What are the main constraints for the effective enforcement of the Essay

What are the main constraints for the effective enforcement of the antimonopoly law in china - Essay Example Some businesses, whether private or state owned could monopolize the market activities, from which most small organizations and individual businesses felt strained, and could eventually close the businesses. Having the price of products and services dictated by a specific organization made them monopolize the markets and their shares, such that small and medium enterprises felt inferior, most of them operating under influence of bigger companies and with little as benefits. The Antimonopoly law began operating in early August 2008, making China a vital competition law jurisdiction, for international and domestic businesses, or companies with running activities in China’s territory. Its three broad rules are based on prohibiting abuse of dominant market positions and restrictive agreements, mergers rules preventing mergers or joint ventures that restrict competition as well as control M&A activities, and rules forbidding abuse of administrative powers that end up in competition restriction. The application of the law is viewed differently among the people of China. Some think it applies to all businesses or organizations in dealings of providing goods and services, while others think the complexity of the law has something to enhance leniency in state owned enterprises. However, even after its initiation, several factors have dominated to restrict full enforcement of the law. They include limited transparency, concentration, influence from government involvement, outdated economic planning, unreliable market infrastructure, unnecessary enforcement of law, insider control, and general resistance. So far, the Anti Monopoly Law (AML) is being enforced by three bodies; MOFCOM, NDRC and SAIC, to ensure fair competition, safeguard social public and consumer interest, boost economic efficiency, and restrain monopolistic behavior. The enforcement agencies continue to experience challenges and problems in the law enforcement practice, limiting effective applicatio n and acceptance of the AML by the people. 1. Limited Transparency Over the years, the enforcement agencies have been handling many cases to do with monopolistic agreements, merger control, and price and non price related cases for the companies and businesses operating and showing interest to practice within China. The NDRC and SAIC have faced accusations of hiding investigation results, but MOFCOM has so far been transparent. NDRC and SAIC, which are regulators of anti monopoly law of China have limited transparency to a certain level, raising the need for confidentiality of certain information, with respect to the companies after investigation. For example, the TravelSky, which is a state owned company, was alleged to change its discount policies back in 2009, influencing other airlines in its network to raise airfares that resulted in country wide complaints The NDRC was the enforcement agency responsible for conducting investigations in the case, but the consumers of the airlin e service and the public never got to hear the results of the investigation (Wang, 2011). The controversial issue remains as to why some investigation results of certain companies are disclosed, while those of others never get to be released to the public. Again, most of the cases brought forward are convictions of private enterprises, in areas of cartels and abuse of dominance. Does it mean that the law breakers are private organizations and businesses? Surely, the state owned enterprises (SOE) are no exception, but too many issues to do with them are being ignored, or leniency is being applied to them as a favor. The structure of