CHINA Law and Practice Contributed by: Liu Cheng and Li Yumeng (Audrey), King & Wood Mallesons
• marketing channels. Relevant Geographic Market
petition concerns. With respect to the circum - stances where the simplified filing procedure will be eligible, please refer to 3.8 Review Process . 4.3 Reliance on Case Law While relevant precedent/case law is not bind - ing, in practice, SAMR may refer to its previous decisions (including the precedent of its prede - cessor, MOFCOM) to consider how the relevant markets should be defined. Occasionally, SAMR may refer to case law from other jurisdictions, particularly if a transaction relates to markets that SAMR has not previ - ously examined in detail. The decisions of the European Commission are the most important in this respect. However, such decisions in other jurisdictions are for reference only, and SAMR As mentioned above, under the AML, a concen - tration may be challenged on the grounds that it has or is likely to have the effect of eliminating or restricting competition. In practice, during the merger control review, SAMR may investigate competition concerns that include the following: Horizontal Concerns For concentrations between undertakings active in the same markets, SAMR typically will con - sider the following competition concerns: • unilateral effects, ie, whether the concentra - tion would generate or reinforce a single undertaking’s capability, incentive and possi - bility to eliminate or restrict competition; and • co-ordinated effects, ie, if the relevant mar - carries out its own assessment. 4.4 Competition Concerns ket is characterised as oligopolistic (there are only limited competitors in the relevant market), SAMR may focus on whether the concentration would generate or reinforce
For the relevant geographic market definition, demand substitution analysis should consider factors such as: • evidence indicating that consumers are shifting or intend to shift to purchasing other commodities due to changes in price or other competing factors; • the transport costs and features of transport; • actual regions of most customers’ choice of goods; • the restrictions set out by the relevant laws and regulations; and • other factors such as language preferences and consumption habits of users. Supply substitution analysis should consider factors such as: • evidence indicating the response of other undertakings in other territories in respect of the changes of competing factors such as price; and • the timeliness and feasibility of the supply/ sales of the relevant product by other under - takings in other territories. There is no de minimis clause based on the par - ties’ total sales or market size in China. How - ever, for a horizontal concentration in which the aggregated market share of the parties is less than 15%, SAMR will normally presume the transaction does not have anti-competitive effects, unless there is evidence indicating oth - erwise. Besides, if a transaction is eligible for a simpli - fied filing procedure, it generally means that the transaction is not likely to cause significant com -
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