[ad_1]
On December 11, the Political Bureau of the CPC Central Committee held a meeting to analyze and study the economic work in 2021. The meeting noted that China’s economic functioning is gradually returning to normal, but there are still many uncertainties in the new corona pneumonia epidemic and the external environment. Regarding the key tasks in 2021, the Politburo meeting revealed a series of contents including strengthening antitrust and preventing the disorderly expansion of capital.
It is worth noting that the Politburo meeting clearly stated for the first time that it is necessary to strengthen antitrust and prevent the disorderly expansion of capital. This sets the focus for supervisory work in the economic field for some time to come.
In fact, recent political signals on antitrust are very clear.
Earlier this year, the State Administration for Market Regulation announced the Revised Draft of the “Antitrust Law” (Draft for public comment). On November 10, the State Administration for Market Regulation publicly solicited opinions on the “Guidelines for Antitrust in the Field of Platform Economics (Draft for Comments).” According to the draft opinion, the platform requires merchants to “choose one of two,” “killing” consumers with big data, and to use rules, algorithms, technology, traffic distribution, and so on. to refuse to transact without just cause, etc., everyone can identify themselves as There is a monopoly.
Clearly, the work to strengthen antitrust is progressing steadily. Why Are Antitrust Laws Increasingly Important?
Looking back at China’s antitrust legislation, it started in 2008. Over the past 10 years, China’s social and economic changes have been reversed. One of the characteristics is that with the development of the digital economy, the role of the Internet platform has become more and more prominent.
Relying on technology and innovation, Internet platform transactions have rapidly formed a scale, providing users with a large number of products and services, which is a business model with great potential.
However, as Internet platform companies continue to grow, the industry worries that these new giants will become monopoly “monsters”, damaging the interests of ordinary people and small and medium-sized businesses, and creating new risks due to its disorderly expansion.
Recently, topics such as the acquisition of unicorns by internet giants, the platform’s “pick one” approach, and buying competition from community groups have attracted viewers and controversy. Essentially, the above concerns are revealed.
Judging from the experience of global business history, this concern is not far-fetched. Large companies with multiple advantages, such as capital, use subsidies to throw money and defeat their opponents, or pay for acquisitions to make their opponents invisible. There are countless similar cases. Thus, the Internet economy is more likely to form a “strong always stay strong” and “winner takes all” situation.
The pattern of monopoly has changed and, of course, antitrust measures must adapt with the times.
After careful examination, it is not difficult to find that the old regulatory system can no longer adapt to the new pattern.
For example, in the past, prices were generally used to judge whether a monopoly existed. But as we all know, most of the services provided by Internet platform companies today are free services and it is difficult to use price as a monopoly standard.
Another example is the market definition. In the Antitrust Law, the relevant market for the monopoly is defined as the range of basic products or the geographic scope in which the operators compete, but the nature of the Internet platform determines that the market has bilateral or multilateral characteristics. Under the premise that the relevant market cannot be defined, it is not easy to determine whether a company has a dominant position in the market. How to judge if it abuses its dominant position and a monopoly is suspected?
Antitrust must start with amendments to the law and take a multi-pronged approach to curb the unfair enrichment of Internet platforms. However, in view of the important value of the Internet platform for economic recovery, attention should be paid to two points at the same time as antitrust efforts are strengthened.
Economic development will inevitably lead to giants, but not all Internet giants are scourges.
What should be clear is that gradual growth and consequently a dominant position in the market is often a sign of a company’s ability, which is not wrong in itself, but the company abuses this position to obtain improper benefits. Therefore, strengthening antitrust requires additional refinement.
