2019年，中國反壟斷訴訟進入了新時代。2018年，中國反壟斷法實施已滿十週年，三家執法機構實現了“三合一”整合，反壟斷配套法規相繼出台，一系列立法、執法、司法方面的變化將深刻影響反壟斷訴訟的發展並帶來新的趨勢。本文發表於《錢伯斯全球執業指南：反壟斷訴訟》2019年版(Chambers Global Practice Guide: Antitrust Litigation, 2019)，將總結2018年至2019年上半年期間中國反壟斷訴訟的亮點、熱點，為讀者呈現中國反壟斷訴訟發展的新趨勢：
一是反壟斷訴訟案件數量似乎有所減少。2018年，中國僅立案66起一審反壟斷民事訴訟案件，為2013年以來的最低點。然而，這一統計並未包含提出反壟斷抗辯或反訴的案件，可能不能反映我國反壟斷民事訴訟的真實面貌。我國反壟斷訴訟中原告極低的勝訴率可能是導致立案數量低的原因。
二是法院和反壟斷執法機構對於轉售價格維持（RPM）的不同認定標準逐步制度化。對於RPM行為，反壟斷執法機構採取“本身違法”原則，而法院採取“合理分析”原則。認定標準的不同引發了我國首個關於RPM的司法審查案件——裕泰案，最高法考慮到我國當前的政治和經濟背景，認可反壟斷執法機構對RPM採取“本身違法”原則，無需證明行為產生了“排除、限制競爭效果”。
三是司法審查有益於制定規則，這一做法可能常態化。除了裕泰案，2018年還有兩起反壟斷行政訴訟案件挑戰反壟斷執法機構作出的處罰決定。特別是在海基業案中，法院認可了執法機構關於協同行為的認定和處罰規則，這些規則後續也被納入至相關法規中。儘管原告在所有的反壟斷司法審查案件中均敗訴，但是不斷增長的案件數量表明，司法審查具有常態化的趨勢。
四是針對行政壟斷的行政訴訟成為了一大亮點。近年來，我國關於行政壟斷的行政訴訟不斷增多。2018年的汕尾公交訴汕尾市政府排除、限制競爭案正是一個典型案例。法院認定政府違反了招投標的程序性規定，指定單一公交公司作為當地的獨家經營者，構成行政壟斷。
五是新的“飛躍上訴”機制將使部分反壟斷訴訟案件直接上訴至最高法。2019年起，我國反壟斷訴訟案件的管轄權迎來了重大變革：由知識產權法院、中級人民法院一審審理的反壟斷民事訴訟和不服行政處罰的行政訴訟的上訴案件，將跨越省高院，直接上訴至最高法知識產權法庭，中國版本的“飛躍上訴”機制相應確立。這一機制的確立將有助於推進裁判標準的統一、提高裁判效率。
Chambers And Partners Antitrust Litigation 2019 - China Trends and Developments
Jet Deng Ken Dai
In 2018 and the first half of 2019 several cases, as well as new legislation, have brought about important developments in both substantive and procedural aspects of antitrust litigation in China. These developments, combined with the celebration of the tenth anniversary of the coming into effect of China’s Anti-Monopoly Law (AML) and the consolidation of China’s three antitrust authorities into the State Administration for Market Regulation (SAMR) in 2018, have pushed antitrust litigation in China into a new era and some fresh trends have emerged.
Antitrust litigation in China can be split into two main categories: civil and administrative. Antitrust civil litigation covers disputes arising from monopoly agreements and abuses of dominant market position conducted by business operators (including private individuals, legal persons and other organisations). Antitrust administrative litigation covers disputes arising from administrative monopolies exploited by public authorities or competent organisations, as well as decisions or penalties made by antitrust authorities. Additionally, when antitrust authorities fail to carry out investigations as requested by complainants, they can be sued for failure to perform their duties in ordinary, but antitrust-related, administrative litigation. Administrative Litigation is a specialised category of lawsuit against government authorities under Chinese law. Indeed, antitrust administrative litigation is a significant and unique feature of Chinese competition law. Below we will explore how these various types of litigation developed in the past one-and-a half years.
I. The Amount of Antitrust Litigation Seems to be in Decline
In 2018, there were 66 examples of newly filed first-instance antitrust civil litigation in China, which was the lowest level in six years (72 cases in 2013, 86 in 2014, 156 in 2015, 156 in 2016 and 114 in 2017). It seems antitrust civil litigation is declining after the peak years of 2015 and 2016.
However, these figures may not entirely accurately represent the state of antitrust litigation in China. First, it is understood that these figures may only include those cases based on the AML, not civil cases where antitrust defence or counter claim is brought into the case. It is increasingly common to find suits for damages deriving from breach of contract in which defendants claim that the contract is void due to breach of the AML. Second, these figures cannot reflect the development of specific types of antitrust civil litigation such as follow-on actions and cases related to resale price maintenance (RPM). Third, these figures do not, of course, cover antitrust administrative litigation, which is increasingly widespread and an important way for businesses to protect their interests.
