New Anti-unfair Competition Law tackles dominance abuse, enterprise bribery

November 10, 2017 | BY

Katherine Jo

DLA Piper

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Nathan Bush & Ning Qiao

On November 4, 2017, China's National People's Congress amended the PRC Anti-Unfair Competition Law (AUCL) for the first time since its enactment in 1993. The revisions have overhauled many sections of the AUCL, including its rules against anti-competitive conduct.

Eliminating overlaps

The AUCL was among the first major laws of China's economic reform era. The original text read like an omnibus regulation of commercial conduct for nascent markets, with rudimentary rules on deceptive advertising, trademark infringement, commercial bribery bid-rigging, and antitrust. It laid the foundation for more elaborate administrative regulations, and many provisions are actively enforced by the State Administration of Industry and Commerce (SAIC) and other authorities. However, subsequent laws dedicated to consumer protection, intellectual property, and other fields obviated many of the AUCL's general provisions. The amendments trimmed away many obsolete articles, including antitrust provisions eclipsed by the PRC Anti-monopoly Law (AML).

Following EU practice, the AML prohibits unreasonable tying and predatory pricing by firms with market power as “abuse of dominance.” The AUCL's