China: Adopted Provisions on Intellectual Property Rights Excluding and Restricting Competition

On 25 June 2023, the State Administration for Market Regulation (SAMR) adopted Provisions on Intellectual Property Rights Excluding and Restricting Competition. The Provisions update present regulations on the use of intellectual property rights in anticompetitive agreements in accordance with the recently amended Anti-Monopoly Law. They prohibit the use of intellectual property rights to restrict competition or abuse a dominant position. A violation of the Regulations resulting from monopoly agreements can result in a fine amounting to a minimum of 1% of the sales from the previous year. Similarly, a violation arising from the abuse of a dominant market position can lead to a fine of at least 1% of the previous year's sales but not exceeding CNY 10 million. A breach occurring due to mergers may incur a fine of up to 10% of the previous year's sales, with the upper limit being CNY 5 million. The order comes into force on 1 August 2023.