The Enforcement Mechanism of the Antitrust Law in China

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The Enforcement Mechanism of the Antitrust Law in
Chinas Mainland

• By Jiemin Sheng
• Professor of Law, Peking University Law School
• Director of Peking University Institute of
  Economic Law

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I. Importance of the Enforcement Authority in the
Whole Legislation of the Antitrust Law

• 1. The tasks of the Antitrust Law has determined
  that the enforcement authority has its
  peculiarities
• a. Antirust law investigations and rulings are
  based on the precondition of professional
  judgments.
• b. Antitrust enforcement authorities should be
  independent and authoritative.
• c. The antitrust authority should have the power
  to take certain coercive measures and impose
  punishments.

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• 2. The actualities of China requires the
  establishment of the enforcement authority to be
  capable of effectively solving the problem of
  administrative monopolization and the problems
  caused by enforcement by different government
  authorities
• 3. From the perspective of future development,
  scientific setup of the antitrust law enforcement
  authority concerns the optimization of the law
  enforcement mechanisms, perfecting the government
  ruled by law, and promoting exchange with other
  countries

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II. A Comment on the Articles Regarding the Setup
of the Enforcement Authority (Deliberation Draft)

• 1. A comment on the dual setup pattern

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• a. The Draft tries to establish an Antitrust
  Commission as a decision making body so as to
  form a dual structure of separating decision
  making from enforcement. Unfortunately, this is
  incompatible with the unique features of the
  Antitrust Law
• A commission made up of heads of different
  departments or institutions could hardly play its
  role as a supervisor and coordinator
• It is the trend of development of modern
  antitrust law for the enforcer to concurrently
  have decision making power, enforcement power,
  and judicial power so as to ensure the effective
  enforcement of the antitrust law

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• 2. The dual setup pattern fails to change the
  present structure of enforcement by different
  authorities, which will weaken the function of
  antitrust law enforcement
• Combating Administrative monopolization is an
  unavoidable task of the Antitrust Law. So it is
  necessary to sever the various connections
  between enterprises and the government through
  the setup of an independent and authoritative
  enforcement authority.
• Therefore, the antitrust law enforcement must be
  independent from the interest of the different
  government authorities. One of the aftermaths of
  the dual setup pattern is to maintain the
  existing law enforcement powers of the different
  departments, i.e., to maintain their own
  interests.

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2. Comment on the Provisions Regarding the
Conflicts between the Law Enforcement Authority
and Other Relevant Departments or Regulatory
Departments

• a. The powers of the antitrust law authority and
  the industrial regulatory departments are not
  clearly defined.
• b. There are similar provisions in the
  Anti-Unfair Competition Law of 1993, which
  dismember the law enforcement power of the
  Antitrust Law.

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• c. It is the worldwide trend to establish an
  independent but authoritative antitrust
  enforcement authority.
• d. China should give up the tradition of putting
  more emphasis on substantive law than on
  procedural law, and remedy the substantive
  defects with procedural provisions.
• Moreover, how to coordinate the relationship
  between the court and the Antitrust Commission
  should also be provided for in the Antitrust Law

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III. Suggestions for Perfecting the Antitrust Law

• 1. The Setup of the Authority Should Be Based on
  the Following Principles
• A. the principle of authoritativeness and
  independence
• B. the principle of lawful setup
• C. the principle of being streamlined and
  efficient

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2. Basic Functions and Powes

• The basic functions of the antitrust enforcement
  authority are to implement the substantive
  provisions of the Antitrust Law. Such functions
  include the power to
• A. investigate and inspect
• B. make examinations and grant approval
• C. make consultations and inquiries
• D. impose penalties
• E. make rulings
• F. make ministerial rules
• G. scrutinize official documents
• H. admonish and make conciliation agreements.

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• 3. Provisions regarding the relationship with
  other industrial regulatory authorities and
  market enforcement authorities
• The antitrust enforcement authority should play
  a leading role in the antitrust enforcement
  activities
• 4. Internal rules of procedure
• 5. Provisions on subjecting the enforcement
  authority to judicial review