LAWS & REGULATIONS

LAWS & REGULATIONS

    LAWS & REGULATIONS

    Regulations of Hainan Free Trade Port on Fair Competition

      Updated:2025-01-15 10:36:05 print size: big | general | small
    (Adopted at the 30th Session of the Standing Committee of the 6th Hainan Provincial People’s Congress on September 29, 2021)


    Chapter I
    General Provisions

    Article 1 These
    Regulations are enacted pursuant to the Hainan Free Trade Port Law of
    the People’s Republic of China, Anti-Unfair Competition Law of the
    People’s Republic of China, Anti-Monopoly Law of the People’s Republic
    of China, and other applicable laws and regulations, and based on the
    actual circumstances of Hainan Free Trade Port to expedite the development
    of a high-end Hainan Free Trade Port, improving and protecting fair
    competition, and protecting the legal rights of business operators and
    consumers alike.


    Article 2 The Hainan Free Trade Port shall improve fair competition by drawing on internationally
    accepted rules, improving the basic fundamental status of competition
    policy,protecting legal rights for all kinds of market entities equally
    pursuant to law, and developing a standardized and orderly competitive
    open market system.

    Article 3 The Hainan Free Trade Port shall guarantee business operators lawful and fair
    participation in market competition, expansion of business scale and
    improved market competitiveness in accordance with the law.
    Business
    operators shall abide by laws, regulations, and business ethics, follow
    the principles of honesty, trustworthiness, and fair competition,
    fulfill safety, quality, employee and consumer rights protection
    statutory obligations, and ecological environment protection, and abide
    by international trade practices when conducting business
    internationally.

    Article 4 The market regulation agency of the people’s government at or above the county level
    shall be responsible for fair competition oversight and administration
    within their respective administrative areas, investigate and penalize
    acts that impair fair competition, provide ex ante guidance on
    commercial competition for operators pursuant to law, and conduct fair
    competition awareness to the extent of their duties.
    The
    development and reform, commerce, and other people’s government
    agencies at or above the county level shall effectively conduct fair
    competition oversight and administration work subject to their duties.

    Article 5 The people’s government at or above the county level shall establish a fair competition deliberation and coordination institution which shall be responsible for the following matters:
    (a) preparing and issuing plans, schemes, rules, methods, and other documents that significantly impact the implementation of fair competition policies and reviews;
    (b) improving the overall coordination, guidance, and optimization of competition policy implementation, and organizing joint reviews of major policies and actions concerning economic activities of market entities;
    (c) integrating, coordinating, overseeing, and guiding the appropriate agencies and organizations to conduct fair competition reviews;
    (d) organizing, directing, and overseeing the appropriate agencies and organizations to
    conduct joint and specific law enforcement against activities that
    affect fair competition governance, and coordinating and encouraging the
    investigation and resolution of major and complicated cases across
    areas or agencies;
    (e) organizing the information system development for fair competition governance to improve smart fair competition governance;
    (f) organizing the investigation and evaluation of overall market competition, organizing the publicity
    of fair competition laws, regulations, and policies to explain and
    answer questions and respond to public concerns; and
    (g) other fair competition work as assigned by the government.

    Article 6 The Hainan Free Trade Port shall establish and improve the fair competition social
    co-governance system, develop a fair competition culture, and encourage
    and guide business operators to establish competition compliance
    programs. 
    Industry
    associations and other business operator organizations shall improve
    self-discipline, announce competition policies, guide and train business
    operators, guide and standardize lawful competition among business
    operators, and maintain the market fair competition order. Consumer
    organizations shall strive to improve their awareness and capacity to
    defend their rights and improve social oversight over actions that may
    impair fair competition.

    Article 7 The people’s government at or above the county level shall encourage the use of
    modern information technologies such as the Internet, big data, and
    blockchain to implement smart oversight, identify acts of illegal
    competition, identify and warn of market operation risks that may affect
    fair competition, improve oversight efficiency, and prevent and curb
    unfair competition and monopolies.

    Article 8 The people’s government at or above the county level shall encourage fair competition and collaboration with other Chinese regions to achieve joint law enforcement and information sharing.

