China to Amend Antitrust Law for the First Time in 13 Years

Focus on Increasing Fines and Expanding Discretion of Supervisory Bodies

Jack Ma, founder of Alibaba (Photo by Reuters)

[Asia Economy Reporter Yujin Cho] Chinese authorities are pushing for an amendment to the Antitrust Law that will increase fines for companies violating the law by up to 10 times starting next year and expand the discretion of regulatory agencies.

According to the South China Morning Post (SCMP) in Hong Kong on the 28th, China's legislative body, the National People's Congress (NPC), has begun revising the Antitrust Law to increase fines for antitrust violations related to mergers by 10 times the current amount.

This is the first amendment attempt in 13 years since the Antitrust Law was enacted in 2008, aiming to strengthen control over big tech companies by raising the level of fines (penalties).

The amendment to the Antitrust Law was submitted to the NPC Standing Committee last week and is expected to be implemented as early as next year after review.

Professor Angela Zhang of the University of Hong Kong said the draft amendment focuses on increasing fines and expanding the discretion of the State Administration for Market Regulation (SAMR), the market regulatory agency, interpreting this as a clear signal to strengthen control over giant technology companies.

Professor Zhang also stated that the draft includes a provision to increase fines for merger-related violations to 5 million yuan, which is 10 times higher than the current law.

It is also reported that the draft includes a provision allowing the SAMR to impose fines of up to 1 million yuan on legal representatives, executives, and officers of companies directly responsible for violations of the Antitrust Law.

Since the end of last year, Chinese authorities have been conducting comprehensive investigations into big tech companies, including Alibaba Group, the largest e-commerce company. The authorities, led by Chinese President Xi Jinping, are accelerating the application of extensive regulations across all industries such as platforms, healthcare, and finance under the banner of the "common prosperity" policy.