Antitrust

Shearman & Sterling Antitrust Annual Report 2019

Shearman & Sterling LLP

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7 4 SAMR replaced MOFCOM, the relevant merger authority in China, from May 2018 and looks to continue MOFCOM's active presence in merger enforcement. By June 2018, MOFCOM/SAMR had cleared 166 cases under simplified procedure, 24 under normal procedure and approved one case under conditional approval. The review of Bain Capital's Microchip/ Microsemi mega-merger in May 2018 took less than a month, calming fears that the creation of SAMR would lead to delays in reviews of major transactions. On the other hand, Qualcomm terminated its acquisition of NXP Semiconductors N.V. in July 2018, on the basis that China missed the deadline for approving the deal and Qualcomm's 10-Q quarterly report stated that the approval process was "being impacted by the current state of U.S./China trade relations." SAMR also looks to continue China's clamp down on cartels, having already conducted dawn raids on U.S. memory chip maker Micron Technology and its South Korean competitors Samsung Electronics and SK Hynix in May 2018. SAMR and the Shandong Administration of Industry and Commerce have also imposed fines on household appliances and furniture stores for entering into monopolistic agreements to boycott third-party trade shows, security door manufacturers for cartel behavior, car companies for suspected price collusion and river sand companies for price fixing. Geopolitical tensions have continued to shape China's implementation of antitrust. Tensions with the U.S. antitrust authorities not only played out in the Qualcomm/NXP acquisition, but also in the vitamin C antitrust case, where the U.S. Supreme Court historically allowed the Chinese government to present arguments in an appeal. The Chinese government argued that the alleged price-fixing was mandated by Chinese law, raising questions of sovereign jurisdiction. More recently, commentators noted that China was unlikely to sign the DOJ's recently circulated draft of the Multilateral Framework on Procedures, due to conflicting provisions in China's Administrative Procedure act. JAPAN Japan has built a reputation as one of the key antitrust authorities in Asia. In 2017, the Japanese Supreme Court confirmed that cartel enforcement could apply to cases when the alleged cartelists do not have a physical presence in Japan, provided that the conduct results in substantial effects on Japanese markets. The Japan Fair Trade Commission (JFTC) has continued to vigorously investigate international cartels and, like many international regulators, is taking a tough stance on financial market players, as can be seen in its opening of an investigation in April 2018 against global investment banks alleging that traders in London engaged in cartel conduct when trading bonds for a Japanese client. Ultimately, the JFTC dropped this case on the basis that steps had already been taken to comply with Japanese law. Like many countries, a key enforcement priority for Japan is 'big data'. The JFTC has launched a recent probe into Google, Amazon and other major technology companies to assess whether the data that they possess allows them to abuse their dominant position and stifle innovation for Japanese companies. In particular, the JFTC is interested to see whether new entrants are blocked from the market because of the more established players hoarding customers' data. COMPLIANCE A K E Y E N F O R C E M E N T P R I O R I T Y F O R J A PA N I S ' B I G D A T A' The Antitrust Arms Race: How International Jurisdictions Are Increasing Enforcement Efforts 13

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