The current Anti-Monopoly Law was revised for the first time. The new law, hereinafter referred to as the Anti-monopoly Law (2022), was officially implemented on August 1 2022. The Anti-monopoly Law (2022) puts forward new requirements for operators' behavior from three aspects: monopoly agreement, abuse of dominant market position and concentration of operators. Under the market environment of brand-new competition rules, comprehensively lead enterprises to examine and grasp the general trend and coping strategies of anti-monopoly compliance work under the new situation.
1 Restrict the application of related systems in platform economy
The new law stipulates that:
Article 9 Business operators shall not engage in monopolistic behaviors prohibited by this Law by using data, algorithms, technologies, capital advantages and platform rules. (New clause)
Paragraph 2 of Article 22: Operators with dominant market position shall not engage in the abuse of dominant market position as stipulated in the preceding paragraph by using data, algorithms, technologies and platform rules. (New clause)
Interpretation of key terms:
In recent years, anti-monopoly in the field of platform economy has always been the focus of supervision departments and society. Some large-scale platform operators abuse the advantages of data, technology and capital to monopolize, which constantly hinders fair competition, disrupts market order and harms consumers' rights and interests. From April of 20021year, the State Administration of Markets announced the results of Alibaba's anti-monopoly investigation and fined it 654.38+0.82 billion yuan, setting a record for China's anti-monopoly administrative punishment. Subsequently, from April, 20021year to June, 2002 10, the State Administration of Market Supervision implemented "one of two choices" for the service market of Meituan's online catering take-out platform. On the level of administrative legislation, in February, 20021,the State Council Anti-monopoly Committee issued the Anti-monopoly Guide of the State Council Anti-monopoly Committee on Platform Economy. On 20021,10, the State Administration of Markets issued the Guidelines on Classification and Grading of Internet Platforms (draft for comments), which made solid steps in scientifically defining platform categories, rationally classifying platform grades, and promoting platform enterprises to implement the main responsibilities. The Anti-Monopoly Law (2022) has also made a positive legal response to this issue, clearly stipulating that operators are not allowed to engage in monopolistic behaviors prohibited by law by using data, algorithms, technologies, capital advantages and platform rules.
Compliance recommendations:
With the entry into force of the Anti-Monopoly Law (2022), Internet platform enterprises should pay attention to:
Make rational use of data, algorithms, technologies, capital advantages and platform rules to conduct a comprehensive compliance review and avoid abusing the above rules to reach a monopoly agreement.
No unified pricing and price adjustment methods or platform rules are issued to the operators in the platform, and the operators in the platform set their own prices.
Operators in the platform shall not be organized to exchange competitive sensitive information, or become the exchange medium of such information, and the relevant information obtained shall not be provided to other operators.
2 vertical monopoly agreement: the introduction of safe harbor system
The new law stipulates that:
In the second paragraph of Article 18, if the business operator can prove that it does not have the effect of excluding or restricting competition, it shall not be prohibited. (New clause)
Article 18 A business operator in the third paragraph can prove that its market share in the relevant market is lower than the standard set by the anti-monopoly law enforcement agency in the State Council and meets other conditions set by the anti-monopoly law enforcement agency in the State Council, so it is not prohibited. (New clause)
Interpretation of key terms:
According to the Anti-Monopoly Law (2022), both horizontal agreements and vertical agreements constitute monopoly agreements with the effect of excluding and restricting competition. However, for vertical agreements, the law gives operators more defense space, that is, if operators can prove that their actions do not have the effect of excluding or restricting competition, then their actions will not be restricted, but how operators prove it needs to be further defined in subsequent legislation and practice. In addition, the Anti-monopoly Law (2022) has added an internationally accepted "safe haven" system from the legislative level, stipulating that operators can prove that they meet the market share standards and other conditions stipulated by the anti-monopoly law enforcement agencies in the State Council, which will not be prohibited by law. However, the scope and conditions of application of "safe harbor" still need to be further clarified.
