The Intellectual Property Court of Hainan Free Trade Port formed a five-member collegial panel to hear 12 anti-monopoly administrative punishment cases in public hearings

New Hainan Client, Nanhai Net, Nanguo Metropolis Daily December 16 news (reporter Chen Dong correspondent Luo Jingyi) On the afternoon of December 15, 2021, the Hainan Free Trade Port Intellectual Property Court formed a five-member collegial panel to hold a public hearing of the plaintiff Hainan Engineering Co., Ltd. and 12 other companies v. the defendant Hainan Provincial Market Supervision and Administration Bureau anti-monopoly administrative punishment case.

The scene of the trial. Photo by Guo Yuanyuan

The above 12 cases are the first batch of administrative litigation cases accepted by the Hainan Free Trade Port Intellectual Property Court since its establishment. Anti-monopoly administrative cases involve the norms of fair competition behavior of market entities, and also involve the administrative law enforcement organs' maintenance of the order of fair competition. The Hainan Free Trade Port Intellectual Property Court constitutes a five-member collegial panel with President Xia Junli as the presiding judge and Vice President Judge Su Zhihui and three other judges. Because the Hainan Provincial Market Supervision and Administration Bureau imposed similar administrative penalties on different plaintiffs, in accordance with the relevant provisions of the Administrative Procedure Law of the People's Republic of China and the Judicial Interpretation on joint litigation and joint trial, with the consent of all parties, the collegial panel decided to try the 12 cases jointly.

In accordance with the provisions of Article 13 of the Anti-Monopoly Law of the People's Republic of China (hereinafter referred to as the Anti-Monopoly Law), the Hainan Provincial Market Supervision and Administration Bureau found that the self-discipline convention, the resolution on the minimum self-discipline price, and the credit rating management measures jointly reached by the plaintiffs and other units excluded or restricted the price competition in the market of the fire safety technology testing industry, which was a monopoly agreement, and its behavior violated the provisions of "prohibiting business operators with competitive relations from reaching and implementing monopoly agreements that fix or change commodity prices". Therefore, the administrative penalty decision was made to order each plaintiff to stop the illegal act and impose a fine of one percent of the sales in 2018.

Each plaintiff was dissatisfied with the above-mentioned administrative punishment decision, separately filed an administrative lawsuit, and all requested that the corresponding administrative punishment decision be revoked, the main reasons for which were: First, the administrative punishment decision was found to be factually wrong. 1. The self-discipline convention, the minimum self-discipline price resolution, and the credit rating management measures limit the minimum price, rather than reaching an agreement to "fix or change the commodity price", and the above agreement has not yet taken effect without the unanimous consent of the fire control testing units; 2. The self-discipline convention and the minimum self-discipline price resolution are the provisions of the mandatory testing unit of the fire testing branch, not the agreement between the fire testing units, and the units have not been implemented in accordance with the standards of the self-discipline convention and the minimum self-discipline price resolution in the actual fire testing project operation. Second, administrative punishment decisions are erroneous in applying the law. The Hainan Provincial Market Supervision and Administration Bureau applied Article 46 of the Anti-Monopoly Law to the error that it used the total sales volume of each plaintiff in 2018 as the basis for calculating the fine, which also did not conform to the principle of "excessive penalties" in the Administrative Punishment Law of the People's Republic of China, and should use the sales of the goods involved in the case as the basis for calculating the fine.

The Hainan Provincial Market Supervision and Administration Bureau argued that the agreement reached by the plaintiffs and other business operators to change the price and the range of the price change in different circumstances should be regarded as a monopoly agreement in accordance with the provisions of Article 13, Paragraph 1 of the Anti-Monopoly Law; the plaintiffs paid a performance bond after signing the agreement involved in the case, and executed it in accordance with the charging standards agreed in the agreement in the testing service contract with outsiders, which is the performance of the monopoly agreement; and the provisions of Article 46 of the Anti-Monopoly Law. It should be understood that due to the fact that monopolistic behavior is extremely harmful to the market economy, it is difficult to set higher fines, it is difficult to achieve effective disciplinary effects, and in order to play an effective deterrent effect on business operators, it has set a relatively strict legal liability for business operators who implement monopoly agreements, and the Hainan Provincial Market Supervision and Administration Bureau believes that "sales in the previous year" should be understood as the total sales of business operators involved in the previous year according to the degree of damage to the market competition situation of the monopoly agreement.

The Intellectual Property Court of Hainan Free Trade Port exercised its monopoly administrative case adjudication function in accordance with the law, gave full play to the advantages of a multi-person collegial panel, and completed the trial of 12 cases at a time on the basis of the exchange of evidence before the trial. The members of the collegial panel divided their labor and cooperated, asked targeted questions about the focus of the dispute between the two sides, and the parties fully expressed their opinions, and the trial process was orderly, efficient and smooth. The use of a five-member collegial panel to try similar cases has saved judicial resources, reduced litigation costs, and improved litigation efficiency. Yan Li, a second-level inspector of the Hainan Provincial Market Supervision and Administration Bureau, appeared in court to respond to the lawsuit, which fully reflected the awareness and attitude of administrative organs in administering according to law and accepting judicial supervision, mass supervision, and public opinion supervision. The whole trial was broadcast live online, and more than 70,000 people observed it online.