Article

New implementing regulations of China's Anti-Monopoly Law: highlights and implications

Published Date
Apr 20 2023
Following last year’s significant amendments to the PRC Anti-Monopoly Law (2022 AML) the State Administration for Market Regulation (SAMR) has published final versions of the accompanying implementing regulations.

Taking effect on 15 April 2023, these regulations clarify various aspects of the 2022 AML, setting out how key concepts in merger control, anti-competitive agreements and abuse of dominance should be interpreted.

Overall, the implementing regulations bring clarity in a number of areas, in particular in relation to actions that might amount to gun-jumping in merger control, SAMR’s ability to review below-threshold transactions, coordinator responsibility in horizontal agreements and the identification of abusive conduct. They also have a clear focus on the digital sector, giving more guidance on how to implement the 2022 AML in this area (and confirming that the digital economy remains on the radar for SAMR).

However, a number of questions remain unanswered. Combined with the fact that the implementing regulations in two important areas – merger filing thresholds and abuse of intellectual property rights to eliminate or restrict competition – are still in draft form, this leaves uncertainties for businesses and their advisers.

In this alert, we take you through the key elements of the final implementing regulations, highlighting what has changed from the draft versions and setting out the practical impact of the rules. 

 

Key points

Merger control

  • Concept of “control” further refined, but not all proposed criteria adopted
  • Actions that can amount to “gun-jumping” explicitly listed
  • Calculation of turnover clarified
  • Conditions for new stop-the-clock mechanism set out
  • Procedure for review of below-threshold transactions further established, including ability of third parties to report deals

Anti-competitive agreements

  • Safe harbour rule retained, but market share threshold and scope remain unspecified
  • Provisions on coordinator responsibility in horizontal agreements refined
  • Scope of leniency regime (potentially) broadened to include vertical agreements

Abuse of dominance

  • “Consistency of business operators’ conduct” a primary factor for establishing collective dominance
  • More guidance on identifying abusive conduct
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Allen & Overy - New Implementing Regulations of Chinas Anti-Monopoly Law - Highlights and Implications

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