Shanghai releases China’s first local anti-unfair competition regulations

The 26th session of the Standing Committee of the Shanghai Municipal People's Congress has adopted the Shanghai municipality’s newly amended regulations to combat unfair competition. The rules are designed to facilitate good business relations and protect consumers and business operators and came into effect on 1 January 2021.

This is the first local anti-unfair competition regulation in China after the Anti-Unfair Competition Law was amended in 2017 and 2019.

The regulations clarify the following seven types of unfair competition in the law:

• acts that cause confusion, which includes use of the following without authorisation:
  • marks that are identical with or similar to another’s mark;
  • another rights holder’s unique product shape;
  • the name of a software program;
  • a company logo;
  • the name of an online store;
  • a name or logo used on social media; and
  • the name or icon of application which has a certain influence;
• commercial bribery;
• false advertising;
• trade secret infringement;
• illegal premium sales;
• commercial defamation; and
• unfair competition on the Internet.

Under Article 8, operators are not allowed to assist other operators in causing confusion by establishing a link between a keyword and a third party’s sign that enjoys a certain reputation. Articles 12 and 13 list information that may be construed as trade secrets and provides specific levels of confidentiality for this. Article 14 provides specific circumstances that constitute illegal premium sales and Article 15 clarifies several types of methods of disseminating information that constitute commercial slander.