Application of general provisions of anti-unfair competition law
Competition Law Team of Sichuan Faxian Law Firm
In the last iss
Application of general provisions of anti-unfair competition law
Competition Law Team of Sichuan Faxian Law Firm
In the last issue of Da Rui and Houda's Dispute over Unfair Competition, it was mentioned that the application of general provisions against unfair competition should be strictly restricted. General clauses are one of the important clauses in the judgment of anti-unfair competition law, especially in the market economy with increasingly developed Internet. This issue will introduce the applicable rules of the general provisions of the Anti-Unfair Competition Law.
I. What are the general terms and conditions?
General clauses are widely used in the field of civil and commercial law, and can also be called general clauses, general clauses and principle clauses. For example, the principles of good faith, public order and good customs in China's civil code. Liang Huixing pointed out in the Hermeneutics of Civil Law that general clauses are open and uncertain. Because the legislators did not specify these general rules, judges can add their own judgments in the process of application.
The definition of general provisions in the Anti-Unfair Competition Law is: the general norms of the identification elements and punishment rules of unfair competition behaviors other than those specifically listed in the law, which is the legal basis for identifying and judging unfair behaviors not listed in the law. The specific provisions of the general provisions refer to:
Article 2 Operators shall follow the principles of voluntariness, equality, fairness, honesty and credibility, and abide by laws and business ethics in their production and business activities.
Unfair competition as mentioned in this Law refers to the acts of business operators in violation of the provisions of this Law, disrupting the order of market competition and harming the legitimate rights and interests of other business operators or consumers.
The Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Anti-Unfair Competition Law (hereinafter referred to as the new judicial interpretation) was promulgated on March 16, 2022 and came into effect on March 20th, which is an important measure to further improve the legal system of the anti-unfair competition law. Among them, the specific content of the general terms * * * has the following three provisions:
Article 1 Where an operator disturbs the order of market competition, damages the legitimate rights and interests of other operators or consumers, and violates Chapter II of the Anti-Unfair Competition Law and other provisions of the Patent Law, Trademark Law, Copyright Law, etc., the people's court may apply Article 2 of the Anti-Unfair Competition Law for determination.
Article 2. The people's court may identify market participants who may compete for trading opportunities or damage their competitive advantage in production and business activities as "other operators" as stipulated in Article 2 of the Anti-Unfair Competition Law.
Article 3 A code of conduct that is generally followed and recognized in a specific business field may be recognized by the people's court as "business ethics" as stipulated in Article 2 of the Anti-Unfair Competition Law.
The people's court shall, in combination with the specific circumstances of the case, comprehensively consider the factors such as industry rules or business practices, the subjective state of the operator, the choice will of the counterparty, the impact on consumer rights and interests, market competition order and social interests, and judge whether the operator has violated business ethics according to law.
When determining whether an operator has violated business ethics, the people's court may refer to the professional norms, technical norms and self-discipline conventions formulated by the competent department of industry, industry associations or self-discipline organizations.
Second, the applicable conditions of the general terms and conditions
Applicable theme
The subject of application of general clauses is judicial organs.
For the judiciary, litigation is the last barrier to protect the legitimate rights and interests of operators and consumers. Operators take their competitors to court, and the court will make a final judgment on the disputed disputes, but the competition between operators is often not fully covered by typing terms. Therefore, it is of course reasonable for judicial organs to apply general provisions to identify unfair competition.
Different from the frequent application of general clauses by courts, administrative supervision departments cannot enforce the law according to general clauses. The supervision and law enforcement of administrative organs follows the principle of "nothing can be done without authorization", and the Anti-Unfair Competition Law does not authorize the regulatory authorities to invoke the general provisions of Article 2 for law enforcement. Articles 18 to 24 of this law respectively stipulate that the regulatory authorities have the right to take measures such as ordering to stop illegal acts, confiscating illegal commodities or illegal gains, and imposing fines on the seven acts of unfair competition in Chapter II, but they do not stipulate that they violate Article 2, so the regulatory authorities have no right to punish them according to the existing provisions. At the same time, the provisions of the third chapter of the law on "investigation of suspected acts of unfair competition" cannot be applied to acts that violate the general provisions.
In the book Interpretation of People's Republic of China (PRC)'s Anti-Unfair Competition Law, the legislature holds that: "Because this law does not set corresponding penalties for acts that violate the general provisions, according to Article 3 of the Administrative Punishment Law, if there is no legal basis or legal procedures are not followed, the administrative punishment is invalid, and the administrative organ cannot apply the general provisions to investigate and deal with unfair competition acts." In practice, the regulatory authorities strictly abide by the authority set by legislators. For example, in 2020, the regulatory authorities of Guangdong Province filed 35 1 cases of unfair competition, all of which were subject to the provisions of Chapter II of the Anti-Unfair Competition Law, and none of them were investigated according to the general terms.
