Chapter 1: Why does China need an Anti-Monopoly Law?
Anti-monopoly law is a legal system that opposes monopolies and protects competition in the market. The original meaning of ‘monopoly’ is for one business entity to control an entire market. However, because actions that restrict competition can lead to the monopolization of markets, some countries, such as Germany, also refer to ‘anti-monopoly law’ as the ‘law against restrictive competition’. Therefore, the term ‘monopoly’ has been broadened to include various acts that restrict competition. In the United States, anti-monopoly law is called ‘antitrust law’ because the establishment of large trusts can stifle competition, leading to market monopoly structures. Anti-monopoly law is a basic legal foundation for a national market economy system. Following China’s entry into the World Trade Organization (WTO), China should follow the basic WTO rules, learn from the experiences of other nations while taking into consideration China’s unique circumstances, and strive to establish and improve its socialist market economy legal system as soon as possible. Among these, quickly establishing and improving the legal framework for China’s Anti-Monopoly Law is of particular importance and urgency. The key tenet of anti-monopoly law is the opposition to monopolies, the opposition to restrictions on competition, and the protection of companies’ rights to participate in market competition. Therefore, in order to recognize the importance of establishing and strengthening anti-monopoly law in China, we first should understand the importance of competition in a market economy. This is mainly reflected in the three following aspects.