All enterprises will be treated equally under China's Anti-Monopoly Law, effective August 1. Chinese enterprises should improve their understanding about the law while foreign companies are preparing for the changes that may be brought about by the law.
Prof. Shi Jianzhong from China University of Political Science and Law, stressed that the law formulated after China's WTO accession and the implementation of the law would comply with the basic WTO principles of national, non-discriminatory treatment.
"The Chinese market is so highly international now that it is neither realistic nor possible to only target the law at foreign multinationals while relaxing it for domestic companies," Shi argued.
Prof. Huang Yong from the University of International Business and Economics also stressed that like any law regulating competition in a market economy, China's AML applies to all enterprises --- no matter what ownership or scale they possess.
Responses have varied among enterprises so far and that has aroused concern. When foreign companies close much attention to the law, their Chinese competitors do not seem to mind.
Although there is an article recognizing the special position of state-owned enterprises (SOEs) in some sectors, the law does not offer any exemptions to any kind of enterprises or industries. "The same article also states very clearly that those SOEs are not allowed to damage consumers' interest by abusing their dominant market position," Huang warned.
Prof. Shi believes that small and medium-sized enterprises will gain more opportunities in a better competition environment as the result of the law; and the article exempts SMEs --- both Chinese and foreign --- from legal consequences of monopolistic agreements as long as they can prove the effect of such agreements on improving their competitiveness and efficiency.
However, that does not mean SMEs will not be challenged by the law. Monopolistic conducts on price-fixing and restrictions of quantity or market by SMEs will also be punished by the law.
The two experts agreed that the reason for the different responses was a weak awareness and lack of understanding of the competition law. "This law is still something new for Chinese businesses while foreign multinationals have lived with their competition laws for so many years," they said.
They called on Chinese enterprises to pay more attention to the law, warning that the lack of interest in the law among Chinese companies could be very "worrisome" when the law has been put into effect and would begin to influence the market.
By People's Daily Online
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