GreRoyalt
Article 1 This Law is formulated for the purposes of promoting healthy development of the socialist market economy, encouraging and protecting fair competition, preventing unfair competition, and protecting the legitimate rights and interests of business operators and consumers.
Article 2 Business operators shall adhere to the principles of voluntary participation, equality, fairness and integrity in their production and business operation, and comply with laws and business ethics.
Unfair competition referred to in this Law shall mean the behavior of an operator who violates the provisions of this Law in its production and business operation, disrupts market competition order, or harms the legitimate rights and interests of other business operators or consumers.
Business operators referred to in this Law shall mean natural persons, legal persons and non-legal persons engaging in manufacturing and business operation of goods, or provision of services (the goods referred to hereinafter include services).
Article 3 All levels of People's Government shall adopt measures to prevent unfair competition, and create good environment and conditions for fair competition.
The State Council establishes an anti-unfair competition work coordination mechanism, study and decide on major anti-unfair competition policies, coordinate and handle major issues for protecting market competition order.
Article 4 The administration for industry and commerce of People's Governments of county level and above shall investigate and deal with unfair competition; where the laws and administrative regulations stipulate that other authorities shall investigate and handle, such provisions shall prevail.
Article 5 The State encourages, supports and protects organisations and individuals carrying out public supervision for unfair competition.
State agencies and their staff shall not support or cover up unfair competition.
Industry organisations shall strengthen industry self-governance, guide and standardise lawful competition among their members, and maintain market competition order.
Article 6 Business operators shall not commit the following acts to mislead others to misidentify their goods as others' goods or to associate their goods with others:
(1) unauthorised use of labels which are identical or similar to the description, packaging, decoration etc of other's goods that are influential;
(2) unauthorised use of other's influential enterprise name (including abbreviation, brand name etc), social organisation name (including abbreviation etc) and name (including pen name, stage name, translated name etc);
(3) unauthorised use of main part of other's domain name, website name, web page etc that are influential; or
(4) any other acts which can mislead others to misidentify their goods as others' goods or to associate their goods with others.
Article 7 Business operators shall not use monies and assets or other means to bribe the following organisations or individuals so as to seek transaction opportunities or competitive advantage:
(1) staff of a transaction counterparty;
(2) organisations or individuals entrusted by a transaction counterparty to handle the relevant matters; or
(3) organisations or individuals who make use of their official powers or influence to affect a transaction.
Business operators may, in their transaction activities, explicitly give discount to a transaction counterparty, or pay commission to a middleman. When giving discount to a transaction counterparty or paying commission to a middleman, the business operator shall record the discount or commission in its accounts truthfully. Business operators who receive discount or commission shall also record the discount or commission in their accounts truthfully.
Bribery committed by a staff member of a business operator shall be deemed as bribery committed by the business operator, except where the
business operator has evidence to prove that the conduct of the said staff member has nothing to do with seeking transaction opportunities or competitive advantage for business operator.
Article 8 Business operators shall not make false or misleading commercial promotion for the performance, functions, quality, sales, user evaluation, accolades etc so as to defraud or mislead consumers.
Business operators shall not organise false transactions etc to help other business operators to carry out false or misleading commercial promotion.
Article 9 Business operators shall not commit the following infringement of commercial secrets:
(1) obtain the commercial secrets of a rights holder through theft,
bribery, fraud, coercion, hacking or other improper means;
(2) disclose, use or allow others to use the commercial secrets of a rights holder obtained through the aforesaid means;
(3) violate confidentiality obligation or violate a rights holder's requirements on keeping confidentiality of commercial secrets, and disclose, use or allow others to use such commercial secrets they obtained; and
(4) instigate, induce or assist others to violate confidentiality obligation or to violate a rights holder's requirements on keeping confidentiality of commercial secrets, so as to disclose, use or allow others to use the commercial secrets of the rights holder.
Natural persons, legal persons and non-legal persons other than business operators committing any of the illegal acts stipulated in the preceding paragraph shall be deemed to have infringed upon commercial secrets.
Where a third party is knowingly aware or should be aware that an employee, ex-employee of a rights holder of commercial secrets, or any other organisation or individual, has committed any of the illegal acts stipulated in the first paragraph of this Article but still obtains, discloses, uses or allows others to use such commercial secrets, this shall be deemed to have infringed upon commercial secrets.
Commercial secrets referred to in this Law shall mean commercial information such as technical information and business information, which is not known to the public and has commercial value and for which the rights holder has adopted the corresponding confidentiality measures.
Article 10 Business operators conducting prize-giving sales shall not have the following circumstances:
(1) the information on types of prizes, redemption criteria, prize amount or prize items etc are unclear, thus affecting prize redemption;
(2) conducting prize-giving sales in a fraudulent way that falsely claims to have prizes or deliberately gives prizes to designated persons;
(3) the highest prize of a lucky draw in prize-giving sales exceeds RMB50,000.
