The Higher People's Court of Guangdong Province made a first-instance judgment on the unfair competition dispute between Tencent QQ and Qihoo 360 on 25 April 2013, holding that Qihoo constituted unfair competition, and ordering Qihoo to pay a compensation of RMB 5 millions to Tencent for the latter's economic losses and reasonable right-safeguarding expenses, and to apologize on Qihoo 360's official website and relevant media.
The Higher Court mentioned in its decision that Qihoo was not entitled to, under the name of checking for virus or protecting users' interests, access the running process of another network service provider's legal software, modify the other's software at their own discretion, and disrupt the legal business operation of others. Additionally, Qihoo put their own products onto Tencent QQ's interface to promote their products by using the vast user resources of QQ and expand the users of 360's software and services, which not only caused serious economic losses to Tencent, but also increased the transaction opportunities of Qihoo. This was in contrast to the principles of good faith and fair competition and constituted unfair competition.
This case involves the largest damages award on Internet unfair competition cases in the territory of China. Qihoo publicly announced that Guangdong Higher People's Court's judgment was unfair, and has decided to appeal to the Supreme People's Court.