China Issues Provisions on Several Issues Concerning Laws Applicable to the Trial of Civil Disputes Arising from Monopolistic Activities

On June 1, 2012, the Supreme Court Provisions on Several Issues Concerning Laws Applicable to the Trial of Civil Dispute Cases Arising from Monopolistic Activities (“Provisions”) came into effect. The Provisions are China’s first-ever judicial interpretations applicable to anti-monopoly related trials. The Provisions make some important changes to the usual rules regarding burden of proof and are likely to lead to an increase in private litigation.

According to the Provisions, any individual, legal person or other organization may file a lawsuit directly if it suffers losses due to monopolistic conduct or is involved in disputes over violations of the PRC Anti-Monopoly Law relating to contracts, articles of trade associations or other agreements. The existence of an investigation or decision by an enforcement body will not be a prerequisite to pursuing a private action in court against an individual or company. In cases relating to abuse of dominance or cartels, the defendant must prove that the alleged behavior did not have an anti-competitive effect. State-owned companies facing trial for abuse of dominance will be presumed to be dominant unless they can show otherwise. In addition, a plaintiff may rely on public statements made by a defendant as evidence of a dominant position. The parties may use industry or economic expert witnesses to provide market research or economic analysis reports on specific issues. If a contract or articles of a trade association are found to breach anti-monopoly related laws or regulations, they will be declared invalid. Finally, if a defendant is found to have acted in breach of the anti-monopoly related laws or regulations, the court may order it to stop the infringing activity and pay damages in compensation. The full Chinese text of the Provisions can be found here.