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A Strong Competition Policy for the Philippines
 

A Strong Competition Policy for the Philippines

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New Age FTAs: Is the Philippines Mature Enough?

New Age FTAs: Is the Philippines Mature Enough?
10 February 2012
Dusit Thani Ballroom B
Makati City

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    A Strong Competition Policy for the Philippines A Strong Competition Policy for the Philippines Presentation Transcript

    • Lai-Lynn A. B. Barcenas T A Trade Advisory Services A STRONG COMPETITION POLICY FOR THE PHILIPPINES New Age FTAs: Is the Philippines Mature Enough? 10 February 2012 Dusit Thani Ballroom B Makati City
    • WHAT IS COMPETITION POLICY?
      • Governmental policy that promotes or maintains the level of competition in markets, and includes governmental measures that directly affect the behavior of enterprises and the structure of industry and markets
      • Two elements:
      • Policies that promote competition and greater reliance on market forces
      • Competition law
      • Source : ASEAN Regional Guidelines on Competition Policy
      A STRONG COMPETITION POLICY FOR THE PHILIPPINES
    • Period of Deregulation, Privatization and Liberalization 86 88 90 92 94 96 98 00 02 04 06 08 10 12 Foreign Investment Banking Foreign Banks Telecoms Civil Aviation Downstream Oil Retail Trade Electric Power Shipping Gradual Reduction of Tariffs and Import Restrictions (WTO, AFTA, APEC and other FTA commitments) A STRONG COMPETITION POLICY FOR THE PHILIPPINES
      • To date, the Philippines does not have a comprehensive and developed legislation relating to anti-trust and monopoly activities.
      • There are several anti-trust bills that had long been pending before the Philippine Congress and previous efforts were made to enact a comprehensive competition law but currently, the country ’s competition laws are widely fragmented.
      • Source: Anthony Amunategui Abad, Presentation on ASEAN Competition Policy
      COMPETITION POLICY & LAW IN THE PHILIPPINES A STRONG COMPETITION POLICY FOR THE PHILIPPINES
      • Unfair Competition
        • 1987 Philippine Constitution
        • Revised Penal Code, Art. 186; Rep. Act 3247 (1930)
        • Civil Code, Art. 28 (1949)
        • Tariff and Customs Code, Arts. 301 and 302 (1957)
        • Intellectual Property Code, Arts. 168 to 169 (1997)
        • Price Act, Sec. 5 (3) (1992)
        • Related sectoral laws
      • Consumer Protection
        • The Consumers ’ Act (1992)
      COMPETITION POLICY & LAW IN THE PHILIPPINES A STRONG COMPETITION POLICY FOR THE PHILIPPINES
      • No central government agency monitors the implementation of competition policy and law.
      • Various government agencies are tasked with both the regulation and promotion of competition in different economic sectors:
        • National Telecommunications Commission for telecommunications
        • Energy Regulatory Board for power
        • Maritime Industry Authority for the shipping industry
        • Philippine Ports Authority for ports and arrastre services
        • Civil Aeronautics Board for air commerce
        • Source: Anthony Amunategui Abad, Presentation on ASEAN Competition Policy
      COMPETITION POLICY & LAW IN THE PHILIPPINES A STRONG COMPETITION POLICY FOR THE PHILIPPINES
      • Corporation Code of the Philippines covers the rules on mergers, consolidations and acquisitions, but does not address competition issues
      • Laws have been ineffective and hardly used or implemented.
      • Since some laws are penal in nature, the amount of evidence required is tremendous.
      • The fines are insufficient.
      • Lack of appreciation and political will to pass a comprehensive law in previous administrations.
      • Source: Anthony Amunategui Abad, Presentation on ASEAN Competition Policy
      COMPETITION POLICY & LAW IN THE PHILIPPINES A STRONG COMPETITION POLICY FOR THE PHILIPPINES
    • GDP PER CAPITA (CONSTANT 2000 US$) Source : World Development Indicators, World Bank A STRONG COMPETITION POLICY FOR THE PHILIPPINES
    • FTAs WHERE PHILIPPINES IS OR COULD BE A PARTY
      •  
      ASEAN + 3 [China, Japan, South Korea] (under consideration) ASEAN FTA (Brunei, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam) ASEAN- China ASEAN- S. Korea ASEAN - Japan ASEAN – Australia/New Zealand ASEAN - India Japan EU Trans-Pacific Partnership Agreement A STRONG COMPETITION POLICY FOR THE PHILIPPINES
    • CHALLENGES TO THE ADOPTION OF A PHILIPPINE COMPETITION POLICY AND LAW
      • State of Competition in the Philippine market
      • Lack of a culture of competition
      • Resistance from various interest and lobby groups
      • Micro, small and medium enterprises
      • Incomplete deregulation, privatization and liberalization
      • Inadequate regulatory and legal infrastructure, widespread corruption, poor corporate governance and lack of transparency
      • Cross-border implementation and coordination
      • Establishment of an ASEAN Economic Community by 2015
      • Impact of other Free Trade Agreements
      A STRONG COMPETITION POLICY FOR THE PHILIPPINES
    • GUIDELINES FOR ASEAN COMPETITION POLICY & LAW
      • Enact competition laws
      • Pay special attention to the needs of small and medium enterprises
      • Adopt a relaxed or flexible approach to restraints on vertical arrangements
      • Include misleading advertising, misrepresentations and frauds in competition laws to enhance consumer protection
      A STRONG COMPETITION POLICY FOR THE PHILIPPINES
    • GUIDELINES FOR ASEAN COMPETITION POLICY & LAW
      • Provisions on the abuse of intellectual property rights
      • Explicit provisions to include all government business activities in competition and law
      • Address the special circumstances of industries undergoing regulatory reforms
      • Empower competition agencies to handle the negative effects of local regulations on competition, e.g. inter-state trade barriers
      • Instead of anti-dumping or anti-subsidy/countervailing measures, apply competition rules in regional trade agreements to address unfair trade
      A STRONG COMPETITION POLICY FOR THE PHILIPPINES
    • GUIDELINES FOR ASEAN COMPETITION POLICY & LAW
      • Address trans-border restrictive business practices
      • Convergence in competition laws and cooperative efforts in the enforcement of such laws with member countries
      • Published guidelines and other information products that explain the main purposes of the key provisions
      • Detailed program of work for the competition agency to ensure smooth administration and effective enforcement
      A STRONG COMPETITION POLICY FOR THE PHILIPPINES
    • PENDING BILLS IN CONGRESS
      • House Bill No. 4835: An Act Penalizing Anti-Competitive Agreements, Abuse of Dominant Position, and Anti-Competitive Mergers, Establishing the Philippine Fair Competition Commission and Appropriating Funds Therefor and For Other Purposes
      • Senate Bill No. 1 : An Act Penalizing Unfair Trade and Anti-Competitive Practices in Restraint of Trade, Unfair Competition, Abuse of Dominant Power, Strengthening the Powers of Regulatory Authorities and Appropriating Funds Therefor, and for Other Purposes
      A STRONG COMPETITION POLICY FOR THE PHILