CHINA Law and Practice Contributed by: Qian Xiaoqiang, Yang Yikai and Chu Linxian, Haiwen & Partners
1. Cartels Law and Regulation 1.1 Legal Bases Article 17 of the Anti-monopoly Law (AML) (amended in 2022) stipulates that actual or potential competitors are prohibited from enter - ing into a wide range of agreements and/or con - certed practices that eliminate or restrict com - petition, and is the primary statutory basis for challenging cartel behaviours/effects in China. The AML also provides the exemption, liability, and enforcement procedure for cartels. The Pro - visions on Prohibition of Monopoly Agreements (the “Provisions on Monopoly Agreement” ) implemented in 2023 and the Interpretation of the Supreme People’s Court (SPC) on Several Issues concerning the Application of Law in the Trial of Monopoly related Civil Dispute Cases (the “2024 Judicial Interpretation” ) implemented in 2024 provide further details and elaborations. There are also certain forms of cartel behaviours elaborated in other laws and regulations, includ - ing the Provisions on Prohibition of the Abuse of Intellectual Property to Exclude or Restrict Com - petition implemented in 2023, the Bidding Law amended in 2017, and the Pricing Law imple - mented in 1998. In addition to the above, there are several anti- monopoly guidelines concerning diverse indus - tries and market entities (see 1.9 Guides Pub- lished by Governmental Authorities ). Though not serving as the statutory basis for challenging cartel behaviours, the guidelines are of essen - tial reference for competition authorities in their administrative enforcement and for undertakings in their compliance efforts.
1.2 Regulatory/Enforcement Agencies and Penalties The primary authority for competition enforce - ment in mainland China is the State Administra - tion for Market Regulation (SAMR), also known as the State Anti-Monopoly Bureau. Within the SAMR, the First Department of Anti-monopoly Enforcement specifically handles cartel conduct. In 2018, the SAMR empowered the Provincial Administration for Market Regulation (AMR) to take charge of competition enforcement at the provincial level. Therefore, “Competition Author- ities” in this article refer to the SAMR and AMR collectively. Since the amendment to the AML in 2022, the People’s Procuratorate at or above the level of a city with subordinate districts (not traditionally being regarded as the law enforcement author - ity for cartel conduct) may file civil public inter - est litigation with the People’s Court based on Article 60 of the AML, if the cartel activities of an undertaking harm social and public interests. The People’s Procuratorate, with extensive power to investigate, is expected to play a more important role in antitrust enforcement in the future. Liabilities and Penalties Under the AML and the relevant provisions, car - tel behaviours are subject to various liabilities and/or penalties, namely administrative liabilities (most common), potential civil liabilities, and
possible criminal liabilities. Administrative liabilities
For an undertaking that enters into and imple - ments a cartel agreement, Article 56 of the AML provides that competition authorities shall:
• order it to cease the illegal act; • confiscate its illegal gains; and • impose a fine of:
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