Competition Law in Publishing Print Run Coordination in China

1. Introduction

Publishing print run coordination refers to arrangements among competing publishers, printing companies, or book distributors concerning the number of copies to be printed, the timing of print runs, reprinting decisions, or the allocation of printing capacity. Such coordination can be commercially legitimate, but it may violate China's competition law when it is used to restrict competition.

For example, competing publishers may agree that each will print only a fixed quantity of a popular textbook, or that no publisher will reprint a particular title until a competitor has sold its existing stock. The competition concern is that such an agreement may reduce supply, maintain higher prices, or prevent competitors from expanding.

The central legal distinction: Coordinating the production of a book is not automatically unlawful. The relevant question is whether the arrangement restricts or eliminates competition, and whether it falls within a prohibited monopoly agreement or another unlawful conduct under Chinese law.

2. Applicable legal framework

A. Anti-Monopoly Law of China

The principal statute is the Anti-Monopoly Law of China (AML), enacted in 2007 and amended in 2022. The provisions most relevant to print run coordination are:

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Provision

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Relevance

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Article 3

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Identifies monopoly agreements, abuse of dominance, and anti-competitive concentration as the principal categories of monopoly conduct.

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Article 17

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Prohibits agreements between competing undertakings that restrict competition, including fixing or changing prices, restricting output or sales, dividing markets, and other prohibited forms of coordination.

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Article 18

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Regulates vertical monopoly agreements, including resale-price restrictions.

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Article 19

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Addresses the organisation of monopoly agreements and assistance in forming them.

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Article 20

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Provides exemptions for certain monopoly agreements where statutory conditions are satisfied.

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Article 46

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Provides penalties for monopoly agreements and related violations.

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The 2022 amendments also strengthened the treatment of agreements facilitated by technology, making the AML relevant to digital publishing platforms and algorithmic coordination in addition to traditional printing.

B. Regulations on the Administration of Publications

China's publication administration rules are separate from competition law. They govern publishing, printing, and distribution activities, including licensing requirements and restrictions on unauthorised printing. A print run may therefore raise both regulatory and competition-law issues, but a licensing violation is not, by itself, proof of a cartel.

WIPO

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C. Relevant market

A competition investigation must identify the market affected by the arrangement. Possible markets include:

Printing services for textbooks or educational materials.

Printing services for commercial books.

Wholesale distribution of books.

Retail sales of books.

A specialised market for a particular title or category, where the evidence supports that definition.

The relevant market depends on substitutability, the geographic scope of competition, and the commercial circumstances. A restriction affecting a small specialised printing market may have different effects from one affecting the national supply of textbooks.

3. How print run coordination can violate competition law

3.1 Direct output restriction

A group of competing publishers agrees to limit the number of copies of a book that each will print. This may amount to an output restriction under Article 17 if the purpose or effect is to limit competition.

For example, five publishers competing to supply school textbooks agree that each will print no more than 20,000 copies per edition. The arrangement may restrict total supply and reduce the competitive pressure to offer lower prices.

The legal analysis considers:

Whether the parties are actual or potential competitors.

Whether the agreement restricts output or sales.

Whether it has an anti-competitive purpose or effect.

Whether a statutory exemption is available.

3.2 Coordinated reprinting and artificial scarcity

Reprinting is often a competitive response to demand. Publishers that independently decide to print additional copies may compete for readers and retailers. An agreement to delay reprinting can have the opposite effect.

Suppose a successful novel is sold by several competing publishers under different publishing rights. If they agree not to reprint until existing stock is exhausted, the arrangement may restrict supply and protect existing prices.

However, a publisher's unilateral decision to delay reprinting because of weak demand, limited cash, or excess inventory is not automatically a monopoly agreement. The existence of communication or similar commercial decisions alone is insufficient to establish an infringement.

3.3 Print run coordination through an industry association

A publishing association may legitimately discuss printing standards, paper quality, or technical efficiency. The legal risk increases where the association instructs members to:

Maintain a common print quantity.

Avoid printing competing titles beyond an agreed limit.

Delay reprints collectively.

Exchange confidential information about planned output or sales.

Allocate customers or titles among members.

The relevant legal principle is that an association's involvement does not make otherwise prohibited coordination lawful.

3.4 Coordination involving printers and publishers

A printer may serve several competing publishers. Ordinary commercial dealings, such as agreeing on a price for a printing contract or reserving capacity, are generally different from a horizontal agreement among competing publishers.

The risk arises if the printer becomes a conduit for competing publishers to exchange sensitive information or enforce an agreement to limit output. Article 19 is relevant where a third party organises or assists monopoly agreements.

