ABSTRACT
After the promulgation of its Anti-Monopoly Law (AML) on 1 August 2008, 1 China became the third largest antitrust jurisdiction in the world after the United States (US) and the European Union (EU) (Tucker and Walkdmeir 2008). Since then, there has been a considerable debate on how this law could be effectively implemented. Given the large geographical scope of China, a major issue is whether decentralized enforcement is to be preferred to a centralized system (Van den Bergh and Faure 2011). This chapter aims at contributing to this discussion in two ways. First, lessons will be drawn from the economic analysis of (de)centralization. The starting point of this analysis is that decentralization is to be preferred since it creates the conditions for efficient allocation of competences. However, significant externalities, scale economies, information problems or ruinous competition (‘race to the bottom’) may justify that decisions are taken at a higher level of government. Second, an explanation will be sought for the current division of competences by using a Public Choice perspective. The incentives of the different actors who may have an impact on the extent of (de)centralization will be studied. Particular attention will be paid to the interests of the competition authorities at different levels of government and business associations.
