China’s Eastman Case: A Non-Exclusive View on Exclusive Dealing?

By Michael Han, Bryan Fu & Christoph van Opstal

In early 2019, China’s antitrust authority found that Eastman China abused its dominance in the market for CS-12 coalescent. The Eastman case demonstrates that certain trading restrictions such as most-favored-nation clauses will not fall foul of China’s Anti-Monopoly Law in isolation but may raise concerns in aggregation and on a case-by-case basis where they together can be classified as measures to achieve exclusivity in the context of dominance. The measures canvassed in the Eastman case included the adoption most-favored-nation clauses, minimum purchase obligations, and loyalty rebate schemes, which were found to be tantamount to exclusive dealing, given their purpose to lock-in customer demand which had the effect of foreclosing competitors. This article provides an overview and some key takeaways from China’s Eastman case.