SAMR imposed a 1.75 million yuan fine on a state-owned construction company for unlawfully implementing a concentration before obtaining regulatory approval.
China’s top merger-control regulator has fined a state-owned construction company for gun-jumping, marking the first enforcement action taken under the country’s newly issued guidelines for penalty discretion in merger-control violations.
The State Administration for Market Regulation, or SAMR, announced yesterday that it had imposed a 1.75 million yuan ($244,018 ) fine on Guangzhou Municipal Construction Group for unlawfully implementing a concentration before obtaining regulatory approval.
According to the decision, Guangzhou Construction signed a share-purchase agreement on Dec. 15, 2023, to acquire a 51 percent stake in Guangdong Hongye Investment Development Group from its parent company, Hongye Electric Power.
The deal was shortly afterward submitted to SAMR for antitrust review on Dec. 20. However, just one day later — before SAMR had officially accepted the filing — the parties completed the equity transfer and registered the ownership change on Dec. 21.
SAMR found the conduct to be in violation of Article 30 of the Antimonopoly Law, or AML, which prohibits implementing a concentration prior to receiving formal clearance, following an investigation launched on Aug. 1, 2024.
While the official penalty decision cited the AML and the Administrative Penalty Law as the legal basis for the fine, an accompanying explanatory article published by SAMR’s official media outlet also referenced the trial benchmarks for determining administrative penalties on illegal business concentrations — a set of merger penalty guidelines released in March 2025 and effective immediately upon issuance.
SAMR said in the decision that the transaction did not have anticompetitive effects and concluded that the case did not involve any aggravating circumstances that would warrant a more severe penalty.
Under the benchmarks, the baseline fine for gun-jumping cases without anticompetitive impact is set at 2.5 million yuan. This amount may be reduced in 10 percent increments based on specifically enumerated circumstances, such as first-time violations or demonstrated compliance efforts. The final fine must not fall below 40 percent of the baseline.
In Guangzhou Construction’s case, SAMR determined that the company, along with its affiliates, had no prior history of merger violations, had fully cooperated with the investigation by truthfully providing information and had established and effectively implemented an internal antitrust-compliance program.
These factors apparently led to a 30 percent reduction, resulting in the final fine of 1.75 million yuan.
The enforcement reflects SAMR’s evolving approach to merger control — placing greater emphasis on procedural compliance and using structured, codified criteria to determine penalties with consistency and proportionality.
China’s merger control regime has become significantly more stringent since amendments to the Anti-Monopoly Law took effect in August 2022.
Under the revised law, SAMR may impose fines of up to 10 percent of a company’s annual revenues for anticompetitive deals. For unlawful transactions that do not harm competition, the cap was raised to 5 million yuan.
By comparison, AML previously stipulated a maximum fine of 500,000 yuan for gun-jumping cases.
The penalty guidelines now provide a clearer roadmap for how SAMR evaluates merger violations and calculates fines — offering businesses greater predictability.
Source: MLex
