International Law

Anti-monopoly Litigation Phase II ? China Mobile

By Stan

This story is interesting to anyone following the implementation of China’s still relatively new Anti-monopoly Law and the implementation of a competition law system in this country.

Everyone at this point knows that the most famous case so far was the recent rejection of Coke’s bid for domestic juice company Huiyuan on the grounds of market concentration. If you saw that as the chief use of the AML, think again. The WSJ blog has the latest twist on the use of the AML:

China Mobile, the largest domestic mobile phone operator and the world?s largest operator by subscribers, is being sued in Beijing under China?s new anti-monopoly law. The case was accepted by Dongcheng District Court last week, according to Chinese-language media.

The plaintiff, Beijing-based lawyer Zhou Ze, alleges that China Mobile has abused its dominant market position. Zhou says the company has been charging additional monthly fees and charging subscribers different fees for substantially similar services. Zhou is seeking 1,200 yuan ($175) in compensation (an amount equal to his basic mobile fees for the last two years) and he wants the company to stop charging different fees.

Interesting that the case was brought by a lawyer. Hell of a lot of lawyer-based litigation and activism in China over the past few years. Even more interesting, of course, is that a huge domestic company’s business practices are being challenged on the basis of the AML. Everyone is probably asking whether this is a sign of things to come.

I am wholly ignorant of competition law and practice in other countries, with a tiny exception in the area of IP licensing. So I can’t really come at this from a comparative perspective.

My initial reaction is that these kinds of cases (assuming we see more) seemingly straddle competition issues and consumer issues. The latter are generally addressed in the Consumer Law and the Anti-unfair Competition Law. As usual, if there are several grounds available to a plaintiff, you often see choices being made (if a choice is made at all) based on available compensation. Not sure if that is applicable in these cases — gotta take another look at the AML at some point.

I hope these small domestic cases continue to get noticed by the press so folks can start to evaluate trends in AML litigation. To the extent that the defendants are large, well-known enterprises, that should help.

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Full post as published by China Hearsay on April 06, 2009 (boomark / email).