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ARTICLE · 05 JANUARY 2026

China Introduces The Block Exemption For Vertical Constraints

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For any prohibited non-price restraints, the exemption will apply if the business can prove that during each year of the vertical agreement, each the business and its counterparty has a share below 15% in the relevant market...

United StatesAntitrust/Competition Law
Philip Ruan
Philip Ruan
Dawn (Dan) Zhang
Dawn (Dan) Zhang

On Dec. 19, 2025, the State Administration of Market Regulation of China (SAMR) published the amended Measures on Prohibition of Monopoly Agreements (Amended MPMA) clarifying the long-expected conditions under which a vertical agreement containing restraints on competition (i.e., a vertical restraint) may be exempted from the prohibition under China's Anti-Monopoly Law (AML). The Amended MPMA will take effect on Feb. 1, 2026.

Article 18 of China's AML prohibits vertical constraints such as resale price maintenance (i.e., fixing the resale price or setting the minimum price for resale), and certain non-price restraints as specified by SAMR in a "vertical" agreement – an agreement between businesses operating at different levels of the supply chain (e.g., manufacturers and distributors). Article 18 also contains a safe harbor rule exempting the vertical constraint if a business and its counterparty in a vertical agreement can prove, among other conditions, that their

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