Applicable standards
When the typed clauses are not applicable, the general clauses play a complementary and comprehensive role. However, administrative organs and judicial organs should also follow the applicable standards when applying the general provisions to judge the legitimacy of competitive behavior. The application of general terms and conditions requires non-compliance with business ethics and causes harmful consequences. At least the following three conditions need to be met: first, Chapter II of the Anti-Unfair Competition Law and the Patent Law, Trademark Law and Copyright Law do not make special provisions on this kind of competition behavior; Second, it violates the principle of good faith and business ethics; Third, the legitimate rights and interests of other operators have actually been damaged by this kind of competitive behavior.
Violation of business ethics needs comprehensive identification
Article 2 of the newly promulgated judicial interpretation "Violation of Law" stipulates the boundary of the concept of "business ethics", that is, "the universally followed and recognized code of conduct in a specific business field". Business ethics takes the principle of good faith as the core, and takes business ethics as the substantive identification element of the legitimacy of competitive behavior, which embodies the important role and best value of some basic moral norms under the market economy. Recognized business ethics is an established practice in the industry, which can be widely recognized after repeated trade-offs and compromises. Its determination in a specific case must be judged by a judge in combination with economic, social and moral factors, and cannot be directly applied without argument. Whether the accused commercial competition behavior can conform to the provisions of the principle of good faith, whether it is legal and objective, also requires the judge to prove the business ethics created, which mainly comes from the standards of trade associations, business practices or technical specifications, daily experience rules or economic common sense.
The consequence of damage is also an important element to identify unfair competition.
An act should not be regulated if it does not cause damage, and the damage caused by unfair competition must be the destruction of the market competition order. Article 25 of the Anti-Unfair Competition Law stipulates: "If an operator engages in unfair competition in violation of the provisions of this law and has legal circumstances such as actively eliminating or mitigating the harmful consequences of illegal acts, he shall be given a lighter or mitigated administrative punishment according to law; If the illegal act is minor and corrected in time, and no harmful consequences are caused, no administrative punishment will be imposed. " Administrative organs and judicial organs must take the damage result as a consideration factor when determining the unfair competition behavior. At the same time, when determining whether to cause damage, we should also give consideration to various interests and try to balance the relationship between competitors' freedom of competition, operators' freedom of operation and consumers' legitimate rights and interests.
Three. Applicable rules of general clauses and special specifications
In the anti-unfair competition law, there are both general provisions and special provisions in the legal provisions, among which the general provisions stipulated in Article 2 and the specific norms stipulated in Chapter II are the relationship between general provisions and special provisions. To properly handle the relationship between general clauses and special clauses, we should not only make full use of the flexibility and adaptability of general clauses to effectively stop all kinds of unfair competition, but also prevent the arbitrariness of the application of general clauses and avoid hindering free and fair competition in the market.
Priority should be given to the specific provisions stipulated in Chapter II.
To identify the legitimacy of competitive behavior, we must first consider the provisions of Chapter II of the Anti-Unfair Competition Law and identify and judge the specific behaviors listed in the corresponding laws. All acts explicitly prohibited in Chapter II can only be regulated according to special provisions. In principle, the General Clauses are no longer applicable to expand the scope of application, and the applicable conditions of the General Clauses are strictly grasped.
If all the provisions in Chapter II of the Anti-Unfair Competition Law have exhausted an act of unfair competition, it is usually not appropriate to regard the act in this field as an act of unfair competition according to Article 2 as a general provision, otherwise it will violate the specially stipulated legislative policy.
Secondly, the general provisions, that is, the provisions of Article 2, shall apply.
For the market competition behaviors not specifically listed in Chapter II of the Anti-Unfair Competition Law, which can be cited by other laws and regulations, the people's court may, in accordance with the provisions of Article 2 of this Law, determine that the defendant violated the principles of voluntariness, equality, fairness, honesty and credit and recognized business ethics, and damaged the legitimate rights and interests of the plaintiff, resulting in disputes between operators with equal subjects.
Specific terms can be judged by referring to the general terms.
Even the acts of unfair competition stipulated in Chapter II of the Anti-Unfair Competition Law can refer to the general spirit of the general provisions, including Article 2 of the Law, when defining the acts of pending competition. For example, in the case of unfair competition on the Internet as stipulated in the second paragraph of Article 12 of the Anti-Unfair Competition Law, if the specific judgment factors are not well grasped, the legitimacy of competitive behavior can be judged according to the constitutive requirements stipulated in the second paragraph of Article 2 of the Law.
Fourth, explain the law by case.
