Regulation On Standard Contracts Of Public Utilities

The market structure of pulic utilities, for their nature of natural monopoly, is monopolistic. How to avoid public utilities to abuse their monopolistic power while maintaining the monopolistic structure of public utilities has always been a problem. Standard contract, born against the background of social mass production, satisfies public utilities` need of convenience and efficiency and also the their need of utilizing their monopolistic power. Stand contract has been public utilities` favorite instrument of abusing monopolistic power to achieve unjust interests. Public utilities` drafting and application of unjust standard contract has constituted a serious economic and social problem in our country. This article, based on analysis of current monopolistic situation and relationship between public utilities and standard contract, poses some advices on the regulation of standard contract of public utilities. This article has three parts, namely preface, text and conclusion. The text is composed of 3 chapters. The first chapter focuses on the current monopolistic situation of Chinese public utilities. This chapter has three sections. The first section defines public utility and explain the natural monopolistic nature of public utilities. The predominant status of public utilities is determined by its nature, and is legitimate. However, the abuse of such status will incur damage to consumers and other market participant, and break market mechanism of fair competition. The second section focuses on the monopolistic situation of public utilities in our country. After analysis of the market structure and behavior of Chinese public utilities, the conclusion was drawn that the market structure of our public utilities is monopolistic and the abuse of predominant status is extensive. The third section discusses the weak mechanism of curbing the abuse of monopolistic power by public utilities. The discussion of this chapter indicates the rampage of abuse of monopolistic power of public utilities and the appeal for the emergence of new mechanisms to curb it. The second chapter focuses on the relationship between standard contract and public utilities. This chapter has three sections. The first section defines standard contract and analyzes the legal characteristics of standard contract. The second section discusses the prevalence of standard contract in public utilities, and indicates standard contract accords with the need of efficiency of social mass production and also the monopolistic status of public utilities, and therefore is used widely in public utilities. The third section analyzes the relationship between regulation on standard contract and on abuse of monopolistic power, and indicates contract is the vehicle of transaction, and most of public utilities` abuse of monopolistic power occur through standard contract. Regulation on standard contract would be helpful to the regulation on abuse of monopolistic power of public utilities. The third chapter poses advices on regulation of public utilities` standard contract. This chapter has four sections. The first section discusses the principle of regulation on standard contract. Contract freedom has been toppled down in the field of standard contract, and unrestricted contract freedom has caused many social and economic problems. Many countries has chosen to restrict and intervene in contract freedom. And restriction over contract freedom has been a tendency since the 20th century. The second section discusses participants in the regulation on standard contract, suggesting a comprehensive supervising system involving administrative department, judicial department, non-governmental organizations, market participants and medias. The third section discusses how to recognize a standard contract. The fourth section focuses on contents of regulation of standard contract, and poses some advices on how to perfect the regulatory system of standard contract from the perspectives of conditions for a standard term to be a part of the contract, explanation of standard contract and the executive power of standard contract.