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Friday August 17, 2018

Building stronger culture of competition pushed

THE Philippine Competition Commission (PCC) is pushing for building a stronger culture of competition in the country through engaging the public in countering anti-competitive practices that may impact negatively local economic growth.

Speaking at the Competition Policy for Regional Development dialogue at L’Fisher Chalet in Bacolod City on April 10, PCC Chairman Arsenio Balisacan said people should know what they can do to reduce anti-competitive activities.

Balisacan, former director general of the National Economic Development Authority (Neda), said the public are urged to inform the PCC if they see, hear or know any practices that violate the competition law and its provisions.

“Reporting to us is the best way to contribute and make competition works,” he said, adding that “we cannot do it alone so we need stakeholders especially in telling us the problem.”

Anti-competitive practices include anti-competitive agreements like price-fixing, bid-rigging, limiting outputs, and market sharing; abuse of dominant position; and mergers and acquisitions.

The dialogue attended by representatives of various business chambers, private organizations, and government agencies in Negros Occidental is part of the commission’s work program.

Organized in partnership with the Neda and National Academy of Science and Technology-Philippines, it is aimed at enhancing the awareness and elevating the level of appreciation on effective competition policy for regional development.

The PCC, through the forum, also wants to encourage collaborative consultations between government agencies and businesses, and promote compliance in competition policy among business chambers and trade organizations.

Among the major concerns raised during the panel discussion included alleged anti-competitive practices performed by some government-owned and controlled corporations (GOCCs), which are under the jurisdiction of the PCC.

Lawyer Orlando Polinar, director of PCC Competition Enforcement Office, said for the commission to realistically look into these concerns more deeply, it needs to have specific information from the public, especially from the affected parties.

Polinar pointed out that there can be no progress in terms of inquiry without information at hand.

“GOCC is also performing some vital governmental functions, its mandate is not purely proprietary thus, we have to balance the two functions,” he said, adding that “information is something that the commission can work on then decide on how to proceed from there.”

Aside from GOCCs, the PCC also covers any person or entity engaged in any trade, industry, and commerce in the country, as well as trade associations if used in violation of Philippine Competition Act (PCA).

Key to inclusive growth

Formed in February 2016, the PCC is an independent quasi-judicial body with original and primary jurisdiction over competition-related issues in the market.

It is in charge of enforcing the PCA, or Republic Act 10667, promulgated to protect competition in the market for the purpose of maximizing consumer welfare.

The law aims to enhance economic efficiency and promote free and fair competition in trade, industry, and all commercial economic activities.

PCA also adheres to prevent economic concentration and penalize all forms of anti-competitive practices in order to protect consumer welfare, and advancing domestic and international trade and economic development.

In his presentation, Balisacan said competition policy is a key to inclusive growth and consumer welfare.

He pointed out that economic growth has been the predominant source of poverty reduction in low and middle-income countries. In the medium to long-term, total factor productivity growth is what makes development sustainable.

“Competition induces structural transformation of employment, from low to high productivity sectors or areas,” Balisacan noted.

Benefits of competition

Moreover, the PCC chairman underscored some of the benefits of competition including cheaper medicine for all.

“Strengthening competition in the local medicine market is crucial to lowering prices,” he said.

Also, competition is seen to de-monopolize telecommunication companies (telcos), lower margins in the Philippine transport industry, and bring in potential gains in the domestic shipping sector, among others.

Without competition, the government is looking at having few industry players, no level playing field, poor quality of products and services, higher prices, limited consumer options, and anti-competitive business practices.

Initial gains

In terms of development in competition enforcement, PCC records showed that they received a total of 102 queries and informal complaints on possible anti-competitive conducts as of March 30 this year.

It handles seven preliminary inquiries, of which, six advanced to a full administrative investigation, it added.

For mergers and acquisitions alone, the commission received 141 transactions as of this month.

“I think given the attention that we are getting now and the cases that we carried, we have been doing well in a span of just two years,” Balisacan added.


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