China's new antitrust law comes into force on 1 August - and is already generating strong comments about its potential ramifications for non-Chinese firms operating in China.
Rumours abounded
recently that, ahead of the new August law, Microsoft and other foreign
software and technology companies were being investigated by the
Chinese State Intellectual Property Office for potential "monopoly activities". The Chinese government has denied this claim.
The Chinese press is also preparing the ground for the new law. Reuters
quotes Hewitt Pate, a former U.S. antitrust enforcement official, as
saying, "there were a lot of statements in the Chinese press that China
needed an antitrust law to combat the excesses of foreign firms."
Given the market shares of foreign companies such as Microsoft and
Intel, the Chinese government could be reluctant to protect the
intellectual property of these firms, Reuters writes. The new law will
allow smaller Chinese businesses to take multinationals to court over
market domination or price fixing. Speculation seems likely to continue
surrounding the new law, and analysts are awaiting the first test cases
to be filed before commenting on how antitrust will be enforced
henceforth in China.
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