If first-instance antitrust civil litigation (including suits involving antitrust defence and counterclaim) is indeed declining, it may be attributed to the extremely low win rate for plaintiffs. There is no discovery mechanismin China and plaintiffs losses are mainly due to failure to meet the burden of proof. China’s Supreme People’s Court (SPC) has recognised this issue and is seeking for a solution. At present, public enforcement of the AML still has adominant position in comparison to private enforcement.
II. Institutionalisation of Different Approaches toward RPM by Courts and Antitrust Authorities
The most important substantive development in antitrust litigation in China is the Yutai case decision in which the SPC showed respect to the antitrust authorities’ treatment of RPM as illegal, per se, although the court system adopts a 'rule of reason' approach.
To celebrate the tenth anniversary of the enforcement of China’s AML, the SPC selected and issued the ten most representative antitrust civil litigation cases of the past ten years in November 2018. Within the SPC’s list, two cases are RPM-related. One is Rainbow v Johnson & Johnson, which is the first high profile (but not the first ever) RPM case where the court adopted the'rule of reason' approach and required the plaintiff to prove the anti-competitive effect of the defendant’s RPM practice. The other one isGuochang v Gree. The main difference between the two is that in the first casethe plaintiff ultimately won the appeal by proving the anti competitive effect of the RPM in the relevant medical device market, while in the latter the court failed to find any anti-competitive effect in the relevant airconditioner market.
By contrast, Chinese antitrust authorities have adopted the per se rule (or rule of “prohibition and exemption” in their vocabulary) in over 20 RPM cases, and imposed fines totaling over USD1.5 billion. This divergence ultimately led to the first RPM judicial review case: the Yutai case. After being fined for RPM by a local antitrust authority, Yutai brought antitrust administrative litigation against the authority and won the first-instance trial where thecourt ruled that the authority failed to prove anti-competitive effect. However, in the second-instance trial, and more importantly in the SPC’sretrial in December 2018, the authority won and the SPC recognised that the antitrust authorities do not need to prove anti-competitive effect in their public enforcement in the current political and economic context of China.
After Yutai, the courts and antitrust authorities may continue to adopt different approaches toward RPM unless the AML is amended. In the meantime, more potential conflicts are expected. It is reported that China’sAnti-Monopoly Committee under the State Council will soon release the long-awaited antitrust guidelines, including one for the automobile industry. According to its draft version, certain types of territory and customer restriction in the industry (such as restrictions on distributors’ passivesales and restrictions on distributors’ sales of auto parts to consumers) will be treated as vertical monopoly agreements and illegal, per se, by theantitrust authorities. However, the courts may continue to use the 'rule of reason' when handling these non-RPM vertical monopoly agreements. Interestingly, in the SPC’s ten-case list, a consumer lost his suit against an auto maker and its authorised dealer for, among other things, not providing auto parts for sale outside the dealerships.
III. Judicial Review Contributes to Rule-Making and May Become Normal Practice
In addition to Yutai, two other instances of antitrust administrative litigation were brought in 2018 to challenge the penalties imposed by the antitrust authorities. In particular, the Haijiye case confirmed the court’s recognition of two important substantive rules in public enforcement. First, concerted practices, even in the absence of a written agreement between competitors, are unlawful. Second, administrative monopoly which causes the competitors’ concerted practices cannot exempt the competitors from antitrust penalties.
In the SAMR’s new regulations on monopoly agreements and abuse of dominance, which were enacted in July 2019, the two substantive rules recognised in Haijiye are preserved, and the SAMR added a new provision on the reduction of penalties in cases where monopolistic conduct is caused by administrative monopoly. This new provision may be more acceptable to business operators in similar cases in the future.
To date, the plaintiffs have lost in all antitrust judicial review cases (although Yutai scored a temporary win in the first instance). This is partly due to the relatively straightforward nature of these cases and the superior position of the antitrust authorities in exercising discretion when enforcing the AML. Some business operators, probably wisely, have not even tried to bring a judicial review case. The increasing number of cases, however, indicates that the trend may be for judicial review to become normal practice.
Among the reasons to believe this are that:
- the AML is still new in China and has not yet become familiar to many mid-and small-sized businesses, they may challenge what they deem to be unreasonable penalties, even in explicit cartel cases;
- some immature areas in the AML such as non-price vertical monopoly agreements and abuses of collective dominance may lead to actions seeking declaratory relief or clarification of the rules; and
- the newly introduced 'leapfrog appeal' mechanism, which we will explore below, may encourage plaintiffs and their lawyers to try their luck before the SPC.
On the other hand, the newly integrated SAMR may become more aggressive and take a firmer stance when it is in conflict with the judiciary, and its influence might ripple into the antitrust litigation field.
