During China’s Two Sessions this year, Lan Minbo, CPPCC member from the East China University of Science and Technology, submitted a proposal targeting the chaotic situation in the current scientific instruments maintenance market.

   The current scientific instrument maintenance market is subject to serious monopolies and an extreme lack of competition. Some suppliers abuse their dominant market position by setting unfair prices or business terms, resulting in a loss of research funds by the government and procurement entities while at the same time impeding the progress of scientific research projects. As a consequence of this state of affairs, responsive antitrust measures are urgently needed to promote the healthy development of the scientific instrument maintenance market”, the proposal stated. Meanwhile, some suppliers have taken advantage of their dominant market position to reap windfall profits by improper means such as arbitrary price increases, lowered service standards, exclusion of third-party suppliers from the market, and the imposition of a mandatory “replacement instead of repair” policy. According to publicly available statistics, the maintenance income of certain suppliers has not only exceeded 30% of total domestic sales revenue but has been growing year after year.

The proposal advises the initiation of antitrust investigations of suppliers suspected of abusing their dominant market position and who have exerted an adverse impact on the scientific instruments industry. It also urges the competent authorities to update applicable statutes and regulations by (i) amending legislation to strengthen antitrust efforts in the scientific instrument industry and to enhance purchaser protection, (ii) establishing an effective system to open up the scientific instrument maintenance market by allowing and encouraging the entry of third-party enterprises into the market, and (iii)  enforcing regulatory requirements through the establishment of a price negotiation mechanism.

(Source: Antitrust Review)