The Content of Public Interest as an Exemption under Chapter Five of

There is no clear definition made either in the AML or in any other legislation as the meaning of the term ‘public interest’. The content of ‘public interest’ has been enumerated in some laws; for example, in the Trust Law,150 Article 60 makes reference to the public interest, including:

(1) relief for the poor;

(3) helping the disabled;

(5) developing medical and public health services;

(6) developing environment protection services and maintaining ecological environment, and;

(7) developing

imilar approach is also a

ticle 12 of the Administrative License Law.152 On the contrary, in som mple, the Real Right Law,153

ailed explanation of the term, and without examples being given.154

the context of the AML, it has been suggested that the public interest is the consume while some conside

public interest includes improving the develop

150

The Trust Law of the People’s Republic of China [中华人民共和国信托法] was promulgated by the Standing Committee of the National People’s Congress (SCNPC) and took effect on October 1, 2001.

151

Public Donation Law of the People’s Republic of China [中华人民共和国公益事业捐赠法_{] was promulgated by}

the presidential order of the PRC and took effect on September 1, 1999. 152

Administrative License Law of the People’s Republic of China [中 华 人 民 共 和 国 行 政 许 可 法] was promulgated by the presidential order of the PRC and took effect on July 1, 2004.

153

Real Right Law of the People’s Republic of China [中华人民共和国物权法] was promulgated by the and took effect on October 1, 2007.

c interest is elics, heritages and landscapes,

the public. presidential order of the PRC

154

Ibid., see Articles 7, 42 and 148. However, the enumeration of public interest was provided in the draft of the Real Right Law and raised an important debate on this issue. The draft states: ‘[p]ubli

public road traffic, public health, the prevention and cure of disaster, science, culture and education undertakings, the protection of environment, the protection of culture r

the protection of public water sources and diverting and draining water areas, the protection of forest, and other public interest regulated by national laws’. This draft is not published to

155

social employment, protecting the environment and other natural resources, and relieving the victims of a

nd environmental quality…. They can be defined as the services,

Th s:

com e

dir e

pub s. Reasonableness

relates to the balance between this public interest and other private or public interests

exe inc

international competitiveness of domestic enterprises, protecting trade,

disaster.156 This concept is similar to ‘services of general interest’ (SGI) in the EU, although the term SGI does not appear anywhere in EU competition law or in the EU Treaty.157 However, the Commission explained SGI in the 2007 Communication on SGI,158 stating that:

‘[t]hese services are essential for the daily life of citizens and enterprises, and reflect Europe’s model of society. They play a major role in ensuring social, economic and territorial cohesion throughout the Union and are vital for the sustainable development of the EU in terms of higher levels of employment, social inclusion, economic growth a

both economic and non-economic, which the public authorities classify as being of general interest and subject to specific public service obligations.’159

e concept of ‘public interest’ in the AML should consider three characteristic monality, reasonableness, and legitimacy. Commonality requires that the interest b ected universally, and not to a specific ‘stakeholder’ or ‘stakeholders’. Generally, th

lic interest cannot be owned by a group of people or interest group

which may be jeopardised in the attainment of the public interest. Finally, legitimacy requires that a public interest should be based on the need of the universal public and should correspond to regulations in substantive law and procedural law.

A particular focus should be applied when the public interest is treated as a ground for mption for abuse of administrative power under the AML. The public interest ludes economic and non-economic interests. The public interests listed in Article

156

Economic Law Office of Legislation Committee of Standing Committee of the National People’s Congress, Provision Explanation, Legislating Reasons and Relative Regulations about the People’s

Republic of China Anti-Monopoly Law [《中华人民共和国反垄断法》条文说明、立法理由及相关规定], (2007) Peking

University Press, at 3. 157

See A. Jones and B. Sufrin, note 27, at 569. 158

Note 126. 159

he cy gh ly or

hinese AML, the protection of the ‘lawful business operation conduct’ of SOEs in industries concerning the lifeline of the national economy and

cy.163 None of these concentrations between the large SOEs made under the directions of administrative power have been reviewed by the AML authority.164 15(4) of the AML, such as conserving energy, protecting the environment and relieving the victims of a disaster, are generally non-economic interests, while the term public interest in Article 28 relates more specifically to economic matters, for example optimisation of production, and improving an undertaking’s competitiveness in international markets.160

Any reliance on the public interest as a basis for exemption should be justified strictly. T public interest is generally the aim and reason for governments to adopt or pursue a poli or measure, but any such measures are operated and further explained in practice throu the use of administrative power. There is an ever-present risk that in purporting to app the public interest, the Administrative power-holder may adopt some illegal inappropriate actions.

In the instance of the C

national security or in industries implementing exclusive operations and sales according to law may also be a ‘public interest’.161 In 2006, the State-Owned Assets Supervision and Administration Commission of the State Council (SASAC) published a notice on encouraging the adjustment and reorganisation of large SOEs to improve international competitiveness. 162 In 2010, the State Council published another document to re-emphasise this poli

160

See X. Wang, note 17, at 9-11. 161

See Article 7 of the AML. 162

The Guidance Opinion about Promoting the Adjustment of State-owned Capital and the reorganisation of State-owned Enterprises [关于推进国有资本调整和国有企业重组指导意见_{] was published by the SASAC and}

forwarded by the General Office of the State Council on December 5, 2006. 163

Opinions of the State Council on Promoting Enterprise Merger and Restructuring [国务院关于促进企业兼并重 组的意见] was published by the State Council on August 28, 2010.

164

Until November 2011, the number of Central SOEs had reduced from 196 to 117. See:

http://www.gov.cn/jrzg/2011-11/14/content_1992430.htm (last visited March 1, 2012). However, there is no record about the review of business operator’s concentration relating to two SOEs by the Anti-Monopoly Bureau. See: http://fldj.mofcom.gov.cn/static/ztxx/ztxx.html/1 (last visited March 1, 2012), especially cases of the concentration between China Unicom and China Netcom in 2008, Power Construction Operation of China and China Energy Engineering Group Co. Ltd in 2011. See

ntentSearch?id=13877803

http://xxgk.sasac.gov.cn/gips/co ;

hanjing/gsnews/20090501/02536174627.shtml

eeds to be fulfilled. The case law of SGEI can be a useful reference point for the AML in the analysis. The public interest should be an exemption for reasonable

Thi e AML and Article 106

E ble 4.1 provides a comparative

sch Art acti

In practice, the purported purpose of ‘improving optimum distribution of SOEs resources and international competitiveness’ actually becomes subsumed within the ‘public interest’ rubric, and the abuse of administrative power in this context becomes exempt from the application of the AML. Whether a conduct of an administrative power has legitimately or reasonably complied with the content of public interest in legislation is a key issue of evaluating administrative conduct in China. As a result, a requirement for strict justification may avoid the excessive reliance on the public interest by administrative power holders.

In terms of applying an exemption in Chapter Five, the public interest is not the only condition that n

economic activities or in relation to the conduct of administrative power but should not be abused in its application. A careful examination between the balance of the effects of the public interest justification, and competition rules should be considered. Similarly as determined in EU case law, the public interest should only provide an exemption for the activities violating provisions in Chapter Five of the AML when a restriction of competition is essential to allow performance of the designated legitimate task.165 The application of the public interest as an exemption to the abuse of administrative power under the AML will be further analysed in the next chapter with the consideration of free circulation provisions in the AML.