After being shelved for a year, the Anti-trust Law finally made it to the desk of one National People's Congress member last week.

Even though this second draft includes more rules limiting state-owned monopolies and protecting consumer interests, according to experts involved in the drafting, there are still government bodies insisting that the Law increases protection of the current state-owned economy. Experts also note that the draft still does not clearly state its jurisdiction over state-owned industries.

This hints that the content dealing with "administrative monopolies", which had been deleted after the initial draft, is actually still being debated behind closed doors. And whether or not certain parts of the Law, for example the hard-earned limitations placed on state-owned monopolies, actually become enforced remains to be answered.

The Anti-trust Law's second draft was considered from June 24-29th during the 10th plenary session of the Standing Committee of the National People's Congress' 28th Meeting. Compared with the first draft, there are six main new items.

Among them, Rule 7 states that prices and services managed by "the state-owned firms that are the lifeline of the economy or relate to national security, along with legal monopolies" will be supervised by the government.

This addition drew the attention of both the public and the NPC Standing Committee. When the Committee broke up into groups to deliberate, many members expressed concern that state-owned firms are involved in monopolistic behavior that causes serious injury to consumers, and therefore, the law should increase its sanctions against such behavior.

Public focus on telecommunications pricing became a hot topic. "China is a developing country, but its phone prices are higher than the US and Europe. Why should China's citizens have to bear such costly phone prices?" says Wang Maolin, member of the Committee. "These telecom institutions make more than 100 million yuan in profit every year, we should give some of that back to the people…"

Wu Changyuan, deputy director of Hainan province's NPC standing committee points out that from a government management perspective, concerned departments should look at the issue with public, and not industry, interest in mind. He says that excuses can't be made for the supervision of industries that are monopolized.

The powder keg of debate that has exploded during the discussions has made the media optimistic about the establishment of a legal framework for the repeal of two-way fee collections.

Even so, from start to finish, one expert involved in the drafting have revealed to the EO that the Law's revision will possibly run counter the hopes of the Committee and the public optimism.

According to this expert, because the jurisdiction of the law over state-owned monopolies hasn't been settled, this makes any headway in consumer protection possibly moot.

Furthermore, in the process of soliciting feedback during the first round of drafting, the central government made it clear that anti-trust legislation should fully consider protecting state-owned industries that are the core of the economy. It indicated that the government's control of power, communications, railway, civil aviation, oil, and other such industries that form the lifeblood of the economy, is natural as they require state-owned capital for control, and thus should be given full protection in the legislation.

Article 7, which was added during the first round of drafting, says that "Monopolized industries that are the lifeline of the nation's economy and security, will be, according to law, given ample protection by law to provide their goods and services…Regarding the management behavior of managers, their goods and services will be priced according to law and supervised by the government."

According to this expert, the key problem here is what exactly "according to law" means— and whether it is according to the "Anti-Trust Law" itself, or according to established laws from other agencies or regarding specific industries. There is a big difference between the two.

If it's according to established laws, for example, the Electric Power Law, Telecommunications Law, Energy Resource Law, Insurance Law, Civil Aviation Law, etc., then although the Anti-Trust Law stipulates the "protection of consumer interests", these laws overwhelmingly reflect the interests of their own agencies or industries. Furthermore, the supervisors and the supervised are strongly linked, and thus the Law can't influence this behavior.

Thus, if it's according to Law "in general", the new law will actually permit industries agencies to regulate themselves, and unlike i's title suggests, the Anti-Trust Law will be hard pressed to reach it's goal.

Sinopec is a perfect example. It enjoys its monopoly status on the basis of national security, and its prices are set by the National Development and Reform Commission according to pricing law.

The anonymous experts quoted in our article says that it's not that they disapprove of the government dealing with certain industries with special ways, but that it should gradually introduce competitive elements, and with that third-party involvement, China can finally truly help consumers avoid being injured by monopoly interests.