Anti-monopoly law took effect
The first anti-monopoly law in China, which was not approved until last year, finally took effect on Aug 1st this year.
Investors and legal experts believe that the law is a landmark law in China’s transition to market economy and further opening up which is considered by some people as the “constitution for the market economy” because of its importance in promoting an environment of fair competition.
According to Li Shuguang, a professor at China University of Politics and Law, who participated in drafting the law, foreign investors will be better protected by the law.
“This is a defining moment in the development of China’s legal system,” said James Zimmerman, chairman of the American Chamber of Commerce in China. “The new anti-monopoly law establishes a basic framework to build a fair, uniform and national competition law system that benefits consumers by recognizing and preserving incentives to compete,” said Zimmerman.
Li said that, with the law, multinationals would clearly know which department to apply to rather than hesitate over which ministry to approach when doing investment. “After the law takes effect, the decision-making time will be considerably shortened and investment risks will be reduced,” said Li before.
Although the law was a good sign, experts once thought the real problem was how to enforce it efficiently after it took effect.
Another expert, Shi Jianzhong, who also participated in drafting the law, held the opinion that the law is probably the shortest one in the world since it only owns certain principles. But he also said that we should not consider it as a compromise, because with blank in anti-monopoly cases, it would be difficult to evaluate its influence on the market if we required a lot at the very beginning.
According to sources, three government bodies — the Ministry of Commerce, the National Development and Reform Commission and the State Administration for Industry and Commerce — will enforce the law.
Despite the unclear enforcement part of the law and unprofessional law enforcement body, we are still observing with interest how the law is going and expecting good outcome.
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