Clifford Chance

Antitrust in China and across the region: Quarterly Update July to September 2018

30 October 2018

Key points of interest in this quarter include the following:

Following Qualcomm’s failure to secure Chinese approval for its bid for NXP despite a number of extensions to the review timetable, many feared that the deteriorating state of US-China relations would have a chilling impact on the merger review process. Whilst there is anecdotal evidence of a slowdown in the review of some cases, the statistics for the latest quarter actually show an increase in the number of cases being reviewed by China's new competition agency, SAMR (up over 20% on the same period last year) with most still being cleared under the simplified review process. Moreover, the intervention rate in China remains low with only two deals in the last quarter requiring remedies - Linde/Praxair, which also attracted remedies in a number of other jurisdictions including the EU, India and Brazil and Essilor/Luxottica, which had attracted detailed scrutiny elsewhere due to the complementary nature of the parties' products. 

Also in China, last quarter saw the first ever fine imposed on individuals for obstructing an investigation. The case involved two employees of a car dealership business (one of whom was the inhouse counsel) who removed a USB stick whilst the officials were trying to retrieve documents from it. The fines imposed were modest – RMB 20,000 (USD 3,000) in total. Coincidentally, last quarter also saw Hong Kong's Competition Commission bring its first case against individuals for their participation in an alleged price fixing cartel in relation to renovation works on a public housing estate.  As well as seeking fines on the companies involved, the Commission is also seeking a financial penalty against two individuals and a director disqualification order against one of them. To complete the picture, individual employees were also fined in two cases decided this quarter in India.

Elsewhere in APAC, notable cases include the CCCS's decision to impose fines of SGD 13 million (USD 9.5 million) on Uber and Grab for completing an anti-competitive merger, the first fine of its kind in Singapore; Australia's ACCC instituting proceedings against Cryosite for taking steps to implement its merger with Cell Care prior to approval – another gun-jumping first in this voluntary filing jurisdiction; as well as failure to file or late notification fines issued in Indonesia and the Philippines.  Finally, mixed fortunes in the technology sector - in Japan, the JFTC terminated an investigation into Apple after Apple agreed to drop certain restrictions in its agreements with mobile network operators, but in Korea, Google was reportedly raided by the KFTC in relation to an inquiry into allegations that Google pressured games developers to sell exclusively through the Google app store.

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