The Supreme People's Court of the Chinese mainland has introduced a comprehensive set of new judicial interpretations aimed at dismantling algorithm-driven monopolies, set to take effect on July 1. This move underscores the Chinese mainland's commitment to fostering fair market practices and encouraging economic development in the rapidly evolving digital landscape.
The 51-article document addresses a broad spectrum of antitrust issues, including procedural guidelines, market definition, monopoly agreements, abuse of market dominance, and civil liabilities in antitrust cases. These guidelines are designed to navigate the complexities introduced by modern economic models and heightened international competition.
He Zhonglin, Deputy Head of the Intellectual Property Court at the Supreme People's Court of the Chinese mainland, highlighted the dual impact of information technology and the digital economy. While these sectors drive economic growth and enhance livelihoods, they also present new challenges for antitrust law enforcement and judicial processes.
Despite a decrease in price competition within the digital economy, competition has intensified in areas such as quality, diversity, and innovation. Consequently, the new interpretations implement adjustments and regulations to address these emerging issues.
For instance, Article 15 within Section 2 outlines methods for analyzing hypothetical monopolists, focusing on factors like quality decline and cost increases. Articles 16 and 17 offer guidance on defining relevant products and market geographies, taking into account the often bilateral or multilateral nature of platform competition.
Regarding monopoly agreements, Article 24 specifies regulations concerning horizontal monopolies through data, algorithms, technology, and platform rules, as well as vertical monopolies that utilize technical means to control or automate resale commodity pricing. Article 25 delineates judicial pathways for addressing monopolistic behaviors potentially triggered by cross-platform most-favored treatment clauses.
Articles 30 and 32 detail the assessment of market share and dominance for platform operators, applying principles and analytical approaches to address unfair pricing, below-cost sales, refusal to deal, exclusive dealing, tying, and discriminatory practices in the digital economy.
Additionally, Article 42 provides guidelines on the selective application of antitrust and e-commerce laws to the abuse of platform dominance.
The new interpretations also aim to streamline the evidentiary burden and proof requirements in antitrust civil litigation. Plaintiffs can now directly file lawsuits based on the Antitrust Law or follow an antitrust enforcement agency's decision, provided they meet legal conditions. However, cases seeking only a declaration of monopoly without civil liability are not permitted.
The interpretations encourage parties to seek expert advice on specialized issues and commission market research or economic analyses from professional institutions. To facilitate understanding and application of these new guidelines, the Supreme People's Court of the Chinese mainland has released five recent antitrust cases, covering disputes over monopoly agreements and abuse of market dominance, offering valuable insights into the implementation of the updated Antitrust Law.
Tao Kaiyuan, Vice-President of the Supreme People's Court of the Chinese mainland, emphasized that the judiciary will continue to strengthen antitrust enforcement to promote fair competition and innovation, contributing to the development of a unified national market and new quality productive forces. This new interpretation aligns with the second anniversary of the revised Antitrust Law, updating the previous version released in 2012.
From 2013 to 2023, Chinese mainland courts concluded 977 first-instance antitrust civil cases. Since its establishment in January 2019, the Intellectual Property Court of the Supreme People's Court of the Chinese mainland has accepted 178 antitrust cases and concluded 131 by May 2024, some of which have had significant social impacts.
Reference(s):
Top court issues interpretation to tackle algorithm-driven monopolies
cgtn.com
