Problems before the courts

It is believed that the AML apparently rely on the administrative enforcement system rather than the judicial system to handle anti-monopoly cases.327 _{This is, partly due to the fact that}

three administrative enforcement authorities already handled competition issues prior to the enactment of the AML. After all, the public enforcement of the AML should play the primary role in implementing the competition policies. Judges are less informed about particular industries while administrative officials of the public enforcement authorities have devoted themselves to studying competition issues in the areas supervised by these authorities.328 _In

other words, judges to some extent are generalists while administrative officials are specialists.

Relying on the administrative authorities to enforcement the AML is also the result of the limited capabilities of the Chinese judicial system. Some doubt has been cast on the designated Chinese courts’ ability to implement the AML since generally speaking the judges have insufficient training in competition law and economics.329 _{Moreover, China is a civil law}

September 2014. According to the written record of this briefing, 849 cases were cleared unconditionally, 4 cases were cleared with conditions and 2 cases were rejected. But apparently the amount of cases cleared with conditions is wrong in this briefing. According to MOFCOM website (http://fldj.mofcom.gov.cn/article/ztxx/?), the amount of conditionally cleared merger cases should be 24, otherwise the total amount of completed merger cases would not be 875.

326 _{The statistics of EU merger cases could see http://ec.europa.eu/competition/mergers/statistics.pdf, last visited on}

27 January 2014.

327 _{See Bruce M. Owen, Su Sun and Wentong Zheng, ‘China’s Competition Policy Reforms: The Anti-Monopoly}

Law and Beyond’ (2008) 75 Antitrust Law Journal 231, p264.

328 _{See Angela Huyue Zhang, ‘The Enforcement of the Anti-Monopoly Law in China: An Institutional Design}

Perspective’ (2011) 56(3) The Antitrust Bulletin 631, p656.

329 _{See H. Stephen Harris and Rodney J. Ganske, ‘The Monopolization and IP Abuse Provisions of China’s}

Anti-Monopoly Law: Concerns and A Proposal’ (2008) 75 Antitrust Law Journal 213, pp.214, 226-227. See also Bruce M. Owen, Su Sun and Wentong Zheng, ‘China’s Competition Policy Reforms: The Anti-Monopoly Law and Beyond’ (2008) 75 Antitrust Law Journal 231, p242; Subrata Bhattacharjee, ‘The Merger Review Process under the New PRC Anti-Monopoly Law: Selected Issues’ (2008) A.B.A. Section Antitrust 9 (presenting at the New Chinese Anti-Monopoly Law Teleseminar, 23 January 2008); Mark William, Chapter 4 ‘China’ in Mark William (ed) The Political Economy of Competition Law in Asia (Edward Elgar 2013) 88, p96.

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country where there is no place for ‘judge-made’ law. Like administrative authorities’ brief and conclusory decisions, Chinese judges are not used to writing detailed opinions. Against the background of the vague AML, undertakings could not foresee what courts will do under a particular circumstance without binding precedents under similar circumstances. 330

Consequently, a modern competition culture in China is difficult to be established as long as Chinese courts are not capable of understanding and interpreting, in a consistent way, the careful drafting competition policies, as well as guidelines and decisions adopted by the Anti-Monopoly Committee and the enforcement authorities.331

On top of these general shortcomings which make it difficult to establish a competition culture through judicial branch, the quality and quantity of the judicial review cases and the civil anti-monopoly cases have been respectively influenced by some other factors. As to the judicial review of an administrative decision pursuant to the Administrative Procedure Law332_,

defendants might not be willing to lodge an appeal owning to the complicated procedures of administrative litigation and, more importantly, the persistent bias of the Chinese courts in favour of government authorities.333 _{The Chinese courts are perceived as being lack of}

independence and influenced by local governments which favour local enterprises (inter alia SOEs located in that region) in competition with the defendant, creating the perception that it is meaningless for the defendant to seek for judicial review.334 _{As to the private enforcement, the}

limited amount of civil litigations is due to the fact that the burden of proof imposed on the plaintiff is difficult to satisfy. This is partly because of the lack of an adequate discovery system in relevant civil procedural laws so the plaintiffs have problem in collecting evidence, and partly because of the plaintiffs’ lack of understanding of competition law therefore they might

330 _{See Bruce M. Owen, Su Sun and Wentong Zheng, ‘China’s Competition Policy Reforms: The Anti-Monopoly}

Law and Beyond’ (2008) 75 Antitrust Law Journal 231, p242.

331 _{H. Stephen Harris and Rodney J. Ganske, ‘The Monopolization and IP Abuse Provisions of China’s}

Anti-Monopoly Law: Concerns and A Proposal’ (2008) 75 Antitrust Law Journal 213, p227.

332 _{Administrative Procedure Law of the People’s Republic of China (adopted by the National People’s Congress,}

issued on 4 April 1989 and effective since 1 October 1990, translation available by subscription at

http://www.lawinfochina.com/display.aspx?id=1204&lib=law&SearchKeyword=&SearchCKeyword=%D0%D0% D5%FE%CB%DF%CB%CF%B7%A8, last visited on 20 January 2014)

333 _{See Bruce M. Owen, Su Sun and Wentong Zheng, ‘China’s Competition Policy Reforms: The Anti-Monopoly}

Law and Beyond’ (2008) 75 Antitrust Law Journal 231, p241; H. Stephen Harris and Rodney J. Ganske, ‘The Monopolization and IP Abuse Provisions of China’s Anti-Monopoly Law: Concerns and A Proposal’ (2008) 75

Antitrust Law Journal 213, p226.

334 _{See H. Stephen Harris and Rodney J. Ganske, ‘The Monopolization and IP Abuse Provisions of China’s}

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not be able to provide sophisticated economic analysis to support their claims.335 _{Therefore the}

chance to win a civil anti-monopoly case is slim. So far in China there has been only two civil anti-monopoly cases reported in which the plaintiffs won the cases.336