Cartel Agreement In Chinese

To apply the first five categories of exemption, a professional must also demonstrate that such an agreement must not significantly restrict competition in the market in question and that consumers are able to share the benefits of the agreement. The court found that the 31 members of the Water Association are competitors. The Water Federation organized a price-fixing agreement and imposed fines on members who sold scallops at a reduced selling price, thereby preventing internal competition among Association members, affecting normal price variation and increasing sales profits, leading to the elimination and reduction of competition. The behaviour of the Water Federation mentioned above is therefore that an association organizes its members to enter into a monopoly agreement to set the price of a commodity, which is contrary to the AML. Penalties for non-compliance with the MRA include fines of between 1% and 10% of the offender`s total turnover. [4] It is not certain that penalties for infringements may be less than 1% of the offender`s turnover. The AML does not explicitly state whether such penalties are calculated on the basis of global turnover or Chinese turnover, but neither the AML nor the execution procedures include calculations of limited penalties on Chinese turnover. In addition, precedents in other legal systems, including Europe, seem to indicate the broader measure. However, if the anti-competitive agreement has not yet been implemented, a relatively small fine cannot exceed RMB500,000 (approximately $75,000).

In addition, agencies may order the recovery of illegal profits, a measure that could be significant in some cases. On July 27, 2016, the NDRC made public its decisions to fine three local pharmaceutical companies (d. Huazhong Pharmaceutical Co, Ltd (Huazhong), Shandong Xinyi Pharmaceutical Co, Ltd (Shandong Xinyi) and Changzhou Siyao Pharmaceuticals Co, Ltd (Changzhou Siyao), in a total amount of approximately 2.6 million yuan for the conclusion and implementation of monopoly agreements on active ingredients of estazolam (APIS) and in violation of Article 13 of the AML. NDRC rules provide that the Agency may grant the first company “immunity” from self-reporting and provide “significant evidence” of an anti-competitive agreement. Similarly, the NDRC may “reduce” the penalty for future applicants. In addition, the AML also contains fundamental rules regarding investigative procedures and sanctions by Chinese antitrust authorities against cartel violations. In the meantime, the LSA is currently changing as more and more new themes appear and require changes. Finally, the AML does not provide for criminal sanctions for violations of the monopoly.

However, recent reports have been reported on criminal investigations (probably under criminal law) against cartel actors who have coerced others to participate, and recent updates to the NDRC`s administrative sanctions provisions for price violations indicate that certain price-related offences that “disrupt the organization of the market” may also be subject to criminal prosecution. [5] [2] Similarly, companies that had antitrust effects in China after the MRA came into force on August 1, 2008 may not have applied for leniency in China and may wish to reconsider the matter. Section 14 of the MRL governs, among other things, vertical monopoly agreements, including the practice of maintaining the resale price, so that it does not fit within the scope of this analysis.

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