Abuse of Dominance: New Developments in the Tetra Pak Decision

• Citation: jd0246
• Published date: 23 November 2016
• Date: 23 November 2016
• Subject Matter: Economic Law

2021/1/28 KWM | Abuse of Dominance: New Developments in the Tetra Pak Decision

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Abuse of Dominance: New Developments in the Tetra Pak Decision

This article was written by Susan Ning (partner), Kate Peng (partner), Gao Sibo

(associate) and Zhang Kai (assistant associate).

On 16 November 2016, the State Administration for Industry and Commerce of the

People's Republic of China (“SAIC”) published its administrative penalty decision to

fine Tetra Pak (“TP”) for abuse of dominant market position. The SAIC imposed a

fine totaling RMB 667.7 million bringing an end to a case that started in January

2012 and lasted for almost five years.

The SAIC found that from 2009 to 2013, TP abused its dominant position in aseptic

carton packaging machinery for liquid food products (“machinery market”), technical

services for aseptic carton packaging machinery for liquid food products (“technical

service market”), and cartons for liquid food product aseptic packaging (“carton

market”). The SAIC found that in Mainland China TP had without justifiable reasons

conducted tie-in sales, exclusive dealing and loyalty discounts.

In this case the SAIC for the first time defined a “loyalty discount” as an “other forms

of abuse of dominant market position confirmed as such by the Anti-Monopoly

Enforcement Authority under the State Council” regulated under Article 17(1) (vii) of

the Anti-Monopoly Law (the “AML”). By doing so, the theory of loyalty discounting

(already widely acknowledged in the EU and the US) has been adopted as the

seventh approach to regulate abusive conduct. This decision has great practical

significance, and also brings new challenges and requirements to companies’

compliance mechanisms.

In this article, we will review the case and the important legal issues it raises.

I. Addressees of the Decision

23 November 2016

Abuse of Dominance: New

Developments in the Tetra

Pak Decision