In the news: China's vaccination scandal sparks drug safety fears, the MIIT's new draft rules target internet domains and Anbang ups its Starwood offer
March 30, 2016 | BY
Katherine JoThis week the WHO urged China to further regulate privately sold vaccines, China's internet regulator issued draft rules to block foreign websites and Anbang raised its bid to $14 billion in the biggest hotel takeover battle yet
The World Health Organization (WHO) has urged China to strengthen its oversight of private immunizations. Vaccines sold in the private market aren't held to the same standards as those through the government-managed channel, said an immunization expert at the UN health body's China office. Private distribution stood at the heart of a scandal in which a pharmacist in Shandong province was found selling nearly expired vaccines to clinics across the country for several years. More than 130 people involved were detained and 20,000 doses were seized. Investigators also uncovered a long-standing collusion where government clinics have been selling expired or near-expired vaccines on the cheap to vendors, who then resold them to other clinics, especially in remote areas. China has run a nationwide program administering a set of free vaccinations for diseases such as polio and measles since the 1970's, whereas other vaccinations, such as those for flu and rabies, sold in the private market have been criticized for being under-regulated and under-supervised. The WHO has asked China to expand its set of free vaccines. Recent scandals and rising fears over drug safety have prompted regulators to be more vocal about cracking down on distribution channels. China's legislators tend to react quickly to issues that hit headlines and cause social unrest (take food safety, for instance). The CFDA will probably release rules targeting the drug supply chain—and most likely entailing heavy criminal liability—soon.
More from CLP:
The Ministry of Internet and Information Technology (MIIT) issued on Monday draft revisions to regulations on internet domain names, which could prohibit China's internet service providers (ISPs) from allowing connections to websites with domains or web addresses registered outside the country. Violators would face fines of up to Rmb30,000 ($4,621) and public name-shaming. The draft is open for public comment until April 25. This is the latest move to increase government control over the internet. In January, the Cyberspace Administration of China issued draft rules requiring news services to remove any content that harm socialist values and national interests. The following month, the MIIT and media regulator jointly issued new regulations that ban companies with foreign ownership from engaging in online publishing. This draft also marks the trend of the government increasing liability on ISPs—in the past 2-3 years courts have taken a harsher stance on ISPs in disputes involving IP infringement, and in November ISPs were required to actively remove copyright-infringing content from their cloud networks. A Baidu rep said the company will be looking into the new rules.
More from CLP:
Starwood Hotels & Resorts Worldwide received a higher $14 billion takeover offer from a consortium led by China's Anbang Insurance Group, raising the stakes for Marriott International to counter—for the second time—in order to salvage a merger that would create the world's largest hotel operator. Marriott has worked on the acquisition since November, when Starwood first agreed to be bought cash-and-stock by its larger rival. The bidding war began on March 18, when Anbang jumped in with a surprise $13.2 billion, which Marriott matched with $13.6 billion on March 21. And, on March 29, came Anbang's latest counteroffer at $14 billion. This takeover battle between Anbang, a 12-year-old Chinese insurance company, and Marriott, an 89-year-old blue-chip household name, is one worth watching. Anbang's aggressive ambitions are the very manifestation of Chinese investors' appetite for diverse overseas assets, and the Beijing-based insurer seems unlikely to back down. At the same time, the time and energy Marriott has invested is not something it is going to happily walk away from, analysts say, while others think it may perhaps have been stretched too thin by Anbang's latest counteroffer—that it may have limited scope to increase its bid without turning a potential win into a Pyrrhic victory.
Update: (3/31): Anbang drops bid, clears path for Marriott
More from CLP:
This premium content is reserved for
China Law & Practice Subscribers.
A Premium Subscription Provides:
- A database of over 3,000 essential documents including key PRC legislation translated into English
- A choice of newsletters to alert you to changes affecting your business including sector specific updates
- Premium access to the mobile optimized site for timely analysis that guides you through China's ever-changing business environment
Already a subscriber? Log In Now