Anti-monopoly law still facing difficulties

China's Anti-Monopoly Law is not a law against large enterprises, but only against the abuse of their market dominance, the country's anti-trust law enforcement officials said at a forum held in Beijing Wednesday.

"The Anti-Monopoly Law is not against those who have dominant market positions, but against those who impede competition and set discriminatory prices by taking advantage of their dominance," said Xu Kunlin, director general of the Bureau of Price Supervision and Anti-Monopoly under the National Development and Reform Commission (NDRC).

The remarks were made on the occasion of the fifth anniversary of China's anti-trust law.

However, China's anti-monopoly law still faces the problem of dealing with administrative monopoly, said Wang Xiaoye, a professor at the Institute of Law under the Chinese Academy of Social Sciences, at the forum.

Administrative monopoly refers to anti-competitive conduct by State-owned enterprises with dominant positions in industries such as finance, telecoms, and energy resources. It also includes discriminatory policies by regional administrators against non-local products and services.

There are still cases of local administrators abusing their power by blocking non-local products from entering the local market, said Xu of the NDRC.

Since China's anti-trust law became effective in 2008, government agencies including the Ministry of Commerce (MOFCOM), the NDRC and the State Administration for Industry and Commerce (SAIC) have investigated several ­anti-competitive cases, but few were related to large State-owned enterprises.

MOFCOM focuses on mergers and acquisitions. For instance, it barred Coca-Cola's planned acquisition of leading Chinese juice firm Huiyuan in 2009.

The SAIC deals with non-price collusion or abuse of dominant market positions, such as the recent case against Swedish food and beverage packaging producer Tetra Pack.

The NDRC deals with price fixing, such as the fines it levied against Chinese high-end liquor producers in February.

In 2011, the NDRC probed State-owned telecom service providers China Unicom and China Telecom for abuse of market power. The case ended with both China Unicom and China Telecom promising to lower Internet access fees for the public.

"The Anti-Monopoly Law is applicable to market players, but the government is not a market player, so the law cannot tackle the problem of administrative monopoly - but reform will do," said Shang Ming, director general of the Anti-Monopoly Bureau of MOFCOM.

The heritage of the former planned-economy system has become a heavy burden for China's transition to a market economy, said Wu Jinglian, a prominent economist.

It is up to the central government to work out a detailed plan and schedule of reform to build a unified, open, competitive and orderly market system, Wu noted.

NDRC, SAIC see progress in infant formula, packaging probes

The National Development and Reform Commission (NDRC) has completed its investigation into producers of infant milk formula, and will soon announce the results of the probe, said Xu Kunlin, director general of the Bureau of Price Supervision and Anti-Monopoly under the NDRC, at the China Competition Policy Forum held in Beijing Wednesday.

The agency said in early July that it was investigating some domestic and foreign infant formula firms including Nestle, Danone, Mead Johnson Nutrition and Abbott Laboratories, for possible price-fixing and anti-competitive practices.

The State Administration for Industry and Commerce (SAIC) said Wednesday that its investigation of Swedish packaging giant Tetra Pak is still ongoing, and that it has found key information in the company's deleted e-mails.