On Sept. 10, 2014, Shaanxi High People's Court made a final decision upholding the first instance ruling by Xi'an Intermediate People's Court dismissing claims by Xianyang Huaqin Taxi Service Co., Ltd. (Huaqin) against Xianyang Qindu Taxi Transport Service Branch (Qindu), Xianyang Weicheng Taxi Transport Service Branch (Weicheng), Xianyang Huaguang Taxi Transport Service Branch (Huaguang), Xianyang Public Transport Group Company (Public Transport) and Xianyang City Transport Management Department (Management Department) for abuse of market dominance. Similar first and second instance decisions were made in a similar case that was separately filed by Xianyang United Transport Service Co., Ltd. (United) against the same defendants.
The so-called Three Branches (Huaqin, Qindu, and Weicheng) were collectively owned enterprises originally set up by Management Department in 1995 and were transferred to Public Transport in 2011. Management Department is an administrative agency responsible for taxi transport management and issuing transport operation licenses. The plaintiffs alleged that the Three Branches had contracted with 950 (out of the total 1,153) individual taxi drivers in Xianyang urban area for a long period of time; thus individual taxi drivers were deprived of the rights to choose service companies, and the plaintiffs were excluded from the competition with the Three Branches for providing services to the individual taxi drivers.
The first instance decision concluded that the relevant market should be defined as the taxi service market in Xianyang urban area; that the Three Branches do not possess the ability to control the service fee and the number of the taxi cars; and that they do not have the ability to prevent or exert an influence on the access of others to the taxi service market.
The Shaanxi High Court's decision to dismiss the claims appears to have been mainly based on the fact that the appellant (the plaintiff in the first instance) could not prove the existence of relevant market. The appellant defined it as the Xianyang urban area individual taxi driver service market in the complaint, but changed it to the Xianyang city taxi (including company taxi and individual taxi) service market. The business licenses of the appellant and the appellees did not indicate the portion of the market where competition exists; thus, no sufficient grounds were presented by the appellant to clearly define the relevant market.
The Shaanxi High People's Court's Decisions are available here and here.
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