The China Briefing BookstoreAug. 6 – The State Council has released the first set of specific guidelines for the new Anti-Monopoly Law which took effect August 1.
The regulation requires mergers and acquisitions with a total global revenue of more than RMB10 billion or a China revenue of RMB2 billion to report to authorities.
The law also covers deals made by two or more companies each reporting more than RMB400 million of China revenue in the past year.
An official from the Legislative Affairs Office of the State Council told Xinhua that the new rules will be used in the meantime and adjustments will be along the way should it prove hard to enforce.
He added that there could be special cases wherein although a company may not qualify under the new regulations, it could still limit competition if its market share was large.
China’s landmark anti-monopoly law aims to shield market competition from price-fixing and other forms of collusion. It bans behavior such as reaching monopolizing agreements, abusing a dominant market position and concentration of business operations that which may exclude or restrict competition.
August 6th, 2008 at 3:34 pm
The important thing in China about such laws, even though there has been much commentary elsewhere on the lack of implementing rules, is that they are on the statute. The Chinese are pragmatic enough to get them through through the State Council first, and see how the initial behavior and Chinese commercial reaction to the legislation is. Implementing rules are almost always issued later as a result of discerning which areas need tightening up - exactly the point Xinhua have made. The first step, and the most difficult, is always to get it into law. Modification once it is there is a far simpler issue to manage.