The Amendment of the Anti-Unfair Competition Law of the People’s Republic of China

New definition on commercial bribery

On 14 November 2017, the Standing Committee of the National People’s Congress of the People’s Republic of China (“PRC”) promulgated amendments to the “Anti-Unfair Competition Law of the People’s Republic of China” (the “amended AUCL”), which will come into effect on 1 January 2018. The amended AUCL came 24 years after the current AUCL has been implemented.

The amended AUCL made a number of substantial changes mainly in the areas of unfair competition, investigations into suspected unfair competition, and the legal liabilities arising from unfair competition. One of the most important amendment is the redefinition of commercial bribery which had been a longstanding controversy and poses a challenge to every company operating in the PRC.

We believe that this is the first time the government makes clear its intention to create a fair competitive business environment by clarifying the historical inconsistent interpretations of commercial bribery. Though some of the amended provisions remain vague, the implementation of this ground-breaking legislation will be watched with keen interest . In this alert, we consider the potential impact brought by the significant changes to the concept of commercial bribery.

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