The 13th NPC Standing Committee (NPCSC) concluded its 35th session on Friday, June 24, with the approval of four bills: amendments to the Anti-Monopoly Law [反垄断法] and the NPCSC Rules of Procedure [全国人民代表大会常务委员会议事规则], a revised Sports Law [体育法], and a new Black Soil Protection Law [黑土地保护法]. Below, we will first briefly discuss the Anti-Monopoly Law amendment before focusing on the new Sports Law and Black Soil Protection Law. We will leave the NPCSC’s updated procedural rules for a separate post.
Anti-Monopoly Law Amendment
This first-ever update of China’s competition statute, the Anti-Monopoly Law, was adopted against the backdrop of the Communist Party’s crackdown on anticompetitive conduct and the “disorderly expansion of capital.” The amendment makes important changes to rules on monopoly agreements and merger review, imposes new prohibitions on administrative monopoly, and substantially increases penalties for antitrust violations. It also, notably, expressly prohibits anticompetitive conduct that exploits “data, algorithms, technology, capital advantages, or platform rules,” signaling that regulators will continue to scrutinize China’s digital markets (art. 9 as amended).
The amendment also authorizes procuratorates at or above the municipal level to bring civil suits against businesses that harm the public interest with anticompetitive conduct (art. 60, para. 2). This grant of authority continues the legislative trend of gradually expanding the procuratorates’ role as public interest litigators, as we have observed before. Procuratorates generally have more resources, greater legal expertise, and broader investigative authority than private plaintiffs such as individual consumers, who, according to an antitrust law scholar, often lose antitrust suits due to a lack of resources and information asymmetry. Some practitioners speculated that this new provision could “shift China’s antitrust enforcement program” by incentivizing local procuratorates to “seek damages on behalf of local consumers” in straightforward, low-profile cases.
For other provisions of the amendment, we recommend this detailed summary and analysis by the law firm DLA Piper.
Sports Law Revision
The Sports Law was originally enacted in 1995. That was a time when China predominantly focused on cultivating athletic talents through the controversial “whole national system” [举国体制], in which the state marshaled its resources to select and train gifted children from a very young age to compete in national and international games. It was not until after the 2008 Beijing Olympics that the government began to pay more attention to the physical fitness of the general public. In recent years, the State Council has released policy documents aiming to transform China into a “sports powerhouse” [体育强国] and to promote citizens’ health and boost the sports industry through the “Fitness-for-All Strategy” [全民健身战略]. The revised Sports Law, which has more than doubled in the number of articles, reflects these new priorities.
The revision codifies the “Fitness-for-All Strategy” (art. 16) and lays down various measures to promote physical exercise among the public (especially school-age teenagers) and to support the sports industry. Local governments are required to provide the necessary conditions that enable all citizens to engage in physical exercises (art. 20), including by building sufficient public sports venues and facilities and ensuring that they are accessible to the elderly and persons with disabilities (art. 82). Citing the issue of declining physical fitness among teenagers, lawmakers also added provisions requiring schools to hold physical education classes and ensure that students can exercise for at least one hour during each school day (arts. 26–27). Finally, the Law also includes new policy provisions supporting private investments and innovations in areas such as sporting goods manufacturing, sports facilities, and sports services (arts. 69–71, 74).
Beyond embodying the government’s new focus on public-oriented sports activities, the revision also added much-needed new rules on sports arbitration. The 1995 Law did require the State Council to establish “sports arbitration bodies” to resolve disputes arising in competitive sports, but the State Council never acted. This then created a jurisdictional vacuum that has left many professional players and coaches with no legal recourse when they try to get unpaid wages from sports clubs that have dissolved due to financial troubles. One soccer player in such a situation first sought arbitration through the Chinese Football Association’s internal arbitration mechanism (which was not established under the 1995 Sports Law), but the Association denied his request because his now-dissolved former employer was no longer bound by its rules. He then attempted labor arbitration and civil litigation, but both the labor arbitration commission and the court decided that they lacked jurisdiction over the matter and dismissed his cases. The revised Sports Law now provides for detailed rules on the composition and jurisdiction of sports arbitration commissions as well as on judicial review of arbitral decisions (see Chapter IX). In addition, it makes clear that ordinary commercial and labor disputes—as opposed to, say, disputes over athlete discipline for anti-doping violations—are not subject to sports arbitration (art. 92, para. 2).
The revision, moreover, strengthens regulatory oversight over high-risk sports activities, responding to the 2021 Gansu ultramarathon disaster, in which 21 participants died from hypothermia as a result of mismanagement by the event organizer and local government. A new provision requires the organizers of sports events to ensure their safety and create plans to reduce risks and respond to emergencies (art. 102, para. 3). Sports regulators are directed to review those plans and halt an event when emergencies like extreme weather conditions occur (id. paras. 1, 4). For high-risk sports, the Law additionally requires event organizers and businesses to purchase accident insurances (art. 90) and to obtain permits before they can engage in such activities (arts. 105–06).
Finally, we want to note two other changes to the Law. The first is a new chapter on anti-doping measures and administrative penalties for encouraging, coercing, or organizing doping by athletes or offering stimulants to athletes (see Chapter V; art. 118). The second is a provision added just before the revision’s passage that authorizes the Chinese government to take countermeasures when any foreign entity “harms the sovereignty, security, developmental interest, or dignity of the People’s Republic of China in international sporting events,” without giving further details (art. 120).
The revised Sports Law takes effect on January 1, 2023.
Black Soil Protection Law
The Black Soil Protection Law is the latest addition to China’s growing body of environmental legislation that protects specific geographical features. It defines “black soil” [黑土地] as the farmland in relevant regions of four provinces in China’s Northeast—Heilongjiang, Jilin, Liaoning, and Inner Mongolia—that “has black or dark black humus topsoil, desirable trait, and high fertility” (art. 2, para. 2). China’s black soil region is one of the largest in the world and contributes to approximately a quarter of the country’s grain production. It is thus key to ensuring China’s food security, but has been suffering from erosion and declining fertility, prompting the Law’s enactment.
The Law directs the relevant State Council departments to “scientifically and reasonably” draw the boundaries of protected black soil based on a holistic consideration of various factors, including agricultural history, current use, and soil characteristics, to facilitate comprehensive and integrated efforts conserve and restore black soil (art. 4, para. 2). In particular, any area that was historically black soil should “in principle” be protected and restored unless it is “indeed beyond restoration” (id.).
Central and local governments bear primary responsibility for protecting black soil under the Law. They are required to investigate the current conditions of black soil, regularly monitor soil characteristics, depth of black soil layers, and the level of erosion, and create black soil protection plans based on the data gathered (arts. 9–10). Local governments must also take a variety of specific and tailored measures to improve agricultural infrastructure for black soil, promote scientifically sound farming practices, and prevent erosion, desertification, and salinization (arts. 12–16). In addition, the Law encourages research and development relating to black soil protection, reparation, and use (art. 11), and requires the farming industry to adopt environmentally friendly farming techniques, on pain of denial of certain agricultural subsidies (arts. 17–19; art. 31, para. 3).
Land with black soil must be used to grow agricultural products, including cereals, oil crops, sugar crops, and vegetables (art. 5). Such land may be used for construction only in exceptional circumstances, in which case the top plough layer of the black soil must be separated to improve other farmland, and the party must supply new farmland of equivalent quantity and quality (art. 21). Finally, the Law includes a new prohibition on unlawfully selling black soil and knowingly purchasing black soil that is unlawfully sold, backed with stiff penalties (arts. 20, 33).
The Law takes effect on August 1, 2022.