括奇虎诉腾讯案等的重大竞争法案件和法律动向，并对来年的发展作出预测

1. 过去12个月，有什么影响竞争法的主要法规出台？

过去一年最重要的反垄断立法，是最高人民法院审判委员会于2012年5月3日公布，自2012年6月1日起施行的《最高人民法院关于审理因垄断行为引发的民事纠纷案件应用法律若干问题的规定》（以下简称“反垄断司法解释”）。

a. 法规如何影响竞争法体系？

《反垄断司法解释》共16条，涵盖了适用范围、原告资格、管辖、举证责任分配、垄断民事纠纷案与反垄断行政执法的关系、赔偿责任、诉讼时效等重要问题。对于中国反垄断民事诉讼的开展具有非常重要的指导意义。

b. 您有否预期到法规会带来这样的改变？

反垄断法的私人执行在其他比较成熟的司法辖区是整个部门法执行的一个不可或缺的组成部分。中国《反垄断法》到目前为止还是以公权力执行为主，但是《反垄断司法解释》的出台，至少从制度上支持了私人执行的存在价值。

2. 未来12个月内，将有什么新的发展？

在未来的一年中，我们期待的发展包括：

法律制度进一步完善

法律制度总是需要在执行过程中不断完善，才能更加合理、更具针对性。《反垄断法》正式实施五年来，主管机关已经积累了丰富的执法实践经验。我们期待在未来的一年中，各主管机关能够结合实践经验，通过立法或法律解释的方式，对于现有制度进一步完善。

具体而言，在民事诉讼领域，我们期待就民事诉讼主体资格、诉讼方式及民事诉讼和行政执法的衔接问题出台更为细化和有操作性的解释；经营者集中审查方面，我们期待简易程序制度的建立和关于经营者集中附加限制性条件规定的正式出台；行政调查方面，我们期待着有关知识产权领域反垄断执法的指南的正式出台，部分行业垄断协议问题的指南的公布，以及对于除《反垄断法》明确列明的垄断行为外，其他涉嫌违法的垄断行为类型的说明。

执法更具透明度

《反垄断法》的执法透明度在过去的一年有了非常明显的提高。在民事诉讼领域，两起影响比较大的案件（奇虎诉腾讯滥用市场支配地位案和锐邦诉强生纵向垄断协议案）均对公众公开了审判决定，其中奇虎案的一审庭审过程还进行了网络直播。在行政调查领域，发改委和工商总局对于重大案件的调查情况，均在政府主页上或通过国内主流媒体进行了公布。而经营者集中审查方面，商务部更是从去年起，将自《反垄断法》生效以来所有集中审查的案件名称和申报日期予以定期公布。可以说，各反垄断主管机关在提高执法透明度方面做出了不可忽视的努力。

在未来的一年，我们希望各主管机关能够延续这一精神，向公众披露更多涉及事实采信、法律解释、执法和审查过程等有关如何适用自由裁量权的信息，进一步增加执法的透明度。

案件数量增加，影响力提升

随着反垄断执法机关经验的积累和公众竞争意识的提升，我们预计在未来的一年，会有更多的反垄断执法和反垄断民事诉讼案件。《反垄断法》在整个法律体系中的地位也会进一步提升，真正发挥其“经济宪法”的作用。

3. 过去12个月，您认为《反垄断法》的执行是否对中外投资者一视同仁？

客观地讲，中国《反垄断法》的执行基本做到了“中外平等”。在发改委和工商总局查办的案件中，很大比例都是针对国内企业的行为。在针对垄断行为的处罚金额上，也没有对国内企业有特殊照顾，比如发改委2013年初查办的茅台/五粮液案中，两家公司各自的罚款金额均超过了人民币两亿元，是目前已经审结的行政调查案件中罚款金额最高的。

4. 过去一年，有什么重大的反垄断案件？这些案件如何帮助我们了解《反垄断法》的执行？

过去一年的时间中影响比较重大的反垄断案件包括：

LCD案（LCD case）

严格地讲，LCD案其实是在《价格法》下查处的，因为违法行为发生在《反垄断法》生效以前。但是这起案件涉及了典型的卡特尔行为，并且针对的是全球反垄断执法史中非常具有代表性的案件，执法过程中还涉及了举报制度、宽大制度等重要的《反垄断法》下非常重要的制度的运用，因此对于《反垄断法》有关横向协议未来的执法有非常宝贵的借鉴意义。

