Asean-Competition policy, guidelines and law (Business Mirror (Philippines))

LAUNCHING the Asean Regional Guidelines on Competition Policy in 2010, Dr. Surin Pitsuvan, then-secretary-general of Asean, said it is a pioneering attempt to achieve the stated goal of ensuring Asean as a highly competitive region envisaged in the Asean Economic Community [AEC] Blueprint, in particular the introduction of nationwide competition policy and law by 2015.

The guidelines are based on country experiences and international best practices with the view to creating a fair competition environment in Asean. It seeks to enhance and expedite the development of national competition policy within each Asean member-state.

Objectives of regional guidelines

The AEC Blueprint which each Asean member-country shall abide by and implement by 2015. The AEC Blueprint will transform Asean into a single market and production base, a highly competitive economic region, a region of equitable economic development, and a region fully integrated into the global economy;

To fulfill the goal of a highly competitive economic region, one of the action tasks identified under the AEC Blueprint is to develop regional guidelines on competition policy; and

To create an official body comprising representatives from the competition authorities and agencies responsible for competition policy in the Asean member-states. The Asean Experts Group on Competition coordinates the implementation of competition policies in Asean.

Purpose and benefits of regional guidelines

The regional guidelines serve as a general framework guide for the Asean member-states as they endeavor to introduce, implement and develop competition policy in accordance with the specific legal and economic context in each country.

The guidelines endeavor to help in the process of building stronger economic integration in the region, by acting as a common reference guide for future cooperation to enhance the competitive process in the Asean member-states. It is important to note that the guidelines serve only as a reference and are not binding on the member-states.

The guidelines take into account the varying development stages of the competition policy in the member-states.

Definition of competition policy

Competition policy can be broadly defined as a governmental policy that promotes or maintains the level of competition in markets, and includes government measures that directly affect the behavior of enterprises and the structure of industry and markets.

Main objectives and benefits of competition policy

The most commonly stated objective is the promotion and the protection of the competitive process. Competition policy introduces a level playing field for all market players that will help markets to be competitive. It will set rules of the game that-in the end-protects the consumer of products and services.

The scope of the policy includes:

Prohibition of Anti-competitive Agreements

Prohibition of Abuse of a Dominant Position

Prohibition of Anti-competitive Mergers

The regional guidelines can be downloaded from www.asean.org.

In the Philippines, good progress has been made: Executive Order 45 created the Office for Competition under the Department of Justice; bills have been introduced in both Houses of Congress, have been approved a few days ago in both Houses and are now heading for Bicam-there is justified hope that legislation can be finalized soon. Both bills foresee the creation of an independent Competition Commission; surprisingly, the Office for Competition issued guidelines for the implementation of competition laws recently; it will have to be seen how these guidelines interact with the internal rate of return to be drawn up the Competition Commission once the law has been signed by the President.

The guidelines drawn up by the Office of Competition have raised a number of concerns by European companies; for instance, European companies that have exclusive distributorship agreements do not want to have them undermined by the competition guidelines, as they encourage parallel imports which would raise security, safety and intellectual property right issues.

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