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China steps up anti-monopoly in auto industry

Source: Economic Information Daily | Date: Oct. 12

  • The first draft of a guidance policy aimed at curbing monopolistic practices in the automotive industry is expected to be completed at the end of Oct., according to a source from the price supervision office of the National Development and Reform Commission (NDRC).

  • The draft will be submitted to the State Council's anti-trust commission in June 2016 for review. The policy not only provides anti-monopoly guidelines for auto parts production, supply, car sales and after-sales services, but also gives explanations to possible monopolistic practices in auto ecommerce business.

  • The policy is part of the Chinese government's efforts to keep the auto industry well-regulated through standardized and institutionalized anti-monopoly enforcement. The stipulations governing car sales, after-sales services, ecommerce, and parallel imports are highlights of the policy, but these rules are also so controversial that they have drawn heated debates.

  • Commenting on the issue about ecommerce, an expert from the China Automobile Dealers Association (CADA) recently pointed out that no matter what form ecommerce operators may take, their act of selling cars at extremely low prices is illegal because on the market, everybody is treated equal. That is the purpose of the anti-monopoly law - promoting fair competition. Nevertheless, the government is studying whether ecommerce-based pricing can be exempt from the anti-monopoly law, a researcher from the Chinese Academy of Social Sciences (CASS) told reporters.