The Competition Tribunal in 2020 filed a lawsuit against Tianli Bookstore, Commerce Press, Joint Publishing, and the general manager of Tianli Bookstore for conspiring to fix prices, bid rigging, and market allocation in the sale of textbooks for primary and secondary schools. They demanded the court to declare the defendants in violation of the “First Conduct Rule” and to impose fines, as well as to revoke the directorship of the accused. The case was heard in the High Court on the 15th.
The plaintiff in this case is the Competition Commission, and the four respondents are Tianli Bookstore Limited, Commerce Press (Hong Kong) Limited, Joint Publishing (Group) Limited, and Tianli Bookstore’s general manager, Xu Chaoming.
The opening statement from the side of the Competition Commission pointed out that in a retail industry association meeting held in 2011, the then chairman Xu Chaoming suggested that the industry agree to limit customer discounts to no more than 10%, and urged members to reduce the discount level on textbook orders to a maximum of 12%.
The Competition Commission stated that the conspiracy agreement of the defendants continued after the implementation of the Competition Ordinance in 2015. Tianli Bookstore and other bookstores continued to act in accordance with the agreement, offering the same discounts to multiple Catholic schools, with the agreement remaining in force until 2017. When Xu Chaoming and others learned about the investigation, they changed the 7% discount traditionally given to schools, a move that the Competition Commission believes was not a mere coincidence.
Representatives from Commerce Press and Joint Publishing argued that if someone unilaterally proposed a discount figure at a meeting and the other party did not respond, it does not constitute an agreement. The defense also questioned the lack of evidence from publishers and the absence of accusations against other stakeholders in the retail industry association.
Case number: CTEA 2/2020
Editor: Chen Wengqi