Interim Measures for Investigating and Handling Failure to Legally Declare the Concentration of Business Operators

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· Document Number:Order No. 6 [2011] of the Ministry of Commerce

· Area of Law: Anti-Unfair Competition

· Level of Authority: Departmental Rules

· Date issued:12-30-2011

· Effective Date:02-01-2012

· Issuing Authority: Ministry of Commerce

· Status: Effective

 

Order of the Ministry of Commerce

 

(No. 6 [2011])

 

The Interim Measures for Investigating and Handling Failure to Legally Declare the Concentration of Business Operators were adopted at 57th executive meeting of the Ministry of Commerce on December 7, 2011, are hereby promulgated and shall come into force on January 1, 2012.

 

Minister Chen Deming

 

Decemer 30,2011

Interim Measures for Investigating and Handling Failure to Legally Declare the Concentration of Business Operators
Article 1 To regulate the investigation and handling of the failure to legally declare the concentration of business operators that has reached the standards for declaration, these Measures are formulated in accordance with the relevant provisions of the Anti-Monopoly Law of the People's Republic of China (hereinafter the “Anti-Monopoly Law”) and the Provisions of the State Council on the Standards for the Declaration of Concentration of Business Operators (hereinafter referred to as the “Provisions”).
Article 2 The term “failure to legally declare the concentration of business operators” as mentioned in these Measures means that the concentration of business operators has reached the standards for declaration as prescribed in the Provisions but the business operators have implemented such concentration without prior declaration to the Ministry of Commerce in accordance with the Anti-Monopoly Law.
The Measures for Calculating the Turnover for the Declaration of Concentration of Business Operators in the Financial Industry shall apply to the calculation of turnover of banking financial institutions, securities companies, futures companies, fund management companies and insurance companies.
Article 3 The Ministry of Commerce shall be responsible for the investigation and handling of the failure to legally declare the concentration of business operators.
The Ministry of Commerce may, as necessitated by work, entrust the provincial commerce department to assist in the investigation of a failure to legally declare the concentration of business operators within the local region.
Article 4 All entities and individuals shall have the right to report to the Ministry of Commerce a suspected failure to legally declare the concentration of business operators. The Ministry of Commerce shall keep the informant confidential.
The Ministry of Commerce shall conduct necessary verifications where a report is made in writing and includes the basic information on the informant and the suspect as well as the relevant facts and evidence on the suspected failure to legally declare the concentration of business operators.
The Ministry of Commerce may conduct necessary verifications on the relevant facts and evidence, obtained through other channels, regarding the suspected failure to legally declare the concentration of business operators.
Article 5 Where there is any preliminary fact or evidence showing the suspected failure to legally declare the concentration of business operators, the Ministry of Commerce shall file the case and notify the business operators under investigation in writing.
The term “business operators under investigation” as mentioned in these Measures means the “declaration obligor” as prescribed in Article 9 of the Measures for the Declaration of Concentration of Business Operators.
Article 6 Business operators under investigation shall, within 30 days after being served upon the case filing notice, submit to the Ministry of Commerce the relevant documents and materials regarding whether the investigated transactions fall under the circumstances of concentration of business operators, whether the declaration standards are reached, and whether concentration has been implemented without declaration.
Article 7 The Ministry of Commerce shall, within 60 days after receiving the documents and materials submitted by the business operators under investigation according to Article 6 of these Measures, complete the preliminary investigation on whether the investigated transactions fall under the circumstances of the failure to legally declare the concentration of business operators.
Where business operators fall under the circumstances of the failure to legally declare the concentration of business operators, the Ministry of Commerce shall conduct further investigation, and notify the business operators under investigation of such a decision in writing. The business operators shall suspend implementation of concentration.
Where business operators do not fall under the circumstances of the failure to legally declare the concentration of business operators, the Ministry of Commerce shall decide not to conduct further investigation, and notify the business operators under investigation of such a decision in writing.
Article 8 Where the Ministry of Commerce decides to conduct further investigation, business operators under investigation shall, within 30 days after receiving the written notice from the Ministry of Commerce, submit the relevant documents and materials to the Ministry of Commerce in accordance with the Measures for the Declaration of Concentration of Business Operators.