4. At least 6 relevant Chinese case laws

The following cases provide legal principles applicable to print run coordination. They are not all cases in which a court specifically adjudicated an agreement to coordinate the print run of books. China has relatively limited publicly accessible judicial material on this exact fact pattern. The distinction between direct precedent and analogous authority is important.

Case 1: Zhejiang White Packaging Paper Industry Association Pricing Case

Nature: Administrative enforcement concerning competing paper manufacturers.

Facts and legal issue: An industry association in Zhejiang brought together more than 20 members to discuss ex-factory pricing of white packaging paper. The authorities treated the conduct as a horizontal pricing arrangement and imposed a fine on the association.

Competition principle: Industry associations must not become vehicles for coordinating prices among competitors.

Relevance to publishing print runs: Paper is a critical input in book printing. A similar arrangement among publishers concerning the price of printed books or the number of copies each publisher will produce could raise the same horizontal coordination concerns. The paper case does not establish that any discussion of print quantities is unlawful.

Source: Reported in an overview of Chinese anti-competitive conduct involving NDRC and SAIC officials.

JDSupra

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Case 2: Publishing Association Resale-Price Restrictions Case

Nature: Administrative enforcement involving book publishing companies.

Facts and legal issue: An association of book publishing companies required members to observe resale-price restrictions, including a rule that newly published books should not be discounted during the first year and that discounts should not fall below 85% of the price printed on the colophon page. The NDRC required the removal of those restrictions.

Competition principle: A publishing association cannot use coordinated rules to restrict downstream price competition.

Relevance to print run coordination: If publishers agree on output limits to maintain a common price level, the arrangement may involve both output restriction and price coordination. The association case demonstrates that the publishing sector is subject to competition scrutiny; it does not itself concern coordinated print quantities.

Source: The enforcement example is described in the same official-related competition enforcement overview.

JDSupra

Case 3: Sursen v. Shanda and Xuanting

Nature: Private antitrust litigation in China's online literature sector.

Facts and legal issue: Sursen alleged that Shanda and Xuanting abused a dominant position by restricting authors of the Star Change Sequel from publishing their work on Sursen's Reading Bar platform. The claim concerned exclusive dealing and the restriction of access to competing online literature distribution.

Competition principle: Exclusive arrangements may raise abuse-of-dominance concerns where a dominant undertaking restricts competing distribution channels and the statutory requirements are met.

Relevance to print run coordination: A dominant publishing or distribution platform that uses control over printing capacity or access to printing services to prevent competing publishers from supplying books could face analogous issues. The case is not evidence of a coordinated print run and does not establish dominance in the physical printing market.

Source: The case and its allegations are discussed in a study of abuse of market dominance under China's AML.

ResearchGate

Case 4: Commentary on the Three Kingdoms Book Cover Case

Nature: Unfair competition litigation involving book publishing.

Facts and legal issue: Shanghai Literature and Art General Publishing House sued over a competing book whose name, cover design, size, and layout were alleged to resemble its successful publication. The court considered whether the competing book created confusion with a well-known commodity.

Competition principle: Competition law also protects against certain forms of misleading imitation and confusion in commercial presentation. This is distinct from an agreement to restrict output.

Relevance to print runs: A coordinated print run may involve both supply restriction and an attempt to preserve a competitor's commercial position. The book cover case is useful for distinguishing unfair competition based on market confusion from an antitrust agreement concerning production quantities.

Source: Shanghai's official summary of the case records the competing books' similarities and the court's reasoning.

sipa.sh.gov.cn

Case 5: China Youth Publishing House Book Cover Case

Nature: Unfair competition litigation involving publishing, printing, distribution, and retail.

Facts and legal issue: China Youth Publishing House brought a dispute involving a competing book whose title and cover design were alleged to imitate a well-known publication. The case involved publishers, distributors, a printing company, and several retailers. The court considered the parties' competitive relationship, the characteristics of the book, and the evidence of actual printing volume.

Competition principle: A publisher's rights and commercial interests can be evaluated within the competitive relationship between publishing businesses. Evidence concerning print quantities can be relevant to damages, but it does not by itself prove an output cartel.

Relevance to print run coordination: The case illustrates the importance of identifying the actual printing volume and the role of each participant. In a print run coordination investigation, documents showing print orders, production quantities, and distribution arrangements may be relevant to determining the conduct and its effects.

Source: The judgment summary discusses the 23,150-copy printing quantity and the court's assessment of the evidence.

CIP Lawyer

Case 6: Guangxi “4·02” Cross-Provincial Counterfeit Textbook and Teaching Material Case

Nature: Criminal enforcement involving illegal publishing, printing, and distribution.

Facts and legal issue: The Guangxi case involved the production and sale of counterfeit textbooks and teaching materials. Authorities reported that more than 500,000 books were seized, and the case resulted in convictions for copyright infringement and illegal business operations.

