This summary discusses the following points:
- Civil cases are not conditioned upon administration investigations.
- Jurisdictions on Anti-monopoly cases are clarified.
- Burden of proof is re-allocated.
- More private actions are expected to be seen.
On 1 June 2012, the Rules of the Supreme People’s Court on Several Issues Concerning the Application of Law in Hearing Civil Cases Caused by Monopolistic Conduct (“the Rules”) became effective. The Rules contain 16 articles intended to correct the ineffectiveness of the Anti-Monopoly Law of the PRC (AML).
Highlights of the Regulations
Relationship of Antitrust Administrative Investigations and the Judicial Process The Rules have clarified the AML’s vague guidance of whether an administrative investigation and decision must be conducted before a civil case can be brought. They now clearly state that a plaintiff can either:
- Directly bring a civil action.
- Bring a civil action after the decision of the AML enforcement agencies is confirmed effective.
Clarification of Jurisdiction
Intermediate courts with more experienced judges now have jurisdiction for anti-monopoly cases. The Rules explicitly provide that civil monopoly cases of the first instance shall be heard by any of the following:
- Certain intermediate courts – e.g., as those in capital cities of the provinces.
- Cities separately listed on the State plan.
- Cities directly under the State Council.
- Cities designated by the Supreme Court .
Allocation of Burden of Proof
Previously, it was extremely difficult for a plaintiff to win an anti-monopoly lawsuit because of the difficulty in proof. The Rules have adjusted some burdens of proof for the three kinds of monopoly under the AML:
- Monopoly agreements.
- Abuse of dominant market position.
- Administrative monopoly.
The Rules, however, have only adjusted the first two kinds of monopoly activities.
For “horizontal agreements” it is the defendant’s responsibility to prove the agreement does not have anticompetitive effects. Otherwise, the defendant shall bear the adverse result against itself.
For “abuse of dominant market position”, the plaintiff must bear the burden of proof regarding the dominant position of the defendant in the relevant market and the abusive conduct. Defendants bear the burden of proving the justifications of its conduct if it asserts such a defense. In addition, the plaintiff can use information publicly released by the defendant as evidence of its dominance.
Limited Public Interest Lawsuit
Even the plaintiff has not been damaged and assumed the loss by the monopolistic conduct they can still claim a contract or an articles of associations of industry associations has violated the AML. However, in these instances the plaintiff cannot clam the damages and compensation if they didn’t incur any losses but the plaintiff could request the related parties to stop the activities. This is because in the past many courts refuse to accept cases due to lack of actual losses. These articles now pave the way for the public-interest law suit.
Expert Witness and Independent Professional Institutions
The Rules specifically stipulate that parties to litigations can apply to the court and entrust one or two specialists to testify at court hearings. They can also apply to the court to entrust an independent institution to conduct market survey or economic analysis.
The Rules have helped fill in the gap between the AML and its implementation in civil litigations, although a lot still remains uncertain. It is expected that, because of the Rules, AML private actions will play an increasingly important role in the AML enforcement regime of China.