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君合参与撰写Lex Mundi全球竞争法报告

2020.04.27

近日,君合作为国际知名独立律师协作组织Lex Mundi唯一代表中国的成员,参与撰写了Lex Mundi全球竞争法报告(Global Competition Law Report),以下为君合撰写的关于Digitization and Competition Law CHINA的内容。


CHINA


I. “Either-Or” Restrictions under Chinese Competition Law


Over the last several years, private plaintiffs have filed suits challenging the restrictions that e-commerce platforms place on e-retailers that prevent them from selling on multiple sites. These “either-or” restrictions, or exclusive dealing, even triggered concerns from regulators, and on November 5, 2019, one week before the annual “Single’s Day” (akin to online Black Friday in China), the State Administration for Market Regulation ("SAMR”)held a meeting with the top e-commerce players in China, including Alibaba and JD.com. During the meeting, SAMR officials emphasized that “either-or” restrictions are expressly prohibited by China's E-commerce Law, further, such behavior may also violate Anti-monopoly Law ("AML”) and Anti-Unfair Competition Law ("AUCL”).1 

Although certain rules under each of the E-commerce Law, AML, and AUCL could be used to regulate “either-or” restrictions, they have different implications and penalty mechanisms.


Although certain rules under each of the E-commerce Law, AML, and AUCL could be used to regulate “either-or” restrictions, they have different implications and penalty mechanisms.


A. E-Commerce Law


Article 35 of the E-Commerce Law stipulates that, "e-commerce platform operators shall not make use of their service agreement, transaction rules and technology etc. to impose unreasonable restrictions or unreasonable conditions on the transactions of operators on platform or the price of such transactions, or collect unreasonable fees against operators on platform." Further, according to Article 82, violators of Article 35 shall be ordered to make restitution within a stipulated period. These violators may be subject to a fine ranging from RMB50,000 to RMB500,000, and in serious cases, a fine ranging from RMB500,000 to RMB2 million shall be imposed. It seems that “either-or” restrictions would be deemed infringements under the E-Commerce Law even if the platform did not enjoy market dominance. If the revenue size of the undertaking concerned is significant, the penalties available under the E-Commerce Law, which do not depend on an undertaking's turnover, are relatively moderate compared to the AML.


B. Anti-Monopoly Law


Exclusive dealing with no justification is explicitly prohibited by the AML as an abuse of dominance. Furthermore, the Interim Regulation Prohibiting Conduct Abusing Dominant Market Positions ("SAMR Abuse Regulation”)specifically points out that, for internet and similar businesses, the industry specificity, business models, user numbers, network effects, foreclosure effects, technological characteristics, market innovation, and data control and processing are factors that can be taken into account in the course of a dominance assessment. It seems that the “either-or” restriction would be deemed an infringement of the AML if the undertaking concerned has a dominant position based on the specific factors for e-commerce businesses. For an abuse of dominant position under the AML, a fine ranging from 1% to 10% of the turnover would be imposed.


C. Anti-Unfair Competition Law


Article 12 of the Revised AUCL also specifically addresses unfair competition activities conducted on the internet.


Prohibited conduct includes taking advantage of technical means to maliciously make a network product or service offered by another incompatible with one's own and forcing users not to use the network product or service offered by another. Violators of Article 12 face a fine from RMB100,000 to RMB500,000, and in serious cases, from RMB500,000 to RMB 3 million. Similar to the E-commerce Law, a dominant position is not required to find that Article 12 has been infringed. Fines may be moderate compared to the AML if the revenue size of the undertaking concerned is significant.


Although scholars may have concerns on the overlap or even potential conflict between these different sets of rules, the fact remains that regulators are equipped with various weapons to regulate the “either-or” issues for e-commerce. Accordingly, more attention to compliance with these laws should be paid by e-commerce players in China.


1.Available at http://www.cnr.cn/sd/ppsd/20191105/t20191105 524846264.shtml.

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