The Efficiency Valuation Of The Regulations Regarding The Vertical Agreements

Differs from horizontal agreement,the per se rule does not regulate the vertical agreement all the time since the vertical agreement sometimes has its economic justification.This paper will pay more attention to the economic justification of the vertical agreement,analyze the efficiency valuation of the regulations regarding the vertical agreement.On August 1,2013,the first antitrust case regarding vertical agreement dispute was declared in the Shanghai High People's Court.In February of the same year,National Development and Reform Commission punished the Maotai Company and Wuliangye Company with a fine of RMB 449 millions.Later in the same year,the National Development and Reform Commission carried out an investigation to 9 milk powder companies and finally punished 6 of them with a fine of RMB 668.73 millions.These cases brought a huge influence to the antitrust theoretical and practical circles and triggered a trend on reflecting over the present antitrust regulation system.This paper summarizes the present situation of the regulation on the vertical agreement in China,and analyzes the legislation and cases in the US and EU,focusing on the application of the rule of reason and the economic justification of vertical agreement.Based on the comparison of the other jurisdictions,this paper will try to figure out the highlights and shortcomings of the current legislation in China and come up with some workable plan to improve the current regulation system.Chapter one will show an overview of the vertical agreement and introduce the concept and classification of vertical agreement,especially the vertical price restraint.Meanwhile,this part will introduce the other types of vertical agreement such like market fragmentation,tying,exclusive dealings.Chapter two analyzes the efficiency valuation of vertical agreements and its influence to the social efficiency.The problem of “free rider” will also be discussed in this part.Another important part of this paper will introduce the rule of reason in China.Chapter three will introduce the regulations about vertical agreement in other jurisdictions like the United States and Europe.Now most jurisdictions acknowledge both the positive and negative effect of vertical agreements.The rule to regulate it also transfers from rule of per se to rule of reason.In this part,the development of legislations and case law regarding vertical agreements in the US will be introduced in detail.Situations in EU will also be analyzed.Some typical systems like the “block exemption” will be introduced.Chapter four will introduce the present antitrust regulation on the vertical agreement in China,and summarize the provisions regarding vertical agreement in the Chinese Antimonopoly Law as well as its advantages and disadvantages.This part will also introduce the regulation situations before the Chinese Antimonopoly Law came into effective and other regulations regulates the vertical agreement.The rest of this chapter will try to provide some workable advises to improve our present system of regulation based on the former parts.Some suggestions like making certain standards to define the vertical agreement,carrying out relevant detail solutions and improving the system of burden of proof,etc.