Legal Analysis Of Coca-cola Merges Huiyuan Fruit Juice

According to the Anti-Monopoly Law, the Ministry of Commerce made a final decision on the case of Coca Cola's acquisition of Huiyuan Juice, and affirmed that the concentration would have a negative impact on competition. Thus, the concentration was prohibited and three rejection reasons were proposed. It became the first abortive case since the implementation of the Anti-Monopoly Law in August 1st, 2008 and caused strong repercussions home and abroad.During the process of reviewing the merger, adopting the analytic method of product-function substitution, the Ministry of Commerce defined the relevant product market as the fruit juice market, the relevant geographic market as the mainland of China. Although the author has some doubts on the method adopted by the Ministry, the conclusion is fundamentally rational. Actually, among the three rejection reasons presented in the Notice No.22 of the Ministry of Commerce, there are "two conduction effects" and "one squeeze effect"-a conduction of market dominant position from carbonated drinks to juice drinks market and a conduction from Coca-cola's brand, which will eliminate or restrain the competition of the existing fruit juice drinks companies, resulting that the legitimate rights and interests of consumers will be impaired. Additionally, the conduction will squeeze the living space of the small and medium-sized enterprises and bring some negative impact on the competition in the juice industry. From the foreign practices, this theory is rarely used and it is suspicious to employ the method and theory of the conduction effect by our Ministry of Commerce. They didn't clarify how the conduction happened from carbonated drinks to juice drinks, neither calculated market concentration by HHI or other methods nor analyzed the share of juice market in detail before/after the acquisition, and didn't estimate the share of carbonated drinks market, either.According to the previous experience, national brands after the acquisition will always become either victims of the foreign capital to promote its' own brand or foreign-funded enterprises on behalf of the processing. Therefore, it is very necessary to strengthen the protection to our national brands. Although the Ministry of Commerce shows in its official statement that the decision of prohibition acquisition is not for the protection of national brand, it still has an active role in protecting national brand in the consequence. The case of Coca Cola's acquisition of Huiyuan Juice reveals that there are a great many disadvantages in the substantive and procedural aspects of operator centralized control system such as non-quantified physical standards, undefined review subjects, murky application and review procedures, Based on the foreign experiences, the author puts forward some tentative suggestions, hoping to make a contribution to the improvement of our operator centralized control system.