Competition Policy under Economic Recessions: Historical Changes and Implications
China - 31 January 2013
Before the current financial crisis, economic recessions in history were always accompanied by relaxation or abandon of competition policy. However, in the current financial crisis, although different jurisdictions have different practices, most jurisdictions have kept the bottom line of competition policy enforcement. Such historical transformation roots in deep reflections on historical failures and the popularization of competition policy as well as the strengthening of the competition authorities. China is one of the few countries still weakening competition policy enforcement during the current financial crisis. In fact, there are several mechanisms contained in competition laws and policies, such as the exemption of cartels, the defense of business concentrations and the coordination between competition authorities and sector regulators, which provide some space of flexible competition policy enforcement during economic recessions. Considering China’s short history of competition policy enforcement and consistent tradition of government intervention in economy, it is strongly advised to hold on the bottom line of competition policy and pay more attention to government-led anti-competitive conducts during economic recessions.