Short answer: in most cases, no. Price fixing between competitors is an administrative violation under China’s Anti-Monopoly Law, not a criminal offence, and the penalty is a fine rather than prison. The same conduct can cross into criminal territory, however, when it takes the form of rigged bidding or fraud.

What Does China’s Anti-Monopoly Law Say?

Article 17 of the Anti-Monopoly Law (2022 revision, formerly Article 13 of the 2007 law) bans competing businesses from entering into monopoly agreements that fix or change prices, limit output, or divide markets. This targets the classic cartel, where competitors agree on a price instead of competing on one.

What Is the Penalty for Price Fixing?

The consequences are set out in Article 56. A business that concludes and carries out a monopoly agreement faces an order to stop, confiscation of illegal gains, and a fine of 1% to 10% of its sales in the previous year. If it had no sales in that year, the fine can reach RMB 5 million, and if the agreement was reached but not yet carried out, up to RMB 3 million. Responsible individuals, such as the legal representative, can personally be fined up to RMB 1 million. Because the fine is calculated on China-wide sales, the amount can be very large.

When Does Price Fixing Become a Crime?

Price fixing by itself is not in the Criminal Law. Criminal liability appears when the conduct takes a criminal form. The clearest example is bid rigging, where competitors collude on tenders. That is a crime under Article 223 of the Criminal Law, punishable by up to three years’ imprisonment or criminal detention, plus a fine. Cartel conduct tied to fraud, forgery or bribery can also be prosecuted under those separate offences.

A Practical Scenario

Imagine three cement suppliers in one province agreeing on a minimum price. The market regulator can fine each of them 1% to 10% of last year’s sales and order them to stop, but no one goes to jail for the price fixing alone. If the same three companies instead rigged a public tender, the individuals involved could face criminal charges under Article 223.

Key Takeaway

In China, price fixing is mainly a financial risk, with very large administrative fines, while the criminal line is crossed by bid rigging and related offences. Companies should treat a cartel as both a compliance problem and a potential personal-liability problem for executives.

FAQ

Q: Is price fixing a crime in China?

A: In most cases no — it is an administrative violation under the Anti-Monopoly Law, not a criminal offence.

Q: What is the fine for price fixing in China?

A: Under Article 56, an order to stop, confiscation of illegal gains and a fine of 1% to 10% of the previous year’s sales, or up to RMB 5 million if there were no sales.

Q: Can individuals be penalized for price fixing?

A: Yes — responsible individuals such as the legal representative can personally be fined up to RMB 1 million.

Q: When does price fixing become a crime?

A: When it takes a criminal form, most clearly bid rigging, which is a crime under Article 223 of the Criminal Law.

Q: What is the punishment for bid rigging?

A: Up to three years’ imprisonment or criminal detention, plus a fine.

Wang Guan | Co-founder, Beijing Haolue Law Firm | +86 17813108512