Article 11 Business operators shall not fabricate or disseminate false information or misleading information to harm the business goodwill, product reputation of their competitors.
Article 12 Business operators making use of cyber network for their production and business activities shall comply with the provisions of this Law.
A business operator shall not make use of technical means to commit the following acts, through influencing users' choice or any other method, to hinder and disrupt normal operation of the cyber products or services provided legitimately by other business operators:
(1) without the consent of other business operators, insert hyperlink or force redirects in the cyber products or services provided legitimately by them;
(2) mislead, defraud or force users to amend, close or uninstall cyber products or services provided legitimately by other business operators;
(3) maliciously implement incompatibility with cyber products or services provided legitimately by other business operators; or
(4) commit any other acts which hinder or disrupt cyber products or services provided legitimately by other business operators.
Chapter 3 Investigation into Alleged Unfair Competition
Article 13 The regulatory authorities may adopt the following measures to investigate into alleged unfair competition:
(1) enter into the business premises where the alleged unfair competition is carried out, to conduct inspection;
(2) question the business operator under investigation, the stakeholders and other relevant organisations, individuals, and request them to provide the relevant explanation or provide other materials related to the activities under investigation;
(3) inspect or make copies of agreements, accounts books, invoices and receipts, documents, records, business correspondence and other materials related to the alleged unfair competition;
(4) seize or confiscate monies and assets related to the alleged unfair competition; and
(5) enquire into the bank account(s) of the business operator allegedly engaging in unfair competition.
For adoption of the measures stipulated in the preceding paragraph, a written report shall be submitted to the key person-in-charge of the regulatory authorities and obtain approval. For adoption of measures stipulated in item (4) and item (5) of the preceding paragraph, a written report shall be submitted to the key person-in-charge of the regulatory authorities of the People's Government of a municipality divided into districts and obtain approval.
In the investigation of alleged unfair competition, the regulatory authorities shall comply with the provisions of the Administrative Enforcement Law of the People's Republic of China and other related laws and administrative regulations, and promptly announce the investigation findings to the public.
Article 14 When the regulatory authorities investigate into an alleged unfair competition, the business operator under investigation and the stakeholders, as well as other relevant organisations and individuals, shall provide the relevant materials or information truthfully.
Article 15 The regulatory authorities and their staff shall keep confidentiality of commercial secrets which have come into their knowledge during the investigation.
Article 16 Any organisation or individual shall have the right to report an alleged unfair competition to the regulatory authorities; the regulatory authorities shall, upon receipt of a report, promptly handle pursuant to the law.
The regulatory authorities shall announce the hotline, mail address or email address for acceptance of reports from the public, and keep confidentiality for whistleblowers. Where a whistleblower makes a report in real name and provides the relevant facts and evidence, the regulatory authorities shall notify the whistleblower of the action taken.
Article 17 Business operators who violate the provisions of this Law and cause others to suffer damages shall bear civil liability pursuant to the law.
Where the legitimate rights and interests of a business operator are harmed by unfair competition,
the business operator may file a lawsuit with a People's Court.
The compensation for a business operator who suffer damages due to unfair competition shall be determined in accordance with the actual losses suffered as a result of the infringement; where it is hard to ascertain the actual losses, the compensation shall be determined in accordance with the gains made by the infringor from the infringement. For business operators who infringe upon commercial secrets maliciously and if the case is serious, the compensation amount may be determined in accordance with one to five times the amount determined using the aforesaid method. The compensation amount shall also include reasonable expenses paid by the business operator to stop the infringement.
Where a business operator violates the provisions of Article 6 and Article 9 of this Law, and it is hard to ascertain the actual losses suffered by the rights holder due to the infringement or to ascertain the gains made by the infringor from the infringement, the People's Court shall, in accordance with the extent of the infringement, award compensation of less than RMB5 million to the rights holder.
Article 18 Where a business operator violates the provisions of Article 6 of this Law in carrying out misleading activities, the regulatory authorities shall order the business operator to stop the illegal activities, and confiscate the illegal goods. Where the illegal business revenue is RMB50,000 or more, a fine of not more than five times the amount of illegal business revenue may also be imposed; where there is no illegal business revenue or the illegal business revenue is less than RMB50,000, a fine of not more than RMB250,000 may also be imposed. In serious cases, the business licence of the business operator shall be revoked.
Where the enterprise name registered by a business operator violates the provisions of Article 6 of this Law, the business operator shall promptly complete name change registration formalities; prior to the name change, the original enterprise registration authorities shall use the business operator's unified social code to replace its name.
