The Regulation Of Mergers By Competition Law

Antitrust law, began in American, was called"economic constitution"by American jurists. So we can see its protection effect to the order of market economy. Merger behaviors of firms have been one of the three main regulation scopes as they can increase the market concentration and may restrict the competition.The investigation to the mergers ordinarily relies on the economic analysis, so the analysis to the mergers bases on the theory of economics either in American antitrust law or in EU competition law. There are mainly three steps. The first step is the definition of relative market of related firms. It mainly bases on the price theory and the theory of demand elasticity. And then, the market share of related firms and the market concentration will be investigated with the relative market as basis in order to decide whether the merger may restrict competition or not. If the result is that the merger may have restrictive effect to the competition of relative market, the further analysis need to be done. In this step, it mainly weighs which effect is more between the positive and negative effects of the merger. As a result, the practicing authority of antitrust law makes a decision that whether the merger should be prohibited. Yet, the analyses of economics are certainly the main tools in the course of first step investigation and further analysis.China has not drawn up the"Antitrust Law", and there is only a transitional administration code—Provisions for Foreign Investors to Merge Domestic Enterprises by Ministry of commerce of PRC. So the study of regulation system to the merger of firms is just academic theory. Our scholars of antitrust law pay much attention to this domain, but, so far the study points still remain on introducing the definition, styles, legal requirements and the procedures of the investigation to mergers, too less attention are paid to the most important aspect, the substantial rules for the investigation of mergers. With the acceleration of the legislation course of Antitrust Law, the study to the substantial rules seems to be more necessary. The author studies on the substantial rules of regulation to mergers under the background, and gives some suggests to the draft of Antitrust Law discussed once by the NPC Standing Committee.