Compliance recommendations:
Although the "safe harbor" system gives enterprises more defense space, we should pay attention to:
The Anti-monopoly Law (2022) puts the "safe harbor" system under vertical monopoly, so the horizontal monopoly agreement reached between enterprises and other competitors is not applicable to the "safe harbor" rule.
Maintaining the resale price is generally considered to have the effect of excluding and restricting competition. Although enterprises can apply the "safe harbor" system to defend themselves, it is difficult, and enterprises should conduct anti-monopoly compliance review before reaching an agreement.
Pay close attention to the details of the applicable conditions of the future "safe haven" system, especially "other conditions stipulated by the anti-monopoly law enforcement agencies in the State Council", so as to better evaluate the anti-monopoly risks.
3 horizontal monopoly agreement: increase the legal responsibility of organizers and helpers.
The new law stipulates that:
Article 19 An operator shall not organize other operators to reach a monopoly agreement or provide substantial assistance for other operators to reach a monopoly agreement. (New clause)
Interpretation of key terms:
The original Anti-Monopoly Law only stipulated that trade associations should not organize operators in their own industries to engage in monopolistic behaviors prohibited by law (such as fixing prices, limiting production and other horizontal agreements), but did not explicitly stipulate that other main organizations other than trade associations should help other operators reach monopoly agreements. The Anti-Monopoly Law (2022) fills the previous legal gap, clearly stipulates that operators shall not organize other operators to reach monopoly agreements or provide substantial help for other operators to reach monopoly agreements, and establishes corresponding legal responsibilities. Article 17 of the Provisions on Prohibition of Monopoly Agreement (Draft for Comment) stipulates the specific situations of "organization" and "substantial assistance". "Organization" refers to the following situations: (1) Although the operator is not a party to the monopoly agreement, it plays a decisive or leading role in the process of reaching or implementing the monopoly agreement; (two) an operator signed an agreement with a number of counterparties, deliberately making the counterparties with competitive relations communicate with each other or exchange information through the operator to reach a monopoly agreement. "Substantial help" refers to the behavior that the operator provides support for the conclusion or implementation of the monopoly agreement, although he has not engaged in the above-mentioned organizational behavior, and has a causal relationship with the elimination and restriction of competition and has significant effects.
Compliance recommendations:
When communicating and trading with other operators, enterprises should pay attention to:
When communicating with other operators, pay attention to prevent the discussion of competitive sensitive information such as sales price, sales volume and customer information, and prevent other operators from abusing the obtained information to reach a monopoly agreement.
No unified price calculation and price adjustment management policies shall be issued to other operators, and attention shall be paid to the risks of maintaining resale prices.
Shall not organize and assist other operators to reach an agreement to divide the market, so as not to be considered as providing substantial help.
4 centralized investigation procedures for operators who fail to meet the reporting standards
The new law stipulates that:
Article 26 Where the concentration of business operators meets the declaration standards stipulated by the State Council, the business operators shall report to the anti-monopoly law enforcement agency of the State Council in advance. If the concentration is not declared, the concentration shall not be implemented.
If the concentration of business operators does not meet the reporting standards stipulated by the State Council, but there is evidence that the concentration of business operators has or may have the effect of eliminating or restricting competition, the anti-monopoly law enforcement agency of the State Council may require business operators to declare. (New clause)
If the operator fails to declare in accordance with the provisions of the preceding two paragraphs, the anti-monopoly law enforcement agency of the State Council shall conduct an investigation according to law. (New clause)
Interpretation of key terms:
The Anti-Monopoly Law (2022) clarifies the procedure of centralized investigation by law enforcement agencies for operators who "fail to meet the reporting standards" at the legal level for the first time. This clause mainly regulates "killer acquisition", which is common in pharmaceutical companies and internet companies, that is, existing companies acquire and integrate their related technologies by acquiring start-ups to enhance their market position. How to judge whether the concentration of operators who fail to meet the reporting standards may have the effect of excluding and restricting competition remains to be further clarified in regulations and practice in the future.
