Supreme Court hears monopoly case between Qihoo and Tencent
Antivirus software company Qihoo is seeking compensation of 150 million yuan from Tencent
The mainland's People's Supreme Court is expected to make a landmark decision after a hearing a monopoly dispute between two internet giants.
In the first lawsuit of its kind, a hearing was held yesterday on a case between antivirus software developer Qihoo 360 Technology and the mainland's largest internet company, Tencent. Qihoo claims Tencent has engaged in monopoly practices and is demanding compensation of 150 million yuan (HK$190 million). The court said it would give its verdict at a later date.
This is the first time the highest court in the land has handled an anti-monopoly case in the internet industry. Lawyers said the hearing itself shows progress in the mainland's legal system.
"It signals the Supreme Court is open to cases from the internet sector and it tells enterprises in the industry that they have the right to sue big firms. Eventually this will protect and encourage competitiveness in the market," said Yao Kefeng, a lawyer at Beijing Deheheng Law Firm.
Yao says the verdict is hard to forecast but says Tencent is clearly a monopoly enterprise, "especially in the instant messaging business".
Monthly active users on Tencent's popular instant messaging platform QQ reached 816 million as of the end of September.
"I believe this is a fact that nearly all internet users agree on. However, whether the law will recognise it as a fact depends on the evidence," Yao said.
He said to prove monopoly, a lot of data and statistics would have to be collected and presented to the court. "The difficult part is to validate this data."
In March, the Guangdong People's High Court heard the same case and ruled that Tencent did not abuse its dominant market position to hurt Qihoo's business. Qihoo appealed the decision in the Supreme Court.
Yao said the Guangdong hearing was unfair. "It shows strong characteristics of regional protectionism."
Tencent is based in Shenzhen, while Qihoo is in Beijing.
Yu Guoqiang, a lawyer at Beijing Shengfeng Legal Affairs Firm, said a second hearing could not be ruled out. "The case involves a huge amount of materials and a large amount of compensation. The Supreme Court will be very careful when making a decision."
