Basic Context of Fair Competition Governance in China

A more urgent need for fair competition

As we work to develop a unified national market, there is a pressing need to ensure fair competition. By working faster to establish an efficient, well-regulated, and open unified domestic market featuring fair competition, we can provide an important guarantee for creating a new development dynamic and promoting high-quality economic development. At present, bottlenecks still affect the domestic economy, and instances of local protectionism and market segmentation still occur. We must keep working to reinforce the foundational status of competition policies, focus on correcting improper competitive practices and market interference, and enhance the market environment for fair competition.

Fair competition is also urgently needed to promote the sound development of the private sector. The private sector is a vital driver of Chinese modernization and provides an important foundation for high-quality development. At present, some private enterprises still face difficulties and challenges in ensuring their survival and development. We must keep working to implement fair competition policies so that the private sector continues to grow bigger, do better, and become stronger as a result of fair competition.

Finally, fair competition is urgently needed to effectively stimulate vitality for innovation and creativity. Innovation is the primary driver behind high-quality development and the key to shaping new drivers and advantages for development. At present, we are still seeing frequent violations of competition law that undermine innovation. We need to refine our competition oversight systems and regulatory approaches to cultivate an enabling climate for innovation, encourage innovative progress, safeguard the fruits of creativity, and enhance the returns of innovation. This will pave the way for positive reinforcement between competition and innovation.

An increasingly complex market competition ecosystem

The rapid evolution of China's vast market presents new challenges. With more than 180 million business entities, over 1.4 billion consumers, and a middle-income group of over 400 million people, China has become a vast market endowed with a series of unprecedented features specific to this development stage. The interests of all stakeholders are becoming diversified, the variety of goods and services has increased significantly, management levels and compliance awareness among business entities vary widely, and there is still an imbalance in development among regions and among urban and rural areas. Such factors have significantly increased the intricacy of fair competition governance. New challenges have also arisen as a result of increasingly complex competitive and cooperative relationships among businesses. Enterprises’ competitive behaviors are becoming much more diverse and complex due to the common development of enterprises under all forms of ownership, rapid integration of online and offline markets, accelerated industrial upgrading, and faster innovation of business forms. To safeguard and promote fair competition, we must give play to the advantages of large enterprises to boost their core competitiveness while also protecting the space micro, small, and medium enterprises need for innovation and development. We will support platform companies to play a leading role in driving development, generating employment, and engaging in international competition, while also protecting the rights and interests of the entities operating on these platforms and facilitating the development of the real economy. These tasks pose significant challenges in establishing a market environment for fair competition.

The increasing stealth and sophistication of illegal competitive practices have also presented new challenges. As new technologies and business models emerge, more industries and business entities are becoming technology-intensive. This shift has led to more technically intricate and covert illegal competitive behaviors, increasing the difficulty of oversight, early warning, detection, evidence collection, and adjudication. These developments have imposed higher demands on dynamic, incisive, and digital regulation to ensure fair competition.

A graver international landscape

Pressure to advance alignment with high-standard international competition rules and bolster the appeal of China's ultra-large market has increased. The latest round of international economic and trade rules generally places a stronger emphasis on the issue of fair competition. This has created a more pressing need to accelerate efforts to improve the legal and policy framework for fair competition and cultivate a business environment that is market-oriented, law-based, and internationalized.

There is also greater pressure on our efforts to extensively participate in the governance of international competition and protect the legitimate rights and interests of enterprises that operate internationally. Against the backdrop of more intensive rivalry between major countries, Chinese enterprises face significant challenges in protecting their rights on the global stage and engaging in economic globalization. This has created a growing need to diversify China's competition policy toolkit, better coordinate with competition rules in the international arena, and bolster support for Chinese enterprises so they can more effectively participate in global market competition and cooperation. 

Pressure is also amounting to regulate multinational corporations' monopolistic practices and enhance the competitiveness and stability of industrial and supply chains. In recent years, some Western countries have zealously pursued technological monopolization, repeatedly imposing blockades against China. Certain multinational corporations have abused their first-mover advantages by raising market entry barriers, thereby cutting down the development space of Chinese enterprises. This has created an urgent need to regulate, in accordance with the law, the monopolistic actions of multinational corporations and safeguard the environment for the innovative development of Chinese enterprises.

Editor: Nie Qiaoyu