In China, Anti-Monopoly Laws Don't Apply to SEOs

Caixin is reporting that while there have been arrests, Mao-era self-criticisms, and corruption investigations into foreign companies this month, the anti-monopoly law which is five years old this year has been used only twice against state owned enterprises (SOEs).

The first use of the law was against TravelSky, which was "informally" investigated for price fixing, but eventually led to zero arrets or punishments.  The second time a company was held up on anti-trust charges was in 2011, when an investigation was dropped against China Unicom and China Telecom - this particular case dropped the most both companies asked for it to be dropped.

By contrast, in August, the National Development and Reform Commission imposed record fines on no less than six foreign companies, following a swift investigation into price fixing.

The NDRC pocketed £71 million in fines.  Such laws in China are passed to offer some comfort to foreign companies who need reassurance that their products or services are going to be protected to some extent by rule of law, but selectively enforcing laws to suit the financial needs of shady characters in government does little to inspire confidence.

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