UPDATE 1-China plans new competition, food watchdog in government revamp

* New agency will take antitrust roles three regulators how play

* Food safety is hot button social issue after series of scandals

* China plans seven new ministries in government shake-up (Updating throughout)

BEIJING, March 13 (Reuters) - China will form a powerful new competition and food safety regulator in a bid to ramp up oversight of mergers and acquisitions and price-fixing as the world's second-largest economy seeks to make policymaking more efficient.

In much-anticipated plans to create seven new ministries and a raft of government agencies announced on Tuesday, one of the most significant changes is creation of the national markets supervision management bureau.

The new body will decide on antimonopoly and pricing issues, replacing the roles played by the three national antitrust regulators: the National Development & Reform Commission (NDRC), the Ministry of Commerce and the State Administration for Industry and Commerce (SAIC).

The new bureau "will undertake unified antitrust enforcement and standardise and safeguard market order" among other duties, China's State Council, or cabinet, said in a proposal submitted to the annual parliament session.

The proposal is certain to be approved before the session ends on March 20.

Unifying the structure under one new agency, rather than handing responsibility to one of the three existing watchdogs, could reduce infighting over antitrust issues, which is increasingly important for the government to resolve.


The restructuring comes as President Xi Jinping vowed to make the economy more responsive to market forces and shift to consumer-focused investment from a state-led model.

The new agency will also take control of most functions now performed by the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) as well the China Food and Drug Administration.

AQSIQ's role as quality controller for imports and exports will transfer to customs, the cabinet proposal said.

According to experts, the changes are another sign the government wants to better coordinate regulation and enforcement of food safety, a hot-button social issue after a series of scandals in recent years involving contaminated milk powder and recycled cooking oil.

But even with the new structure, regulatory power may still be split with the newly-expanded Agriculture and Rural Affairs Ministry remaining in charge of ensuring the farm produce quality, said Erlend Ek, a Beijing-based agriculture and trade research manager at China Policy, a consulting firm.

"China is clearly on the way to creating a single (food safety) agency, but it's not clear if they've done it now," Ek said. (Reporting by Josephine Mason, Michael Martina and Dominique Patton; Editing by Richard Borsuk)