[Keywords] Civil; Anti-Unfair Competition; Monopolistic Operator

Handling Attorney: Cao Yuanjun

This case is a dispute over unfair competition. After review and approval by the Supreme People's Court, our litigation claims have been upheld. 
Basic Facts of the Case: 
On July 20, 2006, a certain association issued a document to relevant organizations nationwide, requiring each member unit to participate in only one specialized exhibition related to [specific field] each year. For other comprehensive exhibitions, enterprises could decide whether or not to participate based on their own needs. Any member unit that had already participated in the “China International [Specific Field] Exhibition” held in May 2006 and subsequently attended other specialized [specific field] exhibitions would not be allocated a booth at the “2007 China International [Specific Field] Exhibition.” In this case, our client’s Information Center was specifically “named” by the association. As early as February 10, 2006, the Information Center had sent a notice to all relevant organizations, announcing that the National Weighing Equipment and Technology Exhibition would be held from October 30 to November 3 of the same year at the Jiangsu Exhibition Hall. After the association issued its document, the招展 work for our client’s exhibition was severely disrupted. Several units that had already registered withdrew from the exhibition, and many others that had initially expressed interest in participating also became hesitant to register. Concurrently scheduled conferences were likewise canceled, causing the Information Center substantial economic and reputational losses. Therefore, we believe that the association has violated the Anti-Unfair Competition Law and have filed a lawsuit accordingly. 
The primary point of contention in this case is whether the某某 Association qualifies as an operator and whether its practice of collecting fees from exhibitors, issuing invoices supervised by the tax authorities, and providing services to the market when organizing the exhibition in question constitutes an act of business operation. 
Attorney Cao Yuanjun’s representation and opinion are as follows: Although industry associations are classified as non-profit social organizations, their status as operators should be assessed comprehensively based on the nature of the activities they engage in. On the one hand, market access for operators of international science and technology exhibitions is subject to special restrictions under the “Interim Measures for the Administration of International Science and Technology Conferences and Exhibitions” issued by the State Ministry of Science and Technology. Only certain associations are authorized to organize internationally renowned professional exhibitions, giving them exclusive operating rights—leaving exhibitors and visitors with no alternative choices. On the other hand, these associations also charge fees from exhibitors and issue invoices. Therefore, both in form and substance, the association in question clearly meets the characteristics of an operator and holds a monopolistic position. According to documents such as the “Reply of the State Administration for Industry and Commerce on How to Determine Other Operators That Lawfully Hold Monopolistic Positions,” the association has established a business position in the relevant market characterized by exclusive operation, insufficient competition, and strong dependency of users or consumers on the goods and services it provides. Thus, whether in fact or in law, the association in question is indeed an operator holding a “monopolistic position.” Based on this, the association’s refusal to provide exhibition services at the China International [Name of Exhibition] to entities that do not accept its unreasonable conditions violates the principles of voluntariness, equality, and fairness that should govern market transactions. In essence, this action effectively restricts users’ ability to purchase exhibition services offered by our client’s information center, constituting an act of unfair competition. 
Case Highlights: 
Through careful analysis and interpretation of relevant laws, combined with the specific facts of the case, Attorney Cao Yuanjun identified the correct defense strategy. Ultimately, the court ruled that the某某 Association was an operator holding a dominant position, and its actions had excluded the Information Center from fair competition, resulting in the cancellation of the exhibition that the Information Center had planned to hold. Therefore, the某某 Association’s conduct constituted unfair competition. The final judgment ordered the某某 Association to issue a public apology on its website and compensate the Information Center for its economic losses, thereby putting an end to the某某 Association’s unfair competitive practices. This decision not only helped the Information Center recover its economic and reputational damages but also protected its legitimate rights and interests and upheld a fair and competitive market environment. 
Typical significance: 
With regard to this case, the Supreme People’s Court issued a reply concerning the dispute over unfair competition between the Information Center and a certain association. The reply states: If an industry association engages in paid services or other commercial activities, it may be deemed an operator as defined in Article 2, Paragraph 3 of the Anti-Unfair Competition Law. Operators—other than public utilities—that are granted exclusive operating rights for specific goods or services by laws, regulations, rules, or other normative documents may generally be considered “other operators holding a monopolistic position” as stipulated in Article 6 of the Anti-Unfair Competition Law. 
Lawyer’s Insights: 
As we delve deeper into this case, we can see how legal provisions are interpreted and applied in the context of a complex social reality, gaining a more profound understanding of the crucial role that law plays in maintaining a fair and competitive market environment. Law is not merely a collection of words; rather, it is an embodiment of justice and equity. As agents, when confronted with complex and ever-changing real-world situations, we must possess the wisdom to apply the law flexibly, ensuring that each representation stands the test of time and helps uphold social fairness and harmony.