ISSUING AUTHORITY:

Anti-Monopoly and Anti-Unfair Competition Committee of the State Council 

DATE OF ISSUANCE：

February 11, 2026

EFFECTIVE DATE：

February 11, 2026

I. Significance of Formulating the Guidelines

The Anti-Monopoly and Anti-Unfair Competition Committee of the State Council has issued the Guidelines of the Anti-Monopoly and Anti-Unfair Competition Committee of the State Council on Anti-Monopoly in the Public Utilities Sector (the “Guidelines”). The Guidelines focus on the monopolistic issues in the public utilities sector, accurately grasping the characteristics and market competition rules of the public utilities sector, systematically summarizing law enforcement experience, and comprehensively detailing the rules for identifying monopolistic behaviors in the public utilities sector.

The Guidelines were drafted due to the specific types, manifestations and damages of monopolistic behaviors in the public utilities sector. Public utilities refer to a series of industries that provide essential and universal goods or services for the production and life of the general public. These industries include water supply, power supply, gas supply, heating supply, sewage treatment, garbage disposal, public transportation, etc. Most of them have natural monopoly segments. Currently, monopolistic behaviors in the public utilities sector are relatively common. Public utility operators tend to extend or exclude or restrict the competition in upstream and downstream competitive segments from their monopolistic advantages.

The Guidelines provide clearer and more precise guidance for anti-monopoly law enforcement in the public utilities sector and the compliance of operators. It not only helps to enhance the scientificity, targeting and effectiveness of anti-monopoly law enforcement, but also contributes to the establishment of a long-term mechanism for anti-monopoly supervision in the public utilities sector, promoting the continuous, standardized and healthy development of public utilities.

II. Main Contents and Features of the Guidelines

The Guidelines consist of seven chapters and 50 articles, covering seven aspects including general provisions, monopolistic agreements, abusing dominant market position, business concentration, fair competition review and abusing administrative power to exclude and restrict competition, application of legal responsibilities, and appendices.

III. Targeted Regulations in the Guidelines Regarding Monopolistic Behaviors in the Public Utilities Sector

1. Definition of Relevant Market

The Guidelines state that when defining the relevant market in the public utility sector, it is necessary to conduct demand substitution and supply substitution analyses using counterfactuals based on the characteristics of publicity, regional nature, and policy nature of the public utility sector. The Guidelines specifically clarify that if a public utility operator provides services relying on a physical network or other key infrastructure, the relevant geographical market is generally defined as the coverage area of that physical network or other key infrastructure. For projects involving special permission, the definition of the relevant geographical market can also consider the competitive scope for selecting special permission holders by the special permission project implementation agency.

2. Determination of Market Dominance

The Guidelines stipulate that when determining whether an operator in the public utility sector has market dominance, analysis can be conducted by taking into account the existence of natural monopoly segments and the special permission operation model in the public utility sector. Moreover, "the ability of public utility operators to control the physical network or other key infrastructure for providing related goods" is regarded as a key consideration factor.

3. Determination of Monopoly Agreements and Abusing Market Dominance

Based on the summary of law enforcement experience, the Guidelines further elaborate on the specific manifestations of monopoly agreements that are common in industries such as bottled liquefied gas, as well as other abusive market dominance behaviors such as restrictive transactions, tying sales, and imposing other unreasonable transaction conditions that are common in industries such as water supply, power supply, gas supply, and heating supply. At the same time, considering that the prices of residential water, electricity, gas, and heat are generally subject to government pricing, for monopoly agreements and abusive market dominance behaviors related to prices, it is clearly stipulated that they pertain to goods or services other than those priced and charged in accordance with the government's legally established standards.

4. The Defenses of the Operators

Because public utilities involve public safety and the guarantee of essential services, in law enforcement practices, operators often use this as a defense for implementing monopolistic behaviors. The Guidelines specifically stipulate the conditions for exemption from monopoly agreements and the justifiable reasons for abusing market dominance. For example, Article 14 of the Guidelines regards "whether the agreement is a necessary condition for safeguarding public safety, essential services, and other social public interests" as a key consideration for determining whether the conditions for exemption from monopoly agreements are met; Articles 18, 19, 22, and 24 specify the possible justifiable reasons for public utility operators to implement abusive market dominance behaviors such as refusing transactions, imposing restrictions on transactions, and providing differential treatment; Article 25 clearly states that if a public utility operator uses the claim of safeguarding public safety as a reason for abusing market dominance without legal or regulatory basis, it will generally not be considered as a justifiable reason, unless the operator can prove that it is necessary for safety.

5. Review of Concentration of Business Operators

The Guidelines specifically stipulate that in the public utility sector, if a business operator acquires control over other operators or can exert decisive influence over them by means such as purchasing the operational network or other key infrastructure assets, it generally constitutes a business operator concentration. To prevent business operators from leveraging their monopoly advantages to extend into competitive upstream and downstream links, the anti-monopoly enforcement agency of the State Council focuses on business operator concentrations implemented by public utility operators in natural monopoly links, especially those between public utility operators in natural monopoly links and competitors in competitive links.

6. Identification of Acts of Abusing Administrative Power to Exclude or Restrict Competition

The Guidelines address the issues of abusing administrative power to exclude or restrict competition in the public utility sector, such as imposing restrictive transactions, hindering other operators from entering related markets, obstructing the free circulation of goods, excluding or restricting public utility operators from participating in public-private partnership projects through open competition, excluding or compelling out-of-town public utility operators to invest or establish branches locally, and compelling or covertly compelling operators to engage in monopolistic behavior. The Guidelines detail the manifestations of these acts and clearly define the identification criteria.

Reference:

《国务院反垄断反不正当竞争委员会关于公用事业领域的反垄断指南》