The Ministry of Commerce shall complete further investigation within 180 days of receiving the documents and materials that are submitted by business operators under investigation and that meet the provisions of the preceding paragraph.
At the stage of further investigation, the Ministry of Commerce shall, in accordance with the relevant provisions of the Anti-Monopoly Law and the Measures for the Examination of Concentration of Business Operators, appraise whether the investigated transactions have or may have the effect of eliminating or restricting competition.
Article 9 When conducting investigations, the Ministry of Commerce may take the measures prescribed in Article 39 of the Anti-monopoly Law.
Article 10 The Ministry of Commerce shall assign at least two officials to investigate the failure to legally declare the concentration of business operators, and such officials shall present their legal certificates.
When the aforementioned officials conduct an inquiry or investigation, they shall make written transcripts regarding the inquiry and investigation and have the person under inquiry or investigation sign the transcripts.
Article 11 During the course of investigation, the business operators and interested parties under investigation shall have the right to state their own opinions. The Ministry of Commerce shall verify the facts, reasons and evidence presented by business operators and interested parties under investigation.
Article 12 The business operators or interested parties under investigation, or any other relevant entities or individuals, shall assist the Ministry of Commerce in legally performing its functions and shall not refuse or obstruct the investigation conducted by the Ministry of Commerce.
Article 13 Where, upon investigation, it is found that the business operators under investigation implemented concentration without legal declaration, the Ministry of Commerce may impose a fine of not more than 500,000 yuan on the business operators under investigation and order them to take the following measures so as to restore the state existing before concentration:
1. halt the implementation of concentration;
2. dispose shares or assets within the prescribed time limit;
3. transfer the business within the prescribed time limit; or
4. take other necessary measures.
When the Ministry of Commerce conducts handling according to the preceding paragraph, it shall consider factors such as the nature, extent and duration of the failure to legally declare the concentration of business operators, the appraisal result on the impact on competition made according to paragraph 3 of Article 8 of these Measures and other factors.
Article 14 The Ministry of Commerce shall, before making a handling decision according to Article 13 of these Measures, notify the business operators under investigation of the investigation conclusion and the facts and evidence on which the decision is based.
The business operators under investigation shall put forward written opinions within the time limit prescribed by the Ministry of Commerce. The written opinions shall include the relevant facts and evidence.
Article 15 The Ministry of Commerce shall notify the business operators under investigation of the written handling decision it makes according to Article 13 of these Measures. The handling decision on the failure to legally declare the concentration of business operators may be announced to the public.
Article 16 For an investigation conducted by the Ministry of Commerce according to law, if the business operators under investigation refuse to submit relevant materials or information, provide any false information, conceal, destroy or transfer evidence, or refuse or obstruct the investigation in any other form, such business operators shall be punished by the Ministry of Commerce according to Article 52 of the Anti-monopoly Law.
Article 17 The written documents which shall be served on the business operators under investigation may be served in the forms as prescribed in the relevant provisions of the Civil Procedure Law of the People's Republic of China.
Where the Ministry of Commerce serves the documents by announcement, it shall announce the documents that shall be served on its official website.
Article 18 Business operators may, according to law, first apply for administrative reconsideration if they refuse to accept the decision issued by the Ministry of Commerce according to these Measures; and the business operators may, according to law, file an administrative lawsuit if they refuse to accept the administrative reconsideration decision.
Article 19 The Ministry of Commerce, the business operators under investigation and other entities and individuals shall keep confidential the trade secrets and other information of confidential nature which they have access to in the course of an investigation, unless the information should be disclosed according to the provisions of laws and regulations or consent is obtained in advance from the holder of trade secret rights.
Article 20 Where any official of the Ministry of Commerce abuses power, neglects duty, practices favoritism, fraud, or discloses any trade secret to which he or she has access to in the course of law enforcement, if a crime is constituted, the official shall be subject to criminal liability according to law; or if no crime is constituted, the official shall be subject to disciplinary actions according to law.
Article 21 These Measures shall come into force on February 1, 2012.