15 Nov, 2011

The price supervision and anti-monopoly bureau at the National Development and Reform Commission announced earlier in the month that it was launching an investigation into China Telecom and China Unicom, after they were accused of abusing their position in the market to isolate potential competitors from the broadband business, according to the Financial Times.

Gerry O’Brien, consultant at Hong Kong law firm, Mayer Brown, said: “It can be seen as a message to the world that this part of the anti-monopoly law is now open,” according to the FT, as some commentators are of the opinion that this type of investigation could occur in other sectors.

Mr O’Brien continued: “In the past, vigorous enforcement of the law has largely been confined to merger control and cartels, but now regulator-led cases about abuse of dominance may increasingly come into focus.”

The two accused companies, if found guilty, face the possibility of hefty fines of up to 10% of their broadband revenues from last year (2010).

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