Draft amendments to the Anti-Monopoly Law were sent for review with new data algorithm constraint clauses

Pei Yu, a reporter of this newspaper, reported from Beijing

In the context of anti-monopoly and the prevention of disorderly expansion of capital, the Anti-Monopoly Law, which has always been known as the "economic constitution" in the field of jurisprudence, has been revised for the first time after 13 years of implementation. At the 31st Session of the Standing Committee of the 13th National People's Congress held in Beijing on October 19, the Anti-Monopoly Law of the People's Republic of China (Draft Amendment) (hereinafter referred to as the "Draft Amendment") was sent for deliberation.

In the Draft Amendment, basic and institutional contents such as "strengthening anti-monopoly law enforcement" and "establishing and improving the fair competition review system" have been added. At the same time, "encouraging innovation" was also included in the Draft Amendment. The Anti-Monopoly Law is responding to current social concerns by means of legislation and law revision, and promoting social modernization and the development of the rule of law.

It is worth noting that the Draft Amendment specifically adds basic content for the platform economy and the Internet, and sets special provisions for internet platform enterprises to abuse data, algorithms, technology and capital advantages, platform rules to eliminate competition and restrict competition, and the standardized and healthy development of Internet platforms is very obvious to the legislators.

Revised after 13 years

"The strengthening of anti-monopoly law enforcement, don't think about it, is also a trend, it will only be strengthened more and more, and law enforcement will become more and more professional and scientific." A person from the compliance department of a large Internet platform company told the China Business Daily that they are now very concerned about the dynamics of laws and regulations, and are currently working with business departments and external legal consulting agencies to study the relevant content of the "Amendment Draft".

In August 2007, the 29th session of the Standing Committee of the Tenth National People's Congress deliberated and passed the Anti-Monopoly Law, which came into force on August 1, 2008. If calculated from this point in time, by 2021, the current Anti-Monopoly Law has been promulgated and implemented for more than 13 years, during which time, there are many voices from all walks of life that the Anti-Monopoly Law should be amended and adjusted to adapt to the environmental changes brought about by social and economic development.

The reporter learned that the revision of the Anti-Monopoly Law was included in the work plan of the Anti-Monopoly Committee of the State Council in 2018, and the "Revised Draft" was formed in January 2020, at the same time, as the central department that undertakes anti-monopoly functions after the institutional reform, the State Administration for Market Regulation has formulated a number of administrative rules, as well as 6 work guidelines, including the Anti-Monopoly Guidelines on the Platform Economy. Subsequently, on October 19, 2021, the relevant amendments were submitted to the 31st Session of the Standing Committee of the 13th National People's Congress for deliberation in the form of the Draft Amendment.

Zhang Gong, director of the State Administration for Market Regulation, was entrusted by the State Council to explain the Draft Amendment to the current meeting of the Standing Committee of the National People's Congress. Zhang Gong said that in the process of implementation, the Anti-Monopoly Law has shown that the relevant system provisions are more principled, the punishment for some monopolistic acts is not enough, and the law enforcement system needs to be further improved.

On October 16, 2021, Qiushi magazine published a signed article by Xi Jinping, General Secretary of the CPC Central Committee, President of the People's Republic of China, and Chairman of the Central Military Commission, entitled "Solidly Promoting Common Prosperity". In the article, Xi Jinping clearly pointed out that "a negative list of access to sensitive areas should be drawn up and anti-monopoly supervision should be strengthened."

Basic system

In the field of jurisprudence, the Anti-Monopoly Law has always been called "Economic Constitution", and the reason for this title is that the Anti-Monopoly Law has built the basic system of competition in the form of legislation. Therefore, in the revision and adjustment of the Anti-Monopoly, the establishment and improvement of the basic system are the key points.

A number of senior figures in the legal circles engaged in anti-monopoly work told reporters that the basic institutional construction of the "Amendment Draft" mainly focuses on two major aspects, on the one hand, the establishment of a fair review system, on the other hand, the strengthening of anti-monopoly law enforcement work, in addition, the encouragement of innovation will also be written into the "Amendment Draft", they all agree that this reflects the country's major policies.

Article 5 of the Draft Amendment is a new content: the State shall establish and improve a fair competition review system. Administrative organs and organizations authorized by laws and regulations to have the function of managing public affairs shall conduct a fair competition review when formulating provisions involving the economic activities of market entities.

"Prior to this, the content of the fair competition review of market entities involved in the market has also been stipulated in the documents of the relevant State Council and ministries and commissions, and this time it has risen to the level of the Anti-Monopoly Law, which has a higher legal status for the maintenance of the fair competition environment attribute of the policy promulgation, especially for administrative monopolies, which has a preventive effect." The above-mentioned senior legal person told reporters.

It is worth noting that before the Draft Amendment was sent to the People's Congress for deliberation, the Hainan Free Trade Port had already passed local legislation to stipulate that all market entities must conduct a fair competition review before all market-related policies are introduced. In addition, Article 10 of the Draft Amendment is also a new addition: the state has perfected and perfected the anti-monopoly rule system, enriched the anti-monopoly regulatory force, strengthened anti-monopoly law enforcement, and maintained the order of fair competition.

Anti-monopoly enforcement forces are indeed in the process of strengthening. Recently, the Anti-Monopoly Division, a subsidiary of the State Administration for Market Regulation, which has anti-monopoly functions, is recruiting personnel to expand the manpower of the law enforcement team. The information obtained by the reporter shows that the recruitment personnel plan is 18 people, accounting for more than half of the total number of recruits by the State Administration of Market Supervision.

Platform-specific terms

The above-mentioned Internet platform company compliance department told reporters that in addition to the strengthening of anti-monopoly law enforcement capabilities, they are more concerned about the "Amendment Draft" of the "Anti-Monopoly Law", which specifically adds content to the field of Internet enterprises and platform economy. "We will definitely pay close attention to this kind of targeted clause." She said.

The reporter noted that the new content of Article 10 of the Draft Amendment, after explicitly strengthening anti-monopoly law enforcement, clearly states that business operators must not abuse data and algorithms, technology, capital advantages and platform rules to eliminate restrictions on competition. The above-mentioned compliance department said that they were particularly concerned about this content and strengthening anti-monopoly law enforcement in "the same Article 10".

At the same time, in article 22 of the Draft Amendment, in the list of "abuse of market dominance", in addition to the seven situations in the original law, a new content has also been added: Where a business operator with a dominant market position uses data and algorithms, technology, and platform rules to set up obstacles to impose unreasonable restrictions on other business operators, it is an act of abusing the dominant market position.

"This may be one of the main contents of our compliance work in the future, and it is necessary to compare it with the new laws and regulations to see whether the development of specific businesses has touched the legal red line of abusing market dominance." The above-mentioned Internet platform enterprise compliance department told reporters. Recently, the state monopoly supervision and law enforcement departments have successively issued anti-monopoly fines for the monopolistic behavior of a number of large Internet platform enterprises.

"It can be expected that law enforcement in the Internet field will remain a top priority in the future." The senior antitrust legal source told reporters.

Zhang Gong also said in the description of the revision that the revision of the Anti-Monopoly Law adheres to the principle of attaching equal importance to standardization and development, and further improves the anti-monopoly-related system and increases the punishment for monopoly behavior in view of the prominent problems existing in the implementation of the Anti-Monopoly Law, so as to provide a clearer legal basis and a more powerful institutional guarantee for strengthening anti-monopoly and preventing the disorderly expansion of capital.

(Editor: Meng Qingwei Proofreader: Zhai Jun)