Top court pushes for protection of fair competition

China's top court has reaffirmed the importance of maintaining fair competition in the market, urging courts at all levels to intensify efforts in combating activities such as counterfeiting, trademark infringements and damaging business reputations.

In a statement released on Monday, the Supreme People's Court highlighted eight landmark cases affecting fair competition.

"These unfair practices not only hinder innovation and honest business operations but also infringe upon consumer rights and public interests," the statement said.

One case occurred in the automotive sector, involving a Shanghai-based information technology company and three enterprises registered in Beijing. The Shanghai company owns a trademark featuring the Chinese character for "tiger "related to car maintenance.

In September 2023, after launching a low-price marketing campaign for their car maintenance products and services, the three Beijing companies were sued in Shanghai's Minhang district.

The Shanghai firm alleged that the defendants used the phrase zhenhujia, or "shocking tiger price", in advertisements implying significant discounts.

The plaintiff also said the defendants' promotional videos and articles showed images of car maintenance workers depicted as tigers holding products marked with the "tiger" character in a font identical to the Shanghai company's trademark.

Netizens' comments under the online posts included remarks such as, "Is this meant to intimidate Shanghai's 'tiger'?" and "Even though it doesn't mention Shanghai's 'tiger' directly, it's clearly referring to it."

The Shanghai company argued the competitors' actions harmed its rights and interests. It sought an injunction against the infringements and demanded 5.3 million yuan ($743,070) in damages.

The district court concluded that the three Beijing companies fabricated and disseminated false and misleading information, portraying the Shanghai company as a disreputable player in the market. The court said the actions damaged the competitor's business and product reputation and constituted unfair competition.

The top court said the case was a textbook example of regulating commercial disparagement.

"The ruling accurately defined the limits of lawful advertising practices and correctly identified the unfair competition behavior of belittling competitors," it said.

While underscoring the need to prevent the spread of misleading content and actions that damage others' business reputations, the court also stressed the importance of effectively handling such disputes, saying the approach serves as a model for protecting fair market participation amid the rapid growth of the internet platform economy.

Through the disclosed cases, the court urged judges nationwide to pay closer attention to unfair competition lawsuits involving new technologies and emerging industries, striving to maintain industrial order and promote healthy development in these areas.