Article 19 Where a business operator violates the provisions of Article 7 of this Law in committing bribery, the regulatory authorities shall confiscate the illegal income and impose a fine ranging from RMB100,000 to RMB3 million. In serious cases, the business licence of the business operator shall be revoked.
Article 20 Where a business operator violates the provisions of Article 8 of this Law in making false or misleading commercial promotion or organising false transactions etc to help another business operator to carry out false or misleading commercial promotion, the regulatory authorities shall order the business operator to stop the illegal act, and impose a fine ranging from RMB200,000 to RMB1 million; in serious cases, a fine ranging from RMB1 million to RMB2 million shall be imposed, and the business licence of the business operator may be revoked.
A business operator who violates the provisions of Article 8 of this Law in distributing false advertisements shall be punished pursuant to the Advertising Law of the People's Republic of China.
Article 21 Natural persons, legal persons and non-legal persons other than business operators who violate the provisions of Article 9 of this Law in infringing upon commercial secrets shall be ordered by the supervision and inspection department to stop the illegal act,
illegal income shall be confiscated and a fine ranging from RMB100,000 to RMB1 million shall be imposed; in serious cases, a fine ranging from RMB500,000 to RMB5 million shall be imposed.
Article 22 Where a business operator conducting prize-giving sales violates the provisions of Article 10 of this Law, the regulatory authorities shall order the business operator to stop the illegal act, and impose a fine ranging from RMB50,000 to RMB500,000.
Article 23 Where a business operator violates the provisions of Article 11 of this Law in harming the business goodwill or product reputation of its competitors, the regulatory authorities shall order the business operator to stop the illegal act, eliminate the impact, and pay a fine ranging from RMB100,000 to RMB500,000; in serious cases, a fine ranging from RMB500,000 to RMB3 million shall be imposed.
Article 24 Where a business operator violates the provisions of Article 12 of this Law in making use of technical means to commit the following acts through influencing user choice or any other method to hinder or disrupt normal operation of the cyber products or services provided legitimately by other business operators, the regulatory authorities shall order the business operator to stop the illegal act, and impose a fine ranging from RMB100,000 to RMB500,000; in serious cases, a fine ranging from RMB500,000 to RMB3 million shall be imposed.
Article 25 Where a business operator who engages in unfair competition and
violates the provisions of this Law takes the initiative to eliminate or mitigate the harmful consequences of the illegal act, the administrative punishment shall be reduced or mitigated pursuant to the law; where the illegal act is trivial and promptly corrected and does not cause harmful consequences, no administrative punishment shall be imposed.
Article 26 Where a business operator who engages in unfair competition and
violates the provisions of this Law is subject to administrative punishment, the regulatory authorities shall make a record in the creditworthiness records of the business operator, and make an announcement pursuant to the provisions of the relevant laws and administrative regulations.
Article 27 A business operator who violates the provisions of this Law shall bear civil liability, administrative liability and criminal liability; where its assets are insufficient to pay, it shall first bear the civil liability.
Article 28 Persons who obstruct performance of duties pursuant to this Law by the regulatory authorities and refuse or hinder investigation shall be ordered by the regulatory authorities to make correction, a fine of not more than RMB5,000 may be imposed on such an individual, a fine of not more than RMB50,000 may be imposed on such an organisation, and the public security bureau may impose security administration punishment pursuant to the law.
Article 29 A party concerned who disagrees with a decision made by the regulatory authorities may apply for administrative review or file an administrative lawsuit pursuant to the law.
Article 30 Staff of the regulatory authorities guilty of abusing official powers, dereliction of duties, practising favouritism or divulging commercial secrets which have come into their knowledge during the investigation shall be punished pursuant to the law.
Article 31 Where a violation of the provisions of this Law constitutes a criminal offence, criminal liability shall be pursued in accordance with the law.
Article 32 In the civil proceedings involving infringement of commercial secrets, where the rights holder of commercial secrets provides preliminary evidence to prove that it has adopted confidentiality measures for the asserted commercial secrets, and reasonably demonstrate that the commercial secrets are infringed upon, the alleged infringor shall prove that the commercial secrets asserted by the rights holder do not fall under commercial secrets stipulated in this Law.
Where the rights holder of commercial secrets provides preliminary evidence to demonstrate reasonably that the commercial secrets are infringed upon and provides any of the following evidence, the alleged infringor shall prove that there is no infringement of commercial secrets:
(1) there is evidence to prove that the alleged infringor has the means or opportunities to obtain the commercial secrets, and the information used by the alleged infringor is substantively identical to the commercial secrets;
(2) there is evidence to prove that the commercial secrets are disclosed or used by the alleged infringor, or there is a risk of disclosure or use of the commercial secrets; or
(3) there is other evidence to prove that the commercial secrets are infringed by the alleged infringor.
Chapter 5 Supplementary Provisions
Article 33 This Law shall be implemented with effect from 1 January 2018.
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