    Article 9 The Hainan Free Trade Port shall improve international collaboration for fair
    competition policy creation, law enforcement coordination,
    communication and training,education and awareness, and competition
    culture improvement.

    Article 10 The people’s government at or above the county level and the appropriate agencies
    shall establish and improve the reporting system and the incentive and
    protection systems for whistleblowers, clear the reporting channels, and
    encourage, support, and protect all entities and individuals to
    lawfully conduct social oversight on acts that impair fair competition.

    Government agencies and their employees shall not support or cover up acts that may impair fair competition.


    Chapter II 
    Fair Competition Policies

    Article 11
    When issuing policies and actions closely related to economic
    activities of market entities, the people’s government at or above the
    county level and appropriate agencies shall respect the market economy
    rules, minimize the direct allocation of market resources, and direct
    intervention in market activities by the government, encourage the free
    and unrestricted flow of merchandise and factors, and take full
    advantage of the market’s decisive role in resource allocation.

    Article 12
    The people’s government at or above the county level and appropriate
    agencies shall encourage the transformation of industrial policies to
    generalization and functionality, improve the support for technological
    innovation and structural upgrades, and optimize coordination between
    industrial and competition policies.
    The
    people’s government at or above the county level and appropriate
    agencies should abide by the competition policies as the basis when
    issuing industrial policies, coordinate industrial policies,
    and other economic policies together, and take full advantage of the
    mutual improvement of different high-end economic development policies,
    optimize industrial competitiveness, and gather global high-quality
    production factors.

    Article 13
    The government and appropriate agencies shall treat different market
    entities equally pursuant to law and ensure that different market
    entities enjoy equal treatment in access permissions, business operations, factor acquisition, standards issuance, and preferential policies.
    The
    government and appropriate agencies shall not issue policies and
    actions that may infringe upon market entities’ legal rights or increase
    their obligations without basing such on laws, regulations, or State
    Council decisions and orders. Such government and appropriate agencies
    shall not abuse their administrative powers to issue policies and
    actions that exclude or restrict competition.

    Article 14 The people’s government at or above the county level and appropriate agencies shall
    encourage the reform of natural monopoly industries, open up businesses
    for competition, expedite the commercialization of areas open to
    competition, and improve the oversight of natural monopoly industries
    and monopolized portions.

    Article 15 The Hainan Free Trade Port shall implement a specific list to ease market access
    (special actions) and the Foreign Investment Negative List. All market
    entities may enter and compete equally in all sectors other than those
    specified in the Negative List pursuant to law.
    The
    Hainan Free Trade Port shall implement a negative list management
    system for crossborder service transactions. Domestic and foreign
    service providers may participate and compete equally in all sectors
    other than those provided by the negative list pursuant to law.

    Article 16 The Hainan Free Trade Port shall support the lawful, innovative, and sound development
    of the digital economy, regulate unfair competition and monopolies in
    new business areas such as platform and shared economies, and protect
    fair competition in the market.


    Chapter III
    Fair Competition Review

    Article 17 The administrative agencies and organizations authorized to manage public affairs pursuant to law shall implement the principle of fair competition and conduct fair competition
    reviews pursuant to provisions of the state and this Province when drafting local regulations,
    government rules, regulatory standards, other policy documents, and specific policies and ad hoc
    actions involving market access and withdrawal, industrial development, investment attraction,
    bidding, government procurement, business practice standards, qualification standards, and other
    economic activities of market entities. 

    Local regulations, government rules, and draft administrative normative documents
    concerning economic activities issued on behalf of the government shall not be submitted to the
    government for deliberation without a fair competition review. A fair competition review from
    the administration for market regulation at the same level must also be obtained before such
    regulations, rules, or regulatory standard drafts are submitted for deliberation.


    Article 18 The issuing or implementing agency shall evaluate their influence on the
    standardized market and fair competition pursuant to law after the implementation of local
    regulations, government rules, regulatory standards, other policy documents, and specific
    policies, or ad hoc actions relating to economic activities of market entities. Any such regulations,
    government rules, regulatory standards, other policy documents, specific policies, or ad hoc
    actions deemed to impair the market regularization and fair competition by the evaluation shall
    be promptly revoked or revised.

