Chicago Journal of International Law


Though many jurisdictions have adopted competition laws in recent decades, none of these laws has engendered the level of interest sparked by China's proposed Anti-Monopoly Law ("AML"). Several factors have combined to inspire an unprecedented flow of commentary and consortia on each iteration of China's draft AML. These factors include the sheer scale and astounding growth of China's markets, the vast amounts of foreign capital recently invested in China, the burgeoning sales of Chinese goods abroad, the substantial growth in the participation of Chinese firms in foreign markets, and a recognition of the significant challenge posed by the establishment of free market competition in China's socialist market economy. To China's great credit, the State Council, the Ministry of Commerce ("MOFCOM"), the National Development and Reform Commission ("NDRC"), and the State Administration for Industry and Commerce ("SAIC") have solicited and studied numerous sets of comments from public and private organizations, companies, and academic experts around the world. The language of the draft AML pending before the National People's Congress ("NPC") has incorporated many of these useful comments. However, concerns about the current draft remain. Broadly speaking, China's economy presents three principal features raising competition concerns: so-called local blockage or regional monopolies; sectoral monopolies by Chinese firms, including state-owned enterprises ("SOEs'); and a perception of alleged abuses of dominant positions by some foreign multinationals. Earlier drafts of the proposed AML contained a chapter prohibiting so-called administrative monopolies, which are typically large "local champions" protected from competition by local and regional government bodies. The elimination of that chapter from the November 11, 2005 Draft AML ("Current Draft AML" or "November 2005 Draft AML") essentially exempts such anticompetitive conduct from the reach of the Anti-Monopoly Law. [CONT]