(Yicai Global) April 12 -- The guidelines released by China to accelerate the creation of a “unified domestic market” call for beefed up anti-monopoly efforts and a crackdown on unfair competition.

The guidelines, released on April 10 by the Central Committee of the Communist Party and the State Council, also make clear that the key obstacles to creating a unified domestic market are local protectionism and regional barriers in the country.

Administrative monopoly issues such as local protectionism and market segmentation hinder the smooth flow of commodity factors and resources on a larger scale, Li Enhan, vice director of the Tongzheng Digital Economy Research Center of the China Development Institute, a think tank, told Yicai Global.

To maximize their own interests, some local authorities have brought in regional blockades such as local protectionism and illegally offering preferential policies to market entities in their regions to generate new monopolies. This has harmed the interests of other market entities, Li said.

The guidelines suggest that the government should set up a directory or list of preferential policies for companies and make it public in a timely manner, promptly sort out and abolish regional policies that contain local protectionism, market segmentation, designated transactions and other acts that hinder a unified domestic market and fair competition.

The government should also comprehensively purge all kinds of preferential policies that discriminate against foreign-funded businesses and non-local firms and carry out local protectionism as well as conduct strict fair-competition reviews of newly-issued policies, according to the guidelines.

Abolishing existing discriminatory policies and strictly regulating new ones in future are two ways to crack down on local blockades, said Chen Bing, a professor at the Law School of Nanjing University, who cited the guidelines.

But Chen said that there are still certain practical difficulties in deepening the review of fair competition. For example, local authorities will not be willing to conduct such reviews or may even circumvent them, when the interests of areas under their jurisdiction are involved. So a need arises to accelerate the implementation of third-party assessments of the fair-competition review system.

A number of experts also noted that the review system should also be differentiated in terms of regions with varied levels of economic development.

The guidelines pointed out that the centralized review of operators in fields including finance, media, science and technology, and people’s livelihoods as well as involving startup companies, new business formats and labor-intensive industries will become the focus of supervision. 

Also, it said the government should crack down on the data monopoly of platform companies and prevent them from excluding and restricting competition via the use of data and algorithms as well as other technical means.

Editors: Zhang Yushuo, Peter Thomas