China’s adoption of the Anti-Monopoly Law (“AML”)is a landmark in the evolution of China's economic transformation. The AML was a carefully thought-out, negotiated, strategic development dictated by the central government, a process that started almost twenty years ago. China has moved from a centrally planned command economy to one that is largely, despite the existence of state-owned enterprises as major players, a free market economy. The AML is the ultimate recognition on the part of the Chinese government that free and fair competition in the market place is in the essential interest of the Chinese people.

Recent enforcement activities raised concern among foreign companies about the fair and impartial implementation of the AML. The purpose of this primer is to provide a framework of the AML and how it is enforced.

A. General Background of the Anti-Monopoly Law -

Similar to the antitrust laws of other jurisdictions, the AML has as its purpose the safeguarding of healthy competition among companies in the market for the benefit of consumers. But due to China’s political structure and the tendency towards heavyhanded state intervention in the Chinese economy, the AML also supports China’s industrial policies.