Analysis Of Monopoly Of Oil Industry In China And The Legal Regulation Upon It

Oil is a type of important strategic resource which significantly influences thedevelopment of social economy. Because of the core position occupied by oil, themonopoly structure of oil industry and anti-competitive behaviors conducted by theseoil oligarchs are draw specific concerns from the public. The appeal for strengtheningregulation of monopoly, building benign order of competition and consumerprotection is increasingly upsurge. In the situation of lacking efficient competition, oilcompanies utilize economic powers that from grant of regime and dominant positionto carry out various anti-competitive action, include abuse of dominant position,lateral agreements for price fixing, differential treatment, etc. Such anti-competitivebehaviors severely damage common order of market competition and benefits ofconsumers. Therefore the anti-monopoly in oil industry is imperative.Unlike foreign oil sector, the reason behind infringing competitions by abusingdominant position of oil companies in Chinese oil market, is a combination of variousfactors. There are both historical reasons and current needs that Chinese oil industrymust involve into international competition; there are both national monopoly inupstream plus natural monopoly in midstream, and administrative monopoly in entiresector. In order to regulate monopoly in oil sector under the competition law system,we must clarify different reasons of monopolies and natures of it, adopt specificallytargeted measures of regulation, and introduce foreign experiences.After analyzing reasons and natures of oil industry in terms of different chains, the author believes that the competition regulation on Chinese oil sector shall turn tothree aspects: abolishment of political monopoly that for removing institutionalprotection large oil companies rely on; strengthen the power of enforcement ofcompetition law on anti-competitive conducts of large oil companies; emphasize theconsumers protection, introduce private enforcement of competition law.