Conflict and Coordination Between Sectoral Regulation and Competition Law Enforcement in the Information Industry

Li Huiying, Jan 25, 2012

As competition for Chinese internet information services is getting fiercer, violations of the law have also gradually increased. For example, irregular business management and infringement of users’ lawful rights and interests have taken place from time to time. As a result, the Ministry of Industry and Information Technology (“MIIT”) published the Provisions on Standardizing the Internet Information Service Market Order (the “Provisions”) on December 29, 2011. The Provisions establish specific prohibition rules, including Articles 5 and 40, on illicit competition and infringement of users’ lawful rights and interests that are all common in the internet field.

The Provisions have, to a great extent, specified the rights and obligations for internet business operators as well as those governing the relations between such operators and users. Significantly, the Provisions also standardize the competition order in the internet industry, pushing forward the healthy development of the industry and protecting the lawful rights and interests of consumers.

It is understandable that MIIT, as the regulator of the information industry, has laid down regulations to supervise the internet industry. Yet, since the regulations published by MIIT include not only supervision over internet technologies, but also over the internet market and information service providers, there is potential for conflict and overlap between the industry-specific regulations and competition law, understood in a wide sense, encompassing the rules of both the Anti-Monopoly Law and the Anti-Unfair Competition Law in China. Conflicts between competition supervision by MIIT and law enforcement by the authorities responsible for cases brought under the Anti-Monopoly Law or the Anti-Unfair Competition Law will also be triggered.

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