Compliance recommendations:
The Anti-Monopoly Law (2022) refines the rules of centralized declaration procedures for business operators and increases the punishment for failing to declare transactions according to law. Enterprises should carefully evaluate the investment transactions in M&A;
Evaluate as soon as possible whether the transaction has the effect of eliminating or restricting competition, whether it meets the reporting standards and whether it needs to be reported.
For minority equity investment, it is necessary to further evaluate whether to obtain control and whether to declare.
If there is evidence that transactions may have the effect of eliminating or restricting market competition, transactions that do not meet the reporting standards may also need to be reported.
Transactions that require centralized declaration by business operators according to law shall not be traded without approval.
5. Introduce the bell-stopping system to optimize the centralized review procedure for operators.
The new law stipulates that:
Article 32 Under any of the following circumstances, the anti-monopoly law enforcement agency of the State Council may decide to suspend the review period of centralized calculation of operators and notify the operators in writing:
(a) the business operator fails to submit documents and materials as required, which makes the review work impossible.
(two) the emergence of new situations and new facts that have a significant impact on the centralized review of operators, which will lead to the failure of the review without verification.
(three) the operator needs to further evaluate the restrictive conditions attached to the concentration, and the operator requests to stop.
Since the termination of the review period and the elimination of the calculation situation, the review period will continue to be calculated, and the anti-monopoly law enforcement agency of the State Council shall notify the operator in writing. (New clause)
Interpretation of key terms:
The Anti-Monopoly Law stipulates that the centralized review of business operators is divided into preliminary review and further review, and the review period can be extended under special circumstances. The longest time limit of the whole audit procedure is 180 days. The original intention of this provision is to prevent the review institution from unreasonably extending the review period, but it has encountered many obstacles in actual operation. First of all, it is difficult to complete a complete and in-depth review in 180 days for some cases with a large number of operators. Secondly, the contradiction between more reported cases and fewer examiners also aggravated the difficulty of completing the examination within the specified time. This has also led to the practice that the censor ordered the operator to withdraw the centralized declaration and then re-declare in order to extend the review period.
The Anti-Monopoly Law (2022) introduced the ringing system in the centralized review procedure of operators, which optimized the time limit of the review procedure and provided greater flexibility for the review. Article 32 stipulates that the anti-monopoly law enforcement agencies in the State Council may decide to suspend the review period under three statutory circumstances. These three legal situations specifically refer to: First, the operator failed to submit documents and materials in accordance with the regulations, which led to the failure of the review. In this case, due to the operator's own behavior, it is impossible to advance the review in time, and it is reasonable to suspend the review period. It is necessary to wait for the operator to supplement the documents before continuing the review. Second, there are new situations and new facts that have a significant impact on the centralized review of operators. Without verification, the review will not be carried out. This situation is not caused by the operator's own reasons, so the extension of the review period should be reasonable, that is, the emergence of new situations and new facts should reach the level that affects the continuation of the review work. Third, it refers to the need to further evaluate the restrictive conditions attached to the concentration of operators, and the operators put forward the request for suspension. Once the operator accepts the restrictive conditions, it will inevitably have a great impact on his operation, so the new law gives the operator the right to request suspension in this case.
Compliance recommendations:
The introduction of the clock stop system will, to a certain extent, lead to the extension of the centralized review time of operators. In order to minimize the time cost caused by suspending the review, enterprises should pay attention to:
According to the requirements of the accreditation body, submit the required documents and materials as completely as possible to ensure the authenticity and accuracy of the documents.
Actively cooperate with the censor to follow up and supplement the missing documents in time.
When it is necessary to attach restrictive conditions to the concentration of operators, enterprises can take the initiative to extend the preparation time by applying for suspension of examination.
