I ATTENDED a recent advocacy roadshow in Baguio conducted by the Philippine Competition Commission and I learned many things about Republic Act No. 10667 or Philippine Competition Act which was signed into law on July 21, 2015 that accordingly languished in Congress for 24 years.
According to the PCC officials who are mostly lawyers, said Act is meant to ensure efficient and fair market competition among businesses engaged in trade, industry, and all commercial economic activities. It likewise prohibits anti-competitive agreements, abuses of dominant positions, and mergers and acquisitions that limit, prevent, and restrict competition as that of a cartel. The R.A. is the primary authority for competition policies for promoting and protecting competitive market in the country. It protects the well-being of consumers and preserve the efficiency of competition in the marketplace. It is said to be a game changing legislation that is expected to improve consumer protection and help accelerate investment and job creation in the country, consistent with the national government’s goal of creating more inclusive economic growth. Enforcement of this law will help ensure that markets are open and free, challenging anti-competitive business practices while maintaining an environment where businesses can compete based on the quality of their work.
A competitive market means a market with multiple buyers and multiple sellers, driving market prices lower and offering consumers more choices. A truly competitive market encourages efficiency and innovation, and forces businesses to excel. The act reflects the belief that competition promotes entrepreneurial spirit, encourages private investments, facilitates technology development and transfer and enhances resource productivity.
At the roadshow, the PCC lawyers explained that complaints that affect public interest and other reasonable grounds such as abuse of dominant position are among the tasks that they handle. The PCC issues administrative fines to erring entities with criminal acts relating to unfair competition, anti-competitive agreements and abuse of dominant positions.
On why these should be prohibited, the lawyers pointed out that in essence, healthy competition ensures that no single entity controls the price of commodities and this can lead to lower prices and higher quality of products as businesses strive for efficiency and increased market share.
Commonly known as cartel, these are businesses conniving to manipulate the market to their advantage which can cause significant harm to consumers by engaging in coordinated anti-competitive behavior such as price-fixing, bid-rigging, output restriction, and market allocation. The penalties for violating the PCA can be very severe. Aside from fines reaching up to hundreds of millions of pesos, owners and employees of businesses involved in anti-competitive behavior may also face jail time. The PCC’s leniency program is designed to deter the creation of cartels, and to aid in the detection and prosecution of existing ones. This is done by incentivizing cooperation from current and former cartel participants who possess information and/or evidence necessary for a successful investigation and case.
According to the Leniency Program, participants in an anti-competitive agreement like a cartel can avail an immunity from suits and administrative or criminal liabilities arising from the Philippine Competition Act if they signify to cooperate with the PCC. There is a marker system which secures an applicant’s position in the queue for leniency while evidence is being gathered. The applicant can be granted immunity from suits if he or she qualifies in providing relevant information of participation to an anti-competition act.
The PCC appeals in their website that “if you suspect that any business, company, or organization is behaving anti-competitively, and such behavior may constitute a possible violation of the PCA, kindly file a verified complaint with the PCC. A verified complaint contains a statement that the complainant files a complaint and that he/she read the allegations and verified that these allegations are true to the best of his/her knowledge and can be supported by records.”
The PCC also welcomes helpful information from the public and cautions everyone to report to PCC by calling 7719 722 or via email at email@example.com if they encounter any business that is behaving in an anti-competitive manner.