Strict law enforcement is the most important factor in breaking
monopolies, says a commentary in Southern Metropolis
Daily. An excerpt follows:
The draft anti-monopoly law was approved in principle at a
recent executive meeting of the State Council. After revision, the
draft law will be submitted to the Standing Committee of the
National People's Congress, the nation's top legislature, for
deliberation.
There are already laws and regulations that promote market
fairness such as the Anti-Unfair Competition Law and Law on the
Protection of Consumers' Rights and Interests. But these often go
unimplemented due to a lack of enforcement power.
The draft law deals with specific behavior that restricts market
competition. Strictly enforced, it can become a weapon to break
monopolies.
By excluding most of the clauses related to administrative
monopolies, the draft law has aroused much public concern.
Before we cast any further doubt, it should be made clear that
the core of an anti-monopoly law is to oppose behavior that limits
market competition and impairs the market. Anti-monopoly laws in
other countries mainly include the following aspects: rules about
agreements that restrict competition; rules on behavior that abuses
a dominant status in the market; rules about mergers of
enterprises; rules on unfair competition. As long as laws or
regulations deal with these matters, they can be regarded as
anti-monopoly laws.
It is said that China's legislators absorbed advanced foreign
experience when drafting the anti-monopoly law. Thus, the promotion
of fair play should become the core of the anti-monopoly law.
But some of the stipulations in the draft may go against this
spirit. For example, one article is about banning monopoly
agreements but there is no clear definition of a monopoly
agreement, which may exempt real monopoly agreements but raise the
threshold for co-operation among enterprises. And although there
are practical reasons for excluding the chapter about
administrative monopoly, such as to increase the competitiveness of
Chinese enterprises, especially resource enterprises, in the
international market, it ignores the harm done to the concept of
fair play in domestic market.
(China Daily June 12, 2006)