Antitrust Law Regulation Of Horizontal Shareholding By Institutional Investors

Foreign scholars in the U.S.aviation industry for the first time found the phenomenon of institutional investors horizontal shareholding phenomenon and empirical analysis of its causal relationship with the anti-competitive effect,since then also found the same problem in the seed pharmaceutical industry,a large number of studies have shown that this problem will be an unavoidable class of emerging problems in the field of anti-monopoly law enforcement,The continuous development of China’s capital market,in the context of the state to encourage institutional investors to actively participate in corporate governance,the importance of discussing this issue is self-evident.The full text is divided into four parts.The first part of this paper first introduces the existing research theories in foreign countries to introduce the concept of horizontal shareholding of institutional investors,and through the analysis of the mechanism of competitive collusion,it is found that institutional investors will participate in corporate governance through the exercise of voting rights,executive incentives and other means,which promotes the collusion and coordination between competing enterprises to harm market competition,and then puts forward the research question of this paper: whether the horizontal shareholding of institutional investors will trigger anti-competitive effects and lead to market monopoly.The second part takes the view back to China and responds to the need to study the problem from an economic perspective.First of all,we sorted out the reality of horizontal shareholding of domestic institutional investors and found that this situation does exist in China.Secondly,the empirical analysis of the causal relationship between the two found that the horizontal shareholding of institutional investors and the Lerner Index(an indicator reflecting monopoly)showed a significant positive correlation,that is,the horizontal shareholding of institutional investors will trigger monopoly,but this emerging,hidden financial capital monopoly tangible commodity market model has not yet entered the field of vision of China’s anti-monopoly law,so it is necessary to study such problems to prevent potential harm.From the perspective of law,international scholars believe that it is feasible to use Article 1 of the US Sherman Act and Articles 101 and 102 of the Treaty on European Union to regulate such issues,but there are also defects and deficiencies,and it is difficult for the plaintiffs of the "monopoly agreement" in Article 1 of the Sherman Act and Article 1 of the Treaty on European Union to prove it,and it is difficult to determine the subjective intention of conspiracy.The market dominance analysis of Article 102 of the Treaty on European Union has certain reference significance,but in reality,institutional investors will not form a dominant market position and constitute abuse of rights,and the inclusion of this article is not completely consistent.The author believes that such domestic regulations can fall into the monopoly agreement in article 13 of Chinese Anti-Monopoly Law and the centralized control clause in article 20 of Chinese Anti-Monopoly Law,thus summarizing the two paths of horizontal shareholding of institutional investors under anti-monopoly regulations.First of all,the monopoly agreement provided for in Article 13 of Chinese Anti-Monopoly Law includes other coordinated acts,and when institutional investors horizontally hold competing enterprises in the market to make consistent price increases or restrictions on production,which harm market competition,they draw on the "implied conspiracy" proof system of the United States to identify such acts as other coordinated acts,and then fall into the regulations of Article 13 of the Anti-Monopoly Law.Secondly,judging from the determination of law enforcement cases in Recent Years in China where minority equity constitutes a concentration of undertakings,institutional investors holding equity in enterprises with competitive relationships,plus additional factors such as informal meeting communication,executive personnel arrangements,and solicitation of voting rights,will also obtain control of the investment enterprise and thus constitute a concentration of undertakings,violating Article 20 of the Anti-Monopoly Law.The dilemma encountered in the use of this clause is that the standard of control in China is not clear,and the definition of control,the basis for determination and the quantitative operation of the determination are all vague,although in practice there have been determinations that very small minority equity also constitutes the acquisition of control,but this determination is extremely case-specific and the legal basis is insufficient,and it is difficult to form a typed identification model.In addition,for the minority equity that cannot be identified as the acquisition of control,that is,the "non-controlling minority equity",it will also cause anti-competitive harm,and the international community has now been generally aware of this phenomenon,such as if institutional investors hold minority equity in each enterprise horizontally,this phenomenon in China’s regulatory thinking needs to learn from the Towards more effective EU merger control white paper on the review of "non-controlling minority equity",comprehensively consider the shareholding ratio and additional factors,and identify from the perspective of substantive control,such as the appointment of executives,The linkage factors such as the solicitation of votes should pay special attention to the special economic linkage situation of horizontal shareholding by institutions,which have been empirically established as positively related to monopolies and included in the scope of review of the Anti-Monopoly Law.Using the control clause to regulate the horizontal shareholding of institutional investors,the author believes that first of all,it is necessary to clarify the control standard,clarify its connotation and basis for identification,and quantify the identification indicators,and if the institutional investor obtains control under the review of the external standard,it will fall into the regulation of the article.For non-controlling minority shares,such as a 5% shareholding ratio,which cannot be reviewed from external formal standards such as shareholding ratio,it is necessary to consider various additional factors in the review path of the Towards more effective EU merger control "non-controlling minority shares".As a result,the control clause can cover the horizontal shareholding behavior of institutional investors more comprehensively.