But given that China is just now finding its zeal for regulating corporate dominance, one wonders: why? The United States has a long history with anti-monopoly and trust-busting laws. Starting 1 August, the maximum fine for undeclared mergers will increase to 5 million yuan, or roughly $747,000 – 10 times the current fine. In recent months, China has also updated its Anti-Monopoly Law to reflect its newfound resistance to homegrown monopolies. In Sunday’s statement, SAMR noted that, while it was fining offenses committed when the government prioritized foreign acquisitions, these were all “past deals that should have been reported but were not.” The regulator also stated that it would accelerate the process of reviewing old deals “to help companies move forward with a lighter load.” In November, the antitrust arm was renamed the State Anti-Monopoly Bureau and launched to vice-ministerial status, upsizing its budget and manpower. These companies faced a cumulative fine of 21.74 billion yuan, or around USD $3.25 billion.Īt the same time, SAMR kickstarted a hiring spree that expanded the bureau nearly 30%. What followed was a flurry of government investigations throughout 2021 that saw a whopping 98 fines imposed on major internet and platform-based companies like Meituan, JD, Baidu, Alibaba and Tencent. The first trickles started in late 2020 when Ant Group – an Alibaba affiliate – saw its high-profile IPO suspended. The current campaign against monopolistic behavior began in late 2020 with Beijing’s new push to stunt the growth of Chinese Bit Tech Companies. It was during that period that the regulator began looking toward mergers wholly contained within the Chinese market, too. (For instance, in 2017, Japanese giant Canon was fined 300,000 yuan prior to announcing its takeover of Toshiba Medical Systems.)Īnd then, in 2018, anti-monopoly review authority passed to SAMR during a government reshuffle. But it wasn’t until December 2011 that the Ministry of Commerce first published regulations stipulating punishments for antitrust activities.įollowing new regulations, the Ministry of Commerce, which primarily handled foreign trade and investment, investigated deals involving outside parties. Under the law, all merger deals with “potential monopoly implications” were required to submit to regulatory review before proceeding. China’s Anti-Monopoly LawĬhina’s Anti-Monopoly Law first came into effect in 2008, long before today’s tech giants commanded such enormous market-moving potential.The original law was designed to target foreign companies that China believed could use mergers and acquisitions to dominate the Chinese market. Instead, each case was fined 500,000 yuan (around USD $74,600), the maximum amount under current law. Notably, authorities didn’t order the companies to undo any deals. SAMR documents revealed that authorities determined these deals breached anti-monopoly laws between March and May of this year. SAMR also fined a joint venture between health tech company Ping An Healthcare and Japanese conglomerate SoftBank. Other offenders include video site Bilibili, social media operator Weibo and private equity firm Citic Capital. (Both Alibaba and Tencent were fined for antitrust activities last November, as well.)įour more fines were imposed on Didi, China’s Uber equivalent. One fine targeted the company’s 2011 acquisition of a 20% stake in shoe-selling website Okaybuy Holding. Social media and video gaming giant Tencent – which owns TikTok – was slapped with 12 accusations.
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