Comments to the SMPC on Shanghai Municipal Anti-Unfair Competition Regulation

2020-10-24 | Beijing, Shanghai

In general, the regulations have specified articles under the framework of Anti-Unfair Competition Law, added internet-related content, and combined with the current credit system rules. It is a rather detailed legislation with high practicality. As a witness and beneficiary of China's economic miracle, we are very grateful to Chinese government’s determination on maintaining a fair market.  At the beginning of this year, the new Anti-Unfair Competition Law came into effect, which, in its commercial competition provision, released companies from certain business restraints.  We welcome this change.  However, it is still confusing when defining the “Influence” provided in commercial bribery article.  For example, it is uncertain whether the secondary dealers or retailers without direct transaction relation would be deemed as having “influence”, which however will have unpredictable effects on many ways doing business.  Under this situation, companies that cares about compliance operation would always be conservative, and therefore will not try certain business model without clear guidelines.  On the contrary, companies with lower compliance sense for the purpose of perusing profit will carry out such business models.  That means the companies having full respect on law would be placed in a disadvantage situation when competing in the market.  Therefore, we hope the definition regarding “Influence” can be clear and predictable, which can help create a fair environment market.  Of course, we have strong belief that China’s government have determination and ability on this, we look forward to further explore our business with China’s economic prosperity.