6. Improve the centralized review of operators and establish a new classification review system.
The new law stipulates that:
Article 37 The anti-monopoly law enforcement agencies in the State Council shall improve the centralized classification and grading examination system for operators, strengthen the centralized examination of operators in important areas such as the national economy and people's livelihood according to law, and improve the quality and efficiency of examination. (New clause)
Interpretation of key terms:
Regarding the concentration of operators, the Opinions of the Central the State Council on Accelerating the Construction of a National Unified Market (hereinafter referred to as the Opinions on Accelerating the Construction of a National Unified Market) proposed to improve the anti-monopoly review system for centralized classification of operators, which was implemented in the Anti-monopoly Law (2022). Article 37 of the new law, as a new provision, explicitly requires that "the anti-monopoly law enforcement agencies in the State Council should improve the centralized classification and grading examination system for business operators", and focus the examination scope on "important areas involving the national economy and people's livelihood", highlighting the principle of paying equal attention to quality and efficiency.
Specifically, the Anti-Monopoly Law (2022) does not define "important areas involving the national economy and people's livelihood", so there is still some uncertainty in the scope of the current key review. According to the Opinions on Accelerating the Construction of a National Unified Market, important areas may cover finance, media, science and technology, people's livelihood, and operators involved in start-ups, new formats and labor-intensive industries, and the specific scope may still develop dynamically with economic development.
Compliance recommendations:
The Anti-Monopoly Law (2022) establishes a hierarchical classification system in which operators are concentrated, and focuses on important areas such as the national economy and people's livelihood during the review. Enterprises should pay attention to:
Pay attention to the institutional trends of grading and classification review, and timely evaluate the monopoly risks of the industries involved in the current and future exchanges.
Enterprises involved in important fields such as the national economy and people's livelihood should pay more attention to the centralized declaration of operators and take corresponding measures as soon as possible.
Give procuratorial organs the right to file public interest litigation and safeguard public interests.
The new law stipulates that:
Article 60 A business operator who commits monopolistic acts and causes losses to others shall bear civil liability according to law.
Where a business operator commits monopolistic behavior and harms the public interests, the people's procuratorate at or above the municipal level with districts may bring a civil public interest lawsuit to the people's court according to law. (New clause)
Interpretation of key terms:
This revision increases the anti-monopoly civil public interest litigation system and gives the people's procuratorates at or above the municipal level with the function of civil public interest litigation. According to the original Anti-Monopoly Law, consumers and other operators who have been infringed by the monopolistic behavior of operators have the right to file a lawsuit to safeguard their rights. However, due to the concealment, complexity and diversity of monopolistic behavior, it is difficult to successfully obtain judicial relief through their own efforts. The introduction of public interest litigation by procuratorial organs not only enhances the confidence of victims in safeguarding their rights, but also helps to provide better results for plaintiffs who have suffered damage.
8. Improve the monopoly legal liability and increase the illegal cost.
Explain the provisions and key provisions of the new law;
"Legal liability" is the most changed chapter in this revision. Seven of the original nine legal provisions have been revised, and on this basis, articles 63, 64 and 67 have been added. The new law expands the subject of monopoly responsibility to individuals and increases the amount of fines. In addition, the new law introduces aggravated compensation system and credit record system, and clarifies criminal responsibility. On the whole, the new law not only expands the subject of responsibility for monopolistic behavior, but also increases the punishment for monopolistic behavior, which reflects hell to pay's legislative attitude. The following is a comparison before and after the revision of the legal liability for monopolistic behavior: (see the table below)
Compliance recommendations:
The Anti-monopoly Law (2022) has greatly increased the punishment for monopolistic behavior, so enterprises should pay more attention to anti-monopoly compliance. In addition, the new law also increases the individual responsibility for monopolistic behavior. It is suggested that enterprises in key anti-monopoly industries should take precautions and carry out anti-monopoly work under the new law as soon as possible:
Establish and improve the anti-monopoly compliance system, and timely evaluate the legality of business.
Strengthen the anti-monopoly compliance training of employees and enhance their anti-monopoly compliance awareness.
Employees should be cautious about the work of the enterprise in the process of handling work, consider the possibility of monopolistic behavior in all aspects in the decision-making process, and make a complete record of the decision-making and implementation process for future use.