The Communist Party of China (CPC) is considering expanding the size of the anti-monopoly agency and strengthening its operations while wielding a heavy hand on the Internet giants. Foreign media reported that anti-monopoly expert Dong Hongxia will be the deputy director of the anti-monopoly bureau, and 20 to 30 additional professionals in related fields will be recruited.
Since the second half of last year, the Chinese Communist Party has been stepping up anti-monopoly regulation of Internet giants and has been imposing heavy fines on companies under investigation since this year, including Alibaba, Baidu and Vipshop.
At the end of April, Tencent was fined RMB 1 million (about NTD 4.3 million) by the State Administration of Market Supervision for violating the anti-monopoly law in its acquisition case, and Meituan, an e-commerce platform, is being investigated for alleged monopolistic practices.
However, the Chinese Communist Party officials did not stop after achieving the purpose of “making an example of the monkey”, but further strengthened the supervision force.
According to a report in the Wall Street Journal on March 3, China’s State Administration of Market Regulation is considering expanding its antitrust bureau, which is responsible for antitrust operations, and one of the measures is to add a deputy director.
The report cited sources familiar with the matter as saying that the new deputy director has been identified as Dong Hongxia, an expert on antitrust issues who currently serves as the director of the antitrust bureau’s division in charge of reviewing M&A transactions. The personnel order is expected to take effect in the next few months and is the first time in the history of the Antimonopoly Bureau to have three deputy directors, reflecting the unit’s growing regard and elevated influence.
The report further mentions that as the authorities continue to increase their regulatory efforts, the department that reviews M&A transactions will also add a number of mid- and lower-level officials to its ranks.
In addition to management, Reuters recently reported that China’s State Administration of Market Regulation is planning to hire professionals in the antitrust field, with 20 to 30 more expected to be hired on top of the current 40.
The Wall Street Journal quoted sources as saying that another aim of the Chinese Communist Party’s strengthened antitrust bureau is to “take on” Chinese online technology companies registered in offshore tax havens.
The report mentions that many Chinese companies use this as a way to get money from foreign investors, but Chinese law does not clearly regulate whether this meets the regulatory standards of the anti-monopoly law. Therefore, since the end of last year, the relevant authorities have required Chinese companies registered outside of China to make a centralized declaration on any such transactions. At the same time, the Antimonopoly Bureau will begin to conduct retroactive enforcement.
Sources close to the matter said that the Antimonopoly Bureau already has about 1,700 relevant cases in its possession.
The report quoted University of Hong Kong law professor Zhang Huyue as saying that this top-down enforcement action is a drastic change for the otherwise relatively small Antimonopoly Bureau.
The report described how the Antimonopoly Bureau’s popularity has also increased rapidly in recent months due to the successive strikes against the giants.
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