茅台/五粮液案（Maotai/Wuliangye case）

茅台/五粮液案，是在公开渠道所获知的第一起在《反垄断法》下查处的纵向垄断协议案件。并且截至2013年7月，该案的罚款金额是所有行政调查案件中处罚金额最高的。

奇虎诉腾讯滥用市场支配地位案（Qihoo 360 v Tencent）

从公开渠道可以获知的第一起进行系统性专业反垄断法律和经济分析的民事诉讼案件，也是目前公开渠道所知的诉讼标的最高的反垄断民事诉讼案件。

5. 对于将参与可能会引发反垄断审查并购的外国企业，您有什么建议？

不要忽略中国经营者集中审查对于交易的影响。

如大多数司法辖区一样，中国的经营者集中审查采取事先申报的形式。也就是说，需要进行申报的交易在取得审查批准决定以前，是不得实施的。由于中国目前尚未设立快速审查机制，并且由于商务部办案人员数量较少，案件审查的时间比较长，因此我们看到有许多交易由于中国经营者集中审查没有通过而屡屡延期，对于公司造成了一定程度的影响。企业在进行并购交易可行性评价的阶段，最好就能够将包括中国在内的各司法辖区对经营者集中的审查要求考虑在内。

6. 对于商务部简化对简单并购的审查程序，引起了广泛讨论。如何界定简单并购？哪些投资者或交易会受惠？

经营者集中简易审查程序的标准，主要是参与集中的经营者在相关市场的市场份额。所以对于一些财务投资者的并购交易、以及对中国市场影响很小的交易来说，即将出台的简易程序制度将能够极大加快其审查速度。另外，简易程序制度的确立，可以使有限的审查资源集中在可能具有排除限制竞争效果的案件上，从而在一定程度上加快非简易案件的审查速度。

7. 商务部严格审核并购交易，根据您的经验，他们审查的重点是什么？他们的要求与国外其他竞争法管理机关相比有什么不同？

商务部在审查经营者集中的过程中，最关注的一个因素是参与集中的经营者在相关市场的市场份额。这一点与其他司法辖区的主管机关是一致的。在审查的过程中，也存在一些差别，例如商务部对于相关市场界定的要求比较严格，而诸如欧盟和美国等司法辖区，正在逐渐淡化相关市场界定的重要性。

8. 请列举一起您在过去12个月所处理过的重大案件。案件有什么具挑战性的地方？

奇虎诉腾讯滥用市场支配地位案。

在过去的一年，我们承接了更多类型的反垄断案件，其中就包括代理奇虎诉腾讯滥用市场支配地位案。在《反垄断法》生效后的前几年间，国内的反垄断业务基本上是以经营者集中申报为主的。虽然早在2008年就有了一波反垄断诉讼的小高潮，但其中很多案件都没有专业的反垄断法律和经济分析，举证等方面也比较随意，更多是停留在对于“反垄断”的感性认识上。

而我们在代理这起案件中，做了大量的反垄断法律分析和经济分析的工作，从相关市场界定，到滥用行为的构成，以及排除、限制竞争效果的认定，均进行了详尽的研究和论证，而且还首次引入了专家辅助人参与法庭调查。2012年5月份案件在广东省高院一审开庭时，引起了公众广泛的关注。这个案件目前尚未审结，并成为第一起在最高人民法院进行二审的反垄断诉讼案件。不论案件最终的结果如何，它对于中国《反垄断法》民事诉讼的影响都会是不可忽略的。

9. 如果要您向外国客户提出一项关于竞争法的具体建议，哪会是什么？

不要存在“法不责众”，以及“没有处罚先例”的侥幸心理。中国《反垄断法》的实施时间还很短，近期公布的许多处罚都是前所未有的。许多跨国公司在反垄断法完善的司法辖区相关的合规工作做得很好，但是在中国却“入乡随俗”，不重视反垄断法合规工作，这种侥幸的心理可能会给公司造成巨大的损失。因此我们建议，尽管中国《反垄断法》的执法刚刚起步，也一定要引起重视，防患于未然。