Kaixun Company v. Li Yong and Huya (unfair competition case)
primary facts
The plaintiff is Hangzhou Kaixun Technology Co., Ltd. (hereinafter referred to as "Kaixun Company"), the defendant is Li Yong, the anchor trained by Kaixun Company and its affiliated enterprises, and the defendant is Guangzhou Huya Information Technology Co., Ltd. (hereinafter referred to as "Huya Company"), a new live broadcast platform maliciously breached by Li Yong. Li Yong, the defendant, signed an exclusive cooperation agreement with Yitian Center, the brokerage company of Kaixun Company, the plaintiff, and was assigned to the tentacle live broadcast website for live broadcast service. In the cooperation stage, the plaintiff found that the defendant Li Yong used the same cartoon image and nickname for live broadcast on Huya platform twice, and posted personal dynamics on the tentacle live broadcast platform operated by the plaintiff, and guided the fans to the new live broadcast platform by virtue of its unique stickiness with fans. Later, with the permission of the defendant Huya Company, Li Yong also conducted fan diversion through other social networking platforms such as WeChat and Weibo. The plaintiff believed that Huya Company maliciously induced Li Yong to breach the contract, stealing the plaintiff's users and traffic and reducing its market share, knowing that the exclusive cooperation agreement between Li Yong and the plaintiff had not expired, so it sued Li Yong and Huya Company to the court on the grounds of unfair competition and claimed compensation from them.
Focus of controversy
Can the anti-unfair competition law be applied to this case?
In this case, the plaintiff Kaixun Company believes that the defendant's behavior is not just a simple anchor job-hopping, and the regulation of contract law is not enough to make up for the losses suffered by the plaintiff, nor can it regulate the seduction behavior of Huya live broadcast platform. Defendant Li Yong claimed that his dispute with Kaixun Company should be regulated by the contract law, and the anti-unfair competition law should no longer be applied. Defendant Huya Company claims that its behavior constitutes normal market competition, the anti-unfair competition law should be restrained, and the contract law should be applied to the anchor job-hopping, otherwise it will make its adjustment function and breach of contract liability clause useless. However, in China's judicial practice, the applicable standard of anti-unfair competition law is mainly based on whether the original defendant has a competitive relationship, because this may affect whether the plaintiff is qualified, whether the case conforms to the nature of anti-unfair competition, and whether the accused behavior can be considered through the elements of unfair competition.
Do the actions of Li Yong and Huya Company constitute unfair competition?
In this case, the plaintiff Kaixun Company used the principle of proportionality to prove that the accused behavior was unfair from the aspects of business ethics, market competition order, public interests and consumer interests. However, the defendants Li Yong and Huya Company both denied that the alleged behavior violated the principle of good faith and business ethics, saying that the alleged behavior was a normal means of industry competition and there was no unfairness. Except for the acts explicitly listed in the second chapter of the Anti-Unfair Competition Law, most other cases of unfair competition in judicial practice are judged in the fields of good faith principle, business ethics, market competition order and so on. According to the provisions of Article 2 of this Law, there are still some cases that are judged by means of interest measurement. The judge's different identification paths will affect different judgment results. Even if the identification paths are the same, they will be influenced by the judge's personal value judgment, the parties' proof and other factors, resulting in different judgment results. Therefore, the most critical dispute in this case is whether the defendant's behavior has formed unfair competition.
court decision
1. Opinions of the court of first instance
The Hangzhou Intermediate People's Court, the court of first instance, held that: 1. The plaintiff and the two defendants in this case do not belong to the same legal relationship and need to be analyzed separately. First, since there is an agreement between the plaintiff and the defendant Li Yong that can directly apply the contract or relevant laws and regulations, the other party can be held liable for breach of contract. Second, both the plaintiff and the defendant Huya Company conduct live online game operation, which constitutes the "operator" for the adjustment of the anti-unfair competition law; There is a competitive relationship between the two, which constitutes market competition behavior; Whether Huya Company constitutes unfair competition behavior needs to be further determined whether it violates the principle of good faith and business ethics.
Secondly, as a new industry, live game broadcasting has not yet formed * * * business ethics knowledge in relevant markets. Business ethics is also the core of the principle of good faith. After analyzing the behavior, purpose and consequences of market operators, the court found that the defendant did not violate business ethics.
To sum up, in April 2020, the court of first instance ruled that the actions of the two defendants did not constitute unfair competition.
2. Opinions of the court of second instance
The Higher People's Court of Zhejiang Province, the court of second instance, held that, first of all, the application of the anti-unfair competition law should adhere to the principles of modesty and prudence when the parties can obtain effective relief through contractual agreement or legal means. Regarding whether the defendant Li Yong used the same cartoon image and nickname on the new live broadcast platform and maliciously diverted users and traffic constituted unfair competition, the court held that the contract law could be used to regulate it.
Secondly, business ethics cannot be equated with social ethics or personal ethics, and whether unfair competition can be formed needs to be judged through various analyses. Competing for talents with high salaries is a common way of market competition, and the live game industry is not a field of national economy and people's livelihood. All the activities it produces are essentially market economy activities, and enterprises should fully abide by the development rules of market economy and free competition. Therefore, the anchor's job-hopping behavior has not had a significant negative impact on consumers' independent choice and market competition order.
To sum up, the court of second instance rejected the appeal in June 2020 165438+ 10 and upheld the judgment of first instance.