context: Since the 2024 Third Plenum, the CPC has worked to create a 'high-level' socialist market economy, refining resource allocation while addressing market failures. The party aims to boost strategic planning and regional teamwork, building a unified domestic market for internal circulation. Central to this push is tackling local protectionism and monopoly. There is a need to ensure equal market access and protection for all participants while stopping administrative power misuse.
Market regulatory departments ought to grasp the significance of advancing an environment for fair competition, taking steps to build a unified national market, notes Luo Wen 罗文 State Administration of Market Regulation Party secretary and director.
Upholding fairness in market competition helps to eliminate ineffective enterprises, protecting the room for SME development and public interest. In recent years, market regulators have refined relevant legal grounds, creating a system with
- the core of two laws: Anti-Monopoly Law and Anti-unfair Competition Law
- two supporting administrative regulations
- 12 departmental charters
To enhance operationalisability and the expected effects of such laws, there is a need to
- refine regulations against inappropriate state interference
- strengthen hard constraints on administrative power
- tightly regulate decisions on developing hidden entry barriers
- clarify supporting measures on anti-monopoly
- refine anti-monopoly guidance system: heighten preemptive capabilities
- create an adjudication standard for law enforcement against inappropriate competition
- refine rules on digital economic competition
- hasten the third amendment on Anti-unfair Competition Law
- provide relevant standards for regulating online competition
- better bridge the PRC’s system with global norms
Another approach is to vet administrative decisions or policies that hamper fair competition. In 2024, market regulators reviewed over 19.6k major policy documents, with fair competition violations discovered in 2.1 percent of the paperwork, marking a 2.7 percent annual decline.
Overall, regional review work remains unbalanced, especially in areas of market entry and access, industrial development, government procurement, bidding and setting standards. To improve the situation, there is a need to
- sternly implement the regulations on fair competition review
- promote joint policy review on governments above the county level
- incorporate policy review into assessments for building a rules-based government
- improve the quality of the review process
- roll out the ‘Implementation measures of the regulations on fair competition review’
- delineate clear scopes and exceptions for review
- develop an equal competition system and database
These measures help to curb local protectionism, removing hidden market barriers such as credit ratings, local standards and differentiated standards across the country.
To cultivate a healthy market environment, ‘involution’ ought to be tackled. As the external environment shifts, there is a need to guarantee the stability of the PRC’s domestic supply chain.