The Anti-Unfair Competition Law was enacted in 1993 and amended twice respectively in 2017 and in 2019. The latest revision entered into force on April 23, 2019.

There are 33 articles in total.

The key points are as follows:

1.Unfair competition refers to the acts of operators which disrupt the market order, and prejudice the legitimate rights and interests of other operators or consumers during the process of their production and operation. (Article 2)

2.What are the types of unfair competition?

(1) Confusion, which refers to the confusing act of the operator that leads the public to mistaken the operator’s commodity for the specific commodity of other people, or mistakenly to believe that the operator has a specific connection with other people. (Article 6)

(2) Bribery, which refers to the act of the operator who bribes the counterparty of a transaction or other related parties to seek transaction opportunities or competitive advantages. (Article 7)

(3) False advertising, which refers to the act of the operator who makes an unfair or untrue statement about their products or services, and thus misleads the consumers. (Article 8)

(4) Trade secret infringement, which refers to the act of the operator who illegally obtains, uses and discloses the trade secrets of others. (Article 9)

(5) False prize-attached sale, which refers to the act of the operator who conducts the sales promotion with prizes in a fraudulent way, or with a top prize of the lottery sale exceeding CNY 50,000. (Article 10)

(6) Defamation, which refers to the act of the operator who fabricates or disseminates false information to damage the goodwill of a competitor. (Article 11)

(7) Unfair competition on the Internet, which refers to the act of the operator who destroys or interferes with competitors’ cyber products by technological means. (Article 12)

3.The Market Regulation Bureau at each level is responsible for investigating and imposing sanctions on the operators who commit acts of unfair competition. Those whose rights have been violated can also file a lawsuit against such operators. (Article 4)

4.The government may go to the operator’s office to investigate, inquire about relevant personnel, check the operator’s documents, seize its property and inquire about its bank account(s). (Article 13)

5.The right holder may bring a lawsuit against the operator (infringer) who has committed acts of unfair competition, and demand damages for the losses.

If it is difficult to determine the actual losses, the court can determine the damages payable by the infringer based on a reasonable multiple of the gains acquired by the infringer arising from the infringement, i.e. 1- 5 times, which was 1-3 times before; if such gains acquired by the infringer are also difficult to determine, the damages can be determined at the discretion of the court within the upper limit of CNY 5 million, which was CNY 3 million before. (Article 17)

6.The government may ask the infringer to stop acts of unfair competition, impose fines or even revoke the business license of the infringer. (Article 18)

7.If the act of the infringer constitutes a crime, it may be subject to criminal prosecutions. (Article 31)