    Article 19 The government and the appropriate agency may introduce a third party
    evaluation in accordance with applicable law when conducting a fair competition review.

    Article 20 The people’s government at or above the county level shall include a fair
    competition review when assessing and evaluating the business environment, law-based
    governance, and other systems. 

    The people’s government at or above the county level shall implement an internal review
    plan for policies and actions, focus on policies and actions for industries and sectors which often
    receive complaints, have extensive problems, or abuse administrative authority to preclude or
    restrict competition from market entities. The results of the internal review shall be publicly
    announced in due course pursuant to law. Any entity found to exclude or restrict competition
    in the internal reviews shall promptly make the appropriate corrections, and those who fail
    to promptly make such corrections or fail to meet correction requirements shall be penalized
    pursuant to law.


    Chapter IV
    Acts Impairing Fair Competition

    Article 21 Business operators shall be prohibited from committing any of the following
    acts that disturb the order of market competition and infringe upon the rights of other operators or
    consumers as provided by laws and regulations:
    (a) committing acts that mislead others to believe that they offer the products or
    services provided by another business operator or have a particular connection with another
    operator; 
    (b) seeking transaction opportunities or competitive advantages through bribery or other
    means; 
    (c)
    directly or indirectly assisting other business operators to create
    false or misleading commercial advertising materials for goods and
    services to deceive and misinform
    consumers; 
    (d) infringing upon trade secrets; 
    (e) engaging in illegal sales promotions; 
    (f) creating and sharing false or misleading information that damages competitor business or
    product reputation; 
    (g) using technical means or other means to influence user choices to impair or stop
    the regular operation of networked products or services legally provided by other operators;
    or 
    (h) committing other acts that disrupt the market competition order and infringe upon the
    rights of other operators or consumers.

    Article 22 Business operators shall be prohibited from engaging in any of the following
    monopolistic practices as provided by law: 
    (a) entering into monopoly agreements with competing business operators or transaction
    counterparties, or the industry association coordinates the operators in the same industry to enter
    into monopoly agreements; 
    (b) abusing the business operator’s dominant market position; 
    (c) implementing the specific actions that may illegally exclude, restrict, or may exclude or
    restrict competition; or
    (d) committing other monopolistic acts provided by law. 
    Article 23 The administrative agencies and organizations authorized by laws and
    regulations to manage public matters shall not abuse their administrative power to exclude or
    restrict competition as follows: 
    (a) explicitly or implicitly require entities or individuals to operate, purchase, or use products
    or services provided by designated operators; 
    (b) hindering the free, inter-regional circulation of products or services;
    (c) excluding or restricting business operators from participating in bidding, land use
    rights grants, construction projects, real estate development, fnancing, procurement, and other
    economic activities; excluding or restricting foreign business operators from investing or setting
    up local ofces;
    (d) explicitly or implicitly forcing operators to engage in monopolistic acts provided by
    law; 
    (e) issuing and publishing government rules, regulatory standards, other policy documents,
    and specific policies and ad hoc actions involving economic activities of market entities and
    excluding and restricting competition; or

    (f) other acts involving the abuse of administrative power to exclude or restrict competition.


    Chapter V
    Investigating Acts Infringing Upon Fair Competition

    Article 24 The market regulation agency of the people’s government at or above the
    county level and the appropriate agencies shall abide by laws and regulations and agency
    responsibilities when performing their oversight responsibilities and investigating acts suspected
    of impairing fair competition. 
    The market regulation agency of the people’s government at or above the county level and
    the appropriate agencies shall promptly resolve any reports of acts suspected of impairing fair
    competition made in writing and supported by appropriate documentation and information.

    Article 25 Entities or individuals deeming government rules, regulatory standards,
    administrative normative documents, other policy documents, and specific ad hoc policies or
    actions issued have not gone through fair competition review or violate the review standards
    may submit a report to the issuing agency, request review, or offer review recommendations to
    the filing and review agency, or report to a higher level of the issuing agency and the market
    regulation agency. The appropriate agencies shall promptly manage such and the issuing agency
    shall promptly correct and announce such pursuant to law if the appropriate agencies confirm
    that the issuance of such have not gone through fair competition review or violate the review
    standards. Anyone suspected of violating the Anti-Monopoly Law of the People’s Republic of
    China shall be investigated by anti-monopoly law enforcement agencies pursuant to law. 
    Where the entities or individuals believe that local regulations violate the principle of fair
    competition, they may request review or offer review recommendations to the fling and review
    agency pursuant to law.

