China¡¯s 2008 Anti Monopoly Law has brought China into the modern world of anti-trust and competition laws. As the two year anniversary of the bill approaches, some areas of uncertainty have been made clear.

One issue that was relatively unclear at the time of AML implementation was what precisely triggers an anti-monopoly investigation of a company. AML¡¯s enforcement authority is divided among MOFCOM, the NDRC and SAIC. Article 38 of the AML governs the procedures for commencement of an AML case. Any suspected monopolistic behavior is investigated by the AML Enforcement Authority. Any entity or individual has the ability to report suspected monopolistic behavior. If the report has merit, the AML Enforcement Authority is required to investigate. Furthermore, the SAIC has published its own procedural rules, the ¡°SAIC Private Sector Investigation Procedures¡±, and the ¡°SAIC Procedures Regarding the Abuse of Administrative Power¡±. The NDRC is in the process of drafting procedures of their own.

A second issue relates to the field of mergers and acquisitions. More specifically, what types of companies have been reviewed. In foreign mergers, a summary of MOFCOM¡¯s review is released to the public. In domestic merger reviews, no such publication is required. ¡°This has created some uncertainty as to whether foreign or domestic mergers are under higher scrutiny,¡± said Edward E. Lehman, Managing Director of Lehman, Lee & Xu. ¡°Since no data is available for domestic merger reviews there is no definitive answer available,¡± Lehman added.

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