China Antitrust Law Journal, Volume 2
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The Fall 2018 issue of the China Antitrust Law Journal presents a range of articles that lucidly explain Chinese competition law and practice and put critical questions into larger world focus. In its relatively short space, the issue touches upon most of the cutting-edge competition issues of the day. This volume is particularly welcome at this time when Chinese competition law has become so prominent in the world and China is becoming a leader, or at least prominent in following its own drummer while taking competition enforcement actions that are felt beyond its borders. The world wants to know what the Chinese Anti-Monopoly Law ("AML") means, what to do to comply, and on a higher level, what is there that the world might learn from China’s initiatives? Articles in this volume address these questions.
Submission of Articles:
The CHALJ welcomes the submission of original articles not previously published elsewhere. Exceptional antitrust experts from all over the world sit on our Editorial and Advisory Boards. We will be very interested in receiving scholarly manuscripts that may have an impact on law, economics and enforcement policy, particularly when challenging antitrust shibboleths or confronting novel issues relating to the new economy. This being said, we also wish to publish articles that explain Chinese antitrust developments, decisions and policy to a Western audience, particularly when greater clarity and analysis is obviously needed.
Articles will be reviewed by the Editorial Board and will be subject to a double-blind peer-review process involving scholars and practitioners. Article submissions and requests for guidelines relating to submissions should be sent to Frank Fine, Editor-in-Chief, at email@example.com. Any questions about work written originally in Chinese should be directed to Michael Gu, Co-Managing Editor, at firstname.lastname@example.org.
Table of Contents
Eleanor M. Fox
Antitrust Immunity For Airline Alliances: Legal and Institutional Frameworks in China
Jae Woon Lee and Xiongfeng Li
In a competitive market, an airline alliance is a flexible organizational form offering growth potential and a commonly used business practice in the industry. Although low-level airline alliances generally do not create competition law concerns, high-level airline alliances may have the object or effect of restricting competition. This makes necessary an analysis of competition law. The view in many jurisdictions is that if the efficiencies that an airline alliance enhances and the benefits it provides consumers outweigh its anticompetitive effects, the government can grant it an exception, which is known as antitrust immunity. In contrast, China’s ten-year old Antimonopoly Law does not set clear rules about antitrust immunity for airline alliances, and Chinese antitrust regulators have yet to formalize the process of granting antitrust immunity to airline alliances. However, there are telltale signs of reform.
Standards and Patent Assertion Entities at the IP-Antitrust Interface: Adhering to Basic Principles
Yee Wah Chin
The United States antitrust approach to intellectual property has evolved over time. The same antitrust analysis now applies to conduct involving IP as to conduct involving other forms of property, taking into account the speciﬁc characteristics of the particular property right.
However, there have been significant calls recently for presumptions that infringements suits and licensing conduct by patent assertion entities (“PAEs”) labeled “patent trolls” and holders of standard essential patents (“SEPs”) are monopolization or attempts to monopolize that violate Sherman Act § 2, 15 U.S.C. § 2. This paper argues that the basic principles of keeping in mind history and context, and general antitrust principles, apply equally to SEPs and PAEs as to other economic phenomena, and there is no need for any special presumptions.
Should Competition Agencies Tackle Cross-Border Algorithmic Collusion: A Focus on Young Competition Agencies
Pierre Horna and Leonila Papa
Young competition agencies have long struggled with brick-and-mortar cross-border cartels. Now, their problems are compounded by algorithmic collusions. Using the principles discussed by Ezrachi and Stucke in ‘Virtual Competition’ as the backdrop, this paper explores the rise of the ‘algorithm economy’ in the developing world and the competition issues it has brought on and provides some reflections about how young competition agencies can address these problems.
China’s Anti-Monopoly Law in Light of European Union Competition Law: a Comparative Perspective
The article aims to identify traces of European Union (“EU”) competition law in China’s Anti-Monopoly Law (“AML”). The analysis addresses general issues pertinent to competition law in China and proceeds to analyze EU law elements in each of the competition law pillars. The greatest influence of EU law is identified in addressing the abuse of dominance. The Chinese regulations, with minor exceptions, have fully incorporated the EU pattern. … The article concludes that the AML has been formed under the strong influence of EU competition law because the normative grounds, to a large extent, overlap. Nevertheless, because of differences in economic, political and social environments, the Chinese application should be expected to depart from the EU model, and similar normative legal concepts to be modified through interpretation. Identifying the areas of convergence as well as divergence, based on a black letter law analysis of the AML, is important for the evaluation of the AML in a global perspective. In addition, the analysis may contribute to gaining deeper understanding of the directions of the future development of the anti-monopoly law in China.
China’s Fair Competition Review System—A Winding Road Ahead
The purpose of this article is to reflect on local government interventions with negative effects on competition. We will review the origins of China’s recent attempt to rein in regional protectionism through its new Fair Competition Review System (“FCRS”), recalling the historical milestones and current state of the jurisprudence in the United States (“US”) and the European Union (“EU”) addressing the same issue. This article will conclude that while one has to be careful with drawing parallels, overseas experiences suggest that China’s leadership may well wish to consider improving the implementation mechanism of the FCRS by providing its central authorities with enforcement tools and opening up access to the domestic courts to address controversial issues as a last resort.
Antitrust Treatment of Standard Essential Patent Abuse: China’s Experience and Lessons
The issue of how to constrain the anti-competitive effects of abuses of standard essential patents (“SEPs”) has been a hot issue in antitrust enforcement around the world in recent years. China, with its Anti-Monopoly Law (“AML”), since 2008 has investigated a number of cases in this regard, including the milestone Qualcomm case concluded by the Chinese antitrust authority in 2015. During the past five years, both public enforcement initiated by antitrust authorities and private actions brought by companies in the field of SEP abuse have been active in China. This article, based on the review of laws and practices relating to the antitrust regulation of SEP abuse, argues that Chinese antitrust authorities have exerted great effort to use the AML as an effective weapon to balance SEP power and to safeguard consumer rights in the telecommunication sector. In conclusion, this article suggests that China is and will be the only major jurisdiction to actively regulate SEP abuse in public enforcement.
Antitrust Dawn Raids in China: On the Tenth Anniversary of Chinese Antitrust Enforcement
Todd Liao and Bonnie Li
This article will provide an overview of China antitrust enforcement and dawn raids over the past ten years and will discuss the main characteristics of China’s antitrust dawn raids, including the origins, processes followed, authority, raid strategies, and possible penalties. The article identifies “best practices” for dealing with dawn raids and provides guidance for obtaining leniency. We expect that these best practices and guidance will be directly relevant to investigations by the State Administration for Market Regulation (“SAMR”), the establishment of which is discussed at the end of this article.
The Role of Judges in the Development of Competition Law
Key Challenges for Competition in Telecommunications—Insights from the Hong Kong Competition Commission