    Article 26 The market regulation agency of the people’s government at or above
    the county level and the appropriate agencies shall, ensure the investigated operators’ and
    stakeholders’ rights to representation and defense during the investigation, and complete the
    investigation within the time limit provided by laws and regulations; the investigation shall be
    completed within a reasonable time limit where the law does not provide a time limit for the
    investigation.
    The market regulation agency of the people’s government at or above the county level and
    the appropriate agencies may issue warnings to the operators and recommend corrections during
    the investigation through interviews and other methods pursuant to law.

    Article 27 The market regulation agency of the people’s government at or above the
    county level and the appropriate agencies may take the following actions in accordance with the
    regulations when investigating acts suspected of impeding fair competition: 
    (a) entering and inspecting the premises of the business suspected of impairing fair
    competition; 
    (b) questioning the operators, stakeholders, and other entities and individuals, and requiring
    them to provide information or other materials related to the acts being investigated; 
    (c) inquiring about and copying agreements, account books, bills, documents, records,
    business correspondence, and other materials related to the acts suspected of impairing fair
    competition;
    (d) seizing or confiscating assets related to acts suspected of impairing fair competition; 
    (e) inquiring about the bank accounts of operators suspected of impairing fair competition;
    or
    (f) other actions provided by laws and regulations.

    Article 28 Where the market regulation agency of the people’s government at or above
    the county level and the appropriate agencies require assistance from public security agencies
    when investigating acts suspected of impairing fair competition, the public security agency shall
    cooperate pursuant to law. 
    Where the acts suspected of impairing fair competition are under investigation, the business
    operators, stakeholders, and other entities and individuals shall not refuse or impede the law
    enforcement agencies in their investigation.

    Article 29 Where the supervisor commission, people’s courts, people’s procuratorates,
    and administrative law enforcement agencies find evidence of acts suspected of impairing fair
    competition when managing cases, they may hand over such evidence to the market regulation
    agency of the people’s government at or above the county level and the appropriate agencies.
    The market regulation agency of the people’s government at or above the county level and the
    appropriate agencies shall manage such pursuant to law.


    Chapter VI
    Legal Liability

    Article 30 Any administrative agencies or organizations authorized by laws and regulations
    to manage public affairs or their employees who abuse of position,
    commit dereliction of duty, or play favoritism and commit irregularities
    in the oversight and administration of fair competition shall be penalized pursuant to law. Those committing crimes shall be held criminally liable pursuant to law.

    Article 31 Administrative agencies or organizations authorized by laws and regulations to
    administrate public affairs abuse their administrative power and commit
    acts that exclude or restrict competition shall be ordered to make
    corrections by their higher-level agencies, and the person directly in
    charge and other directly liable employees shall be penalized pursuant
    to law. 
    The
    market regulation agency of the people’s government at or above the
    county level may submit penalty recommendations to the appropriate
    higher-level agency pursuant to law.

    Article 32 Consumers may report or bring litigation against acts that disrupt the order of competition or infringe upon consumer rights pursuant to law. 
    Where
    acts impairing fair competition infringe upon the legal rights of many
    consumers, the authorities and appropriate organizations as provided by
    law may file public interest litigation in the people’s court pursuant to law, and the market regulation agencies at all levels shall provide support pursuant to law.

    Article 33 Any illegal act provided in these Regulations shall be included in the public credit
    information system pursuant to applicable regulations and announced
    pursuant to law; those entities and individuals on the list of
    untrustworthy entities shall be penalized by the appropriate agencies pursuant to law.

    Article 34 Where other laws and regulations provide penalties for violations of these Regulations
    not provided in these Regulations, or provide more severe penalties
    than these Regulations, such laws and regulations shall control.


    Chapter VII
    Supplementary Provision

    Article 35 These Regulations shall come into force as of January 1, 2022.

     

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