Antitrust issues continue flaring up in China's IT sector

On 30 and 31 January 2013, the Chinese State Administration for Industry and Commerce (SAIC) posted a press release and a brief question-and-answer protocol (Q&A) on its website to inform of a recent enforcement action. According to these documents, SAIC’s local branches in Beijing had issued a notice to the Chinese software company Qihoo 360 a week earlier, warning the company about its allegedly unfair competition practices. While the immediate implications of this ‘warning’ notice are not entirely clear, the case is symptomatic for the current state of the Chinese IT sector. SAIC’s ‘warning’ notice may not be the last word in this case.

According to the press release and the Q&A, Qihoo 360 has a market share of over 80% in the “security software market” in China. The local SAIC branches in Beijing –the Administration for Industry and Commerce (AIC) of Beijing and a district of Beijing– found that Qihoo 360 had used this “monopolistic market advantage” to induce users of its security software (such as anti-virus software) to use its own browser, and to impede security software competitors by making its own security software incompatible and difficult to uninstall…

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