Legal boundaries of Competition in the Area of Internet: Challenges and Judicial Responses

Zhu Li, March 20, 2016

Some new characteristics of competition in the Internet industry, e.g., competition for attention, innovation competition, cross-market competition etc., have brought about new challenges and difficulties for the legal regulation of competition. In virtue of the theoretical innovation and the innovation of law applicability, Chinese courts gave creative judicial responses in the scopes of Anti-Unfair Competition Law and antitrust Law, clarified the legal boundaries of competition and effectively regulated competition in the online environment. Certain trends and rules implicit in this kind of judicial responses are worth noting.

The growth of the Internet industry in our country has become a new engine for the development of domestic economy. The online technology has been updating rapidly; new products, new services and new business models have been emerging uninterruptedly, impacting existing models and established order of the traditional commercial community, changing the structure of commercial interests in the economy and the society. This process is accompanied with the increasingly fierce competition in the Internet area and the continuous emergence of new kind of competition that constantly challenge legal boundaries. At the early stage of Internet development, the challenge had mostly appeared to be the difficulties in protecting online copyright. In pace with the maturity and progress of the Internet technology, the scale of e-commerce enlarges rapidly, new business models relying on the Internet are emerging uninterruptedly, therefore the mentioned challenge has expanded to areas such as trademark protection, competition regulation, etc. in the Internet. By examining specific cases, Chinese courts have clarified and delimited competition rules on the internet, filled the legal gaps, and thus, played an important role in the regulation of competition on the Internet. First, the paper describes the characteristics of competition on the Internet. Second, it explores the special challenges this kind of competition has brought to the judicature, and third, the paper will analyze the creative judicial responses to the challenge, and endeavor to reveal the trend and the regular pattern in such judicial actions.

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