Interaction between the courts and the antitrust authorities is also increasingly prominent in two other areas. One is follow-on actions. Although a growing number of plaintiffs choose to claim damages after the defendants have been penalised by the antitrust authorities, it remains highly difficult towin. This is because the findings and decisions of the antitrust authorities are only prima facie evidence which needs to go through a second test in the courts. The other is administrative litigation against the antitrust authorities for failure to perform their duty to initiate investigations as requested. There were several such cases in recent years brought by consumers or companies, but none were successful on the plaintiffs’ side. The courts reasoned that the duties of the antitrust authorities are to protect market competition, the collective interests of consumers and society as a whole rather than individual interests.
IV. Administrative Litigation against Administrative Monopoly Features in Chinese Courts
The fourth pillar of China’s AML is administrative monopoly. In recent years, the Chinese government has issued a number of policies to curb the widespread and deeply rooted practice of administrative monopoly in China, and public enforcement in this area is also quite active. This trend has inspiredmore private enforcement against administrative monopoly.
Some private enforcement has produced satisfactory results, but not all. The Shanwei Bus case is a good example of the meagreness of some private enforcement – ie, it cannot undo what has already been done in certain circumstances. Shanwei is a city in Guangdong Province, and its government chartered a new bus company to be the sole operator in the local market and rescinded the licence of the incumbent firm. That firm sued the government for designating the new operator prior to the completion of the normal bidding process, which violated the procedural rules and excluded competition. The court in the second instance recognised the procedural violation by the government and confirmed the nature of the administrative monopoly in question. It refused, however, to revoke the licence, as the new operator had been inplace for three years at the time of the decision and the public interest would have been adversely impacted if its licence were revoked. Indeed, China’s Administrative Procedure Law explicitly provides for such an exemption.
Nevertheless, administrative litigation against administrative monopolies continues to grow and has received strong support from the courts. Importantly, the leadership of the Chinese government is committed to letting the marketplay the decisive role in resource allocation.
V. New Leapfrog Appeal System Leads Part of the Antitrust Litigation to the SPC
According to a decision issued by the National People’s Congress on 26 October 2018 and a follow-up regulation by the SPC, beginning in 2019, appeals arising from antitrust civil and administrative litigation that challenge administrative penalties (if tried by the intellectual property (IP) courts and intermediate people’s courts in the first instance) shall be directly submitted to the SPC, and heard by its newly established intellectual property court, skipping the provincial high people’s courts. This sets up a Chinese version of the 'leapfrog appeal' mechanism.
The purposes of this judicial reform are to promote consistency in ruling standards, strengthen protection of IP rights and optimise the business environment. Although mainly targeted at IP rights protection they are equally applicable to antitrust litigation. Inconsistent rulings (for example) wheresome local courts adopt the 'rule of reason' in cartel cases are a recognised problem. Other courts are accused of a bias against businesses registered inother provinces or countries. The 'leapfrog appeal' mechanism will make improvements in this respect.
It should be noted that the 'leapfrog appeal' mechanism does not apply to all antitrust lawsuits. Some antitrust civil litigation is tried by the district or basic level people’s courts approved by the SPC; these cases’ appeals would be submitted to the corresponding intellectual property courts or intermediate people’s courts. Also, it may not apply to cases merely involving antitrust defence and counterclaims. For antitrust administrative litigation, the mechanism will only apply to cases challenging the SAMR’s administrative decisions or penalties, and whose first-instance trials are at Beijing’s First Intermediate People’s Court. Cases challenging the administrative decisions or penalties of the provincial administrations for market regulation, as well as cases about administrative monopoly and the failure to perform duties, arecurrently not within the scope of the 'leapfrog appeal' mechanism.
There have, so far, not been any publicly available SPC rulings made under the 'leapfrog appeal' mechanism. It therefore remains to be seen how it will function and what improvements there will be. Finally, retrials of the SPC’s second-instance rulings can be heard before itself, but by a different division (probably the IP Tribunal).
In addition to the trends and development explored above, some other interesting issues deserve sustained attention as they remain untested before the SPC. First, whether antitrust disputes are arbitrable. Jiangsu High People’s Court, based on the public interest nature of the antitrust issues involved, did not uphold arbitration. Second, what methods for calculating fair, reasonable and non-discriminatory (FRAND) rates for standard essential patents(SEP) are used. Huawei and IDC settled before the SPC in December 2018 and no judgment was made or released. Third, whether the SPC will apply the exemption clause for certain minor cartel activity, frequently seen in previous cases, perhaps the SPC and the SAMR will jointly establish a de minimis rule. Fourth, whether consumer associations will be allowed to bring antitrust litigation on behalf of consumers as a whole (they have successfully done so in other areas). Overall, antitrust litigation is one of the most dynamic fields under China’s AML regime.