Illustration: Lu Ting/GT

Northern China's Hebei Province has recently removed a rule that favored local vehicles by charging half the normal toll fee to local transportation companies. The move was prompted by an antitrust investigation from the National Development and Reform Commission (NDRC), one of China's antitrust regulators for price fixing.

The South Korean Embassy in China recently complained to the NDRC that Hebei halved the toll fee exclusively for local transportation companies, leaving out a Sino-South Korean joint venture in Tianjin. An NDRC official said last week that local government agencies in Hebei were suspected of issuing discriminatory policies and had been asked to correct their practices.

It is unclear whether the problem was resolved so quickly because it was brought up by the South Korean Embassy in China. But the case marks significant progress in China's enforcement of its six-year-old antitrust law. It was the first case to target provincial government agencies that the NDRC publicly announced.

Hebei's case sends a message that China will extend anti-monopoly investigations to government agencies, just as Xu Kunlin, the head of the NDRC's anti-monopoly bureau, was quoted by media as saying Saturday that the focus of antitrust investigations will shift to abuse of administrative power, competitive exclusion and local protectionism.

Since it introduced the Anti-Monopoly Law in 2008, China has continuously gone after offenders including private firms, multinationals and a limited number of State-owned enterprises (SOEs).

But these investigations were mainly focused on the monopolistic practices of businesses. Governments at various levels and government agencies are virtually immune to investigations into administrative monopolies, in which government agencies impede market competition.

Administrative monopoly is a byproduct of China's planned economy, in which the State controlled almost every part of the economy. China's Anti-Monopoly Law prohibits government agencies or entities from abusing their administrative power by applying discriminatory standards for fee collection, restricting nonlocal products from entering the local market or preventing nonlocal businesses from investing or setting up branches in local markets.

However, few government agencies and entities have been investigated, let alone punished, since the law took effect.

In a rare case, when the Anti-Monopoly Law first went into effect on August 1, 2008, four companies in Beijing filed a lawsuit accusing the General Administration of Quality Supervision, Inspection and Quarantine, the country's quality control watchdog, of violating antitrust law by requiring businesses to use the services of an electronic supervision website run by a technology company. But the court dismissed the case on the grounds that the lawsuit exceeded the proceedings deadline. Thus, the very first lawsuit against an administrative monopoly was aborted.

The difficulty in enforcing the law against administrative monopolies lies in the pressure from the consequences in challenging government entities. Compared with business monopolies, which can be easily identified and punished, administrative monopolies can cause greater harm to market operation due to the wider scope of their existence.

Administrative monopoly penetrates nearly all areas of the economy where administrative power is involved. Many local governments arbitrarily set up barriers to restrict nonlocal companies from bidding on local projects, preventing them from competing in local markets.

On a broader scope, many sectors of the economy, including energy, telecommunications, banking and railways, remain dominated by SOEs, which monopolize resources and limit market competition.

In November 2013, China's leadership decided to allow the market to play a decisive role in allocating resources.

Hebei's case marks a victory in law enforcement that aims to let the market play a bigger role in the economy.

That said, it does not mean the end of the battle against monopolistic practices, but a beginning of an even harder battle to challenge administrative authorities. Many questions still remain unanswered. Why was Hebei's case brought up by a foreign embassy? Could it have been resolved so quickly if the complaint had not come from a foreign embassy? The fact that antitrust enforcement against government agencies remained dormant for a long time after the antitrust law took effect shows there is not a smooth channel for lodging such complaints.

If the investigation of administrative monopolies could be normalized, as it is with businesses, and the information on such investigations is completely transparent, foreign firms will feel less worried that the ongoing antitrust battles are unfairly targeting them.

The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn