Anti-Unfair Competition Law

    China

    Anti-Unfair Competition Law

    The Anti-Unfair Competition Law of the People’s Republic of China (only available in Chinese here) (the Law) establishes requirements to prevent unfair competition in business and to protect the legitimate rights of business operators and consumers. In particular, the Law provides measures for the protection of trade secrets, against bribery and collusion, as well as defining legal liability in business. 

    Last Updated: July 30, 2019


  • Requirements

    The Law stipulates that business operators may not use property or other means to make bribes to sell or purchase goods. It is further noted that secretly providing a third party or individual a rebate, or inappropriate financial inducements outside of standard accounts, shall result in a consideration of bribery (Article 8 of the Law).

    Furthermore, the Law provides that ian operator sells or purchases goods, he or she can give a third party a discount in an express manner, and can issue an intermediary with a commission. In cases where the operator gives a third party a discount and an intermediary a commission, such provisions must be accounted for honestly. In addition, operators who accept discounts and commissions must also truthfully account for these provisions (Article 8 of the Law).

    If a business operator uses property or other means to make a bribe to sell or purchase goods, which constitutes a crime, it shall be investigated for criminal responsibility according to law. If it does not constitute a crime, the supervision and inspection department may impose a fine of up to RMB 10,000 (approx. €1300) or RMB 200,000 (approx. €26,000) according to the circumstances. If the law is illegal, the property or other means will be confiscated (Article 22 of the Law).

    Article 15 of the Law further provides that bidders and tenderers must not collude to raise or lower prices, or to exclude others from a competition. If collusion takes place, the bid will be rendered invalid and the supervision and inspection department may impose a fine of up to RMB 10,000 (approx. €1300) and RMB 200,000 (approx. €26,000) according to the circumstances (Article 27 of the Law). 

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