In the annals of anti-monopoly case law, Chinese rice noodle and tableware cartels do not rank up there with the Standard Oil trust, the petroleum cartel that was famously prosecuted in 1911 under the US Sherman Antitrust Act.
But in time these two much lesser known cartels, targeted by Beijing regulators shortly after the implementation of China’s 2010 Anti-Monopoly Law, may become famous in their own right. They were among the first cases in an enforcement campaign that has since ensnared the likes of Mercedes-Benz and Qualcomm. It could also soon have implications for multinationals’ ability to safeguard intellectual property in the world’s most coveted market.
In both instances, the National Development and Reform Commission imposed small penalties for price collusion on more than a dozen rice noodle makers and service providers that wash, sterilise and wrap tableware in plastic for restaurants. Stephen Harris, a competition attorney with Winston & Strawn in Washington DC, says both cases were a signal to Chinese companies by NDRC that “new laws exist and there’s a cop on the beat”.