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    China unveils system for filing antitrust reviews in sign of ‘normalised’ regulations in tech industry


    Iris Deng Published: 7:30pm, 2 Aug, 2022

    China’s antitrust watchdog said it has standardised and streamlined the process for companies to report their merger and acquisition deals, days after the country’s top leadership vowed to approve technology-related investment deals in a sign of easing restrictions.

    The State Administration for Market Regulation (SAMR) launched on Monday the “Concentration of Undertakings Antimonopoly System”, an online platform for firms to disclose merger and acquisition deals to the regulator and check their approval statuses. From next month, the new system will replace the previous submission method of email.

    The SAMR, which was granted the authority to conduct antitrust reviews during a government reshuffle in 2019, has imposed dozens of fines since late 2020 against China’s Big Tech companies, including Tencent Holdings and Alibaba Group Holding, over their failures to disclose deals from as early as a decade ago.

    However, even as authorities handed out the fines, there had been no standard bureaucratic procedure for companies to file their deals for review.

    The new system, based on relevant anti-monopoly laws and regulations, is designed to provide timely feedback and legal documents to the reporting companies, to enhance convenience and transparency, the SAMR said.

    According to antitrust guidelines updated in 2018, companies needed to seek approval for mergers or acquisitions involving firms with annual revenues of more than 10 billion yuan (US$1.48 billion) globally, or 2 billion yuan in China. Companies that failed to disclose and seek approvals were subject to a fine of up to 500,000 yuan for each case.

    Companies punished later this year face larger fines. The updated Anti-Monopoly Law, which came into effect on Monday, increases the maximum fine for undeclared merger deals to 5 million yuan.

    However, there are signs that China is moving to “normalise” its regulatory efforts targeting the country’s tech sector following a crackdown that started in late 2020, ostensibly to curb the “irrational expansion of capital”.

    In April, Beijing indicated that it wanted China’s internet firms to play a more important role in helping to bolster the faltering national economy, battered by massive lockdowns and other stringent Covid-19-related measures.

    Last week the Chinese government established an interministerial meeting mechanism focused on the country’s digital economy, a small step towards aligning different regulators in supervising Big Tech companies.

    During a Politburo meeting chaired by President Xi Jinping on Thursday, China’s top leaders said they would give “the green light” to a number of pending tech investment deals, sending a policy signal that Beijing is ready to encourage certain financing pacts involving tech giants.