China's top court flags antitrust risks in non-compete clauses in certain circumstances
By MLex Staff ( September 12, 2025, 06:59 GMT | Insight) -- A ruling by China’s top court has spotlighted how non-compete clauses in supply contracts can violate antitrust law when used in dual-distribution scenarios — where a manufacturer acts as both supplier and competitor to its distributor — due to their potential horizontal competitive effects. The decision invalidated a clause that prohibited a chemical manufacturer from selling to its distributor’s downstream clients. The key significance of the case lies in breaking habitual assumptions and re-examining the possibility that horizontal monopolistic conduct may arise even under dual-distribution models.A ruling by China’s top court has spotlighted how non-compete clauses in supply contracts can violate antitrust law when used in dual-distribution scenarios — where a manufacturer acts as both supplier and competitor to its distributor — due to their potential horizontal competitive effects....
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