The telecommunications sector could be one of the next targets of Chinese anti-trust regulators

China price regulator eyeing telecoms and petroleum

China's powerful anti-trust regulator could target the petroleum, telecommunications, banking and auto sectors next.

The National Development and Reform Commission (NDRC) would look at industries that have an impact on the lives of ordinary Chinese, China Central Television (CCTV) quoted Xu Kunlin, head of the anti-monopoly bureau at the NDRC, as saying on one of its programmes.

The NDRC has launched nearly 20 pricing-related probes into domestic and foreign firms in the last three years, according to official media reports and research published by law firms.

But the scope of its investigations in the world's second biggest economy have gathered pace in recent months and coincide with criticism in official media about the price of goods such as milk powder, medicine, luxury cars and jewellery.

The China Automobile Dealers Association said earlier this week that its officials were collecting data on the price of all foreign cars sold in the country for the NDRC.

"When you look at activities around the world, regulators tend to investigate sectors where their investigations can have a direct impact on consumers, and that will look good," said Sebastien Evrard, Beijing-based partner at law firm Jones Day, which specialises in anti-trust law.

Companies in the petroleum, telecommunications, banking and auto sectors were on the NDRC's radar for future investigations, CCTV's official blog quoted Xu as saying.

Xu gave a hypothetical example, saying that if banks fixed deposit or lending rates if and when China liberalised its interest rate regime, such behaviour could prompt an investigation. CCTV gave no other details and NDRC officials could not be reached for comment.

But Evrard said that while telecoms companies and fuel prices were often the target of regulators around the world, they would not be obvious choices in China because of the involvement of state-owned companies.

The country's three biggest telecom firms – China Unicom, China Mobile and China Telecom Corp – are state owned. Similarly, the top four banks are controlled by the state and the price of oil in China is set by the government.

Last week the NDRC fined six milk powder firms for anti-competitive behaviour. It is also investigating 60 foreign and local pharmaceutical companies over pricing and costs.

Foreign executives and bankers in China say the various investigations are a hot topic of discussion but many are still puzzled by the motivation behind the probes and whether they will impact their business.

Recent articles

Info Message

Our sites use cookies to support some functionality, and to collect anonymous user data.

Learn more about IET cookies and how to control them

Close