China Voice: Antitrust law shields fair market

The latest antitrust case involving luxury car maker Mercedes-Benz is a further indication of China's firm stance on ensuring fair market play through strict law enforcement.

The company was fined 350 million yuan (56 million U.S. dollars) on Thursday by Chinese authorities on price fixing charges following an antitrust probe. This is the heaviest penalty of its kind for a single company in China's automobile industry.

Just two months ago, a record 6.09-billion-yuan fine for U.S. chip maker Qualcomm, which was found to have abused its market dominance by charging discriminatory licensing fees, became the most costly antitrust penalty ever handed down by China.

These cases always easily lead to claims of China alienating foreign firms to protect domestic industries or of the business environment in China getting less friendly. However, such speculation is misplaced.

The attitudes of the violators, first of all, suggest no unfair treatment by China.

On the part of Mercedes-Benz, the company said it respected the antitrust order by Chinese authorities and would accept the punishment, pledging measures to ensure its sales procedures comply with Chinese laws and regulations.

San Diego-based Qualcomm said in February it would honor the fine and modify its licensing practices, giving up the right to further legal proceedings contesting the findings by the National Development and Reform Commission (NDRC), China's top price regulator.

As China is building a fair and more open market, no company will be allowed to break the law with impunity. Whether a firm is Chinese or foreign makes no difference.

China's antitrust law enforcement since last year has targeted domestic and foreign firms, both private and state-owned enterprises. The NDRC has investigated 335 enterprises and industry associations, 33 of them foreign, over monopolies.

State-owned giants China Telecom and China Unicom have been subject to antitrust probes. Distillers Kweichow Moutai and Wuliangye were each fined more than 200 million yuan last year for monopolistic practices.

To ensure transparency and openness, all anti-monopoly decisions by the NDRC are published online. Through training programs such as the biannual EU-China Competition Week held since 2011, China has also shared details of its practices with Europe and learned from European experience.

Shielding nothing more than a fair market, China's antitrust law enforcement is in fact becoming more recognized around the world. Qualcomm has faced new antitrust investigations in the United States, Europe and South Korea following China's probes.

As China seeks to advance rule of law, businesses, domestic and foreign alike, should bear in mind that any practice that harms competition or consumers' interests will be duly handled. Endi