On 1 December 2020, the Shanghai Municipal Administration for Market Regulation (Shanghai AMR) published the local “Anti-Monopoly Compliance Guidelines for Undertakings” (Shanghai Guidelines), which will come into effect on 1 March 2021. This makes the Shanghai AMR the first region in China to issue recommended local standards guiding undertakings in constructing a comprehensive antitrust compliance model, after the State Administration for Market Regulation published the “Guidelines on Anti-Monopoly Compliance for Undertakings” (SAMR Guidelines) on 11 September 2020. In fact, most of the articles in the Shanghai Guidelines correspond to or supplement those in the SAMR Guidelines.
The Shanghai Guidelines target undertakings in Shanghai and can also be referenced by trade and industry associations. They set out the basic requirements that undertakings have to fulfil to compete in the market and encourage them to establish their own competition compliance management systems to prevent and reduce risks of breaching antitrust law.
Ten Major Compliance Mechanisms
In establishing a comprehensive competition compliance management system, the Shanghai Guidelines suggest undertakings to set up the following compliance mechanisms:
What Should Undertakings in China Do?
Although the Shanghai Guidelines are not mandatory, undertakings based in Shanghai are advised to closely comply with them in addition to the SAMR Guidelines and to build (and continuously evaluate and improve on) an effective competition compliance management system, with duties and responsibilities of different tiers of relevant personnel clearly delineated. Undertakings based elsewhere in China are advised to also refer to the Shanghai Guidelines, as local authorities of other regions may start rolling out their own local standards soon.
Please feel free to contact the authors if you would like to know how Mayer Brown can help you design a competition compliance management model or help localise your current model to fit in with the Shanghai Guidelines or SAMR Guidelines; or if you would like to discuss any part of this legal update.