Competition principle: Illegal printing and distribution may be subject to criminal and publication-related sanctions. These are separate from the AML's treatment of agreements between competitors.

Relevance to print run coordination: The case helps distinguish unlawful printing activity from a lawful or unlawful agreement between competitors about output. A publisher cannot rely on competition-law concepts to legitimise unlicensed printing or counterfeit production.

Source: The National Copyright Administration's case report describes the investigation and convictions.

Copyright Admin China

5. Legal analysis of a hypothetical print run cartel

Consider the following scenario:

Three large publishers dominate a specialised textbook market. They agree to print 10,000 copies each of a popular title and to refrain from additional printing for six months, even if demand increases.

Print run coordination

Hypothetical

Three competing publishers

10,000

Copies

10,000

Copies

10,000

Copies

Agreed total output: 30,000 copies

The restrictive element

The publishers agree not to reprint even if market demand increases. That is the potential output restriction, rather than the mere fact that each publisher prints 10,000 copies.

Application of Article 17

The principal issue is whether the agreement is a horizontal monopoly agreement that restricts output or sales. The fact that all three undertakings compete in the same market supports the horizontal nature of the arrangement.

The authority would need to examine the agreement, its purpose, and the relevant statutory conditions. If the conduct is found to be a prohibited monopoly agreement, the parties may face administrative penalties.

Effect on consumers

Potential effects include:

Higher prices due to reduced supply.

Delayed availability of educational materials.

Fewer choices for students, teachers, and retailers.

Reduced incentives for publishers to improve quality or offer discounts.

These are possible effects, not findings that every print run arrangement produces.

Possible lawful explanation

If each publisher independently limits its print run because of expected demand, production costs, or unsold inventory, there may be no agreement between competitors. The legal analysis must distinguish independent business decisions from concerted conduct.

6. Economic assessment

Print run coordination can affect several dimensions of competition.

How coordination can affect competition

Supply

Potential restriction

Agreed limits may reduce total copies available.

Price competition

Possible impact

Artificial scarcity may reduce incentives to discount.

Innovation and variety

Possible impact

Restrictions may discourage new editions and competing titles.

Illustrative risk indicators, not measured market data or case outcomes.

Market power and output restriction

The existence of a cartel can be problematic even if the participating publishers do not individually possess a dominant position. Monopoly agreements and abuse of dominance are separate categories of conduct under the AML.

However, the exact legal classification depends on the agreement, the parties, and the applicable statutory provisions. The market impact may also be relevant to the assessment of the conduct and any available exemptions.

7. Defences and legitimate coordination

A. Independent production decisions

Publishers can independently choose their print quantities based on commercial forecasts. Similar print quantities do not automatically establish collusion.

B. Genuine production efficiency

An agreement involving a printing service may be legitimate where it genuinely improves efficiency, reduces waste, or enables production that could not reasonably be achieved independently. The parties would still need to consider whether the arrangement falls within the AML's prohibited agreements or statutory exemptions.

C. Statutory exemptions

Article 20 of the AML provides for certain exemptions, subject to statutory conditions. A party cannot assume that a production-related agreement is exempt merely because it claims to improve efficiency.

D. Joint publishing or co-printing

A genuine joint venture or co-printing project may involve shared investment, technical capacity, and risk. It is not necessarily the same as competitors agreeing to limit their independent production. The legal analysis depends on the substance of the arrangement.

8. Enforcement and penalties

Under China's AML, prohibited monopoly agreements may result in administrative fines and other statutory consequences. Article 46 is relevant to penalties for monopoly agreements.

For print run coordination, the evidence that may be relevant includes:

Written agreements, emails, or meeting minutes.

Common instructions concerning print quantities.

Communication through publishing associations.

Print orders and reprinting records.

Agreements allocating titles, customers, or printing capacity.

Evidence of coordination involving printing contractors.

A regulator may distinguish between a genuine commercial collaboration and a scheme to restrict competition. The nature of the agreement and the evidence of its operation are central.

9. Conclusion

Competition law in China's publishing industry applies to the coordination of print runs where the arrangement may restrict competition. A collective agreement among competing publishers to limit output, delay reprinting, or allocate printing capacity may raise Article 17 concerns under the Anti-Monopoly Law.

The six cases discussed above provide relevant principles from Chinese competition enforcement, publishing litigation, and illegal printing enforcement. They should be used with care: the reported cases do not establish a direct judicial rule that every agreement about book print quantities is unlawful.

The most important legal distinction is between independent production decisions or genuine efficiency-enhancing cooperation and an agreement among competitors designed to restrict output, sales, or competitive supply.