A Legal Study on the Fair Competition of State-owned Capital Investment Policy in China

On June 14, 2016, the State Council of China issued the Opinions on the Establishment of a Fair Competition Review System in the Construction of the Market System. This document holds landmark significance for fostering a fair and competitive market environment while ensuring that the market plays a decisive role in resource allocation. Subsequently, on October 23, 2017, the National Development and Reform Commission, along with five other departments, jointly released the Implementing Rules for the Fair Competition Review System (Provisional). This was followed by further developments leading to the issuance of comprehensive Implementing Rules for the Fair Competition Review System on July 8, 2021. These rules aimed to refine and enhance various aspects of the fair competition review system.Most recently, on June 6, 2024, China's State Council promulgated regulations titled Regulations on Fair Competition Review, presented as an administrative regulation. This initiative further clarified both the legal framework and implementation mechanisms associated with fair competition reviews. The successive introduction of these policies underscores their critical importance and necessity in promoting effective fair competition review practices. China's state-owned capital investment policy plays a significant role in the allocation of social resources. However, if it does not adhere to market principles, it may lead to various anti-competitive harms. Given the unique characteristics of the state-owned capital investment policy, establishing a legal framework for fair competition review is particularly crucial. This paper draws on China's distinctive legal system and national conditions while incorporating advanced international experiences in competition review. It advocates for comprehensive improvements through legislative enhancement, administrative oversight, and judicial protection to ensure that the fair competition review system effectively constrains state-owned capital investment policies. The initiative not only facilitates the optimization of state-owned capital resource allocation and enhances the socialist market economic system with Chinese characteristics, but also addresses the concerns of the international community regarding China's state-owned capital policies. Furthermore, it offers a Chinese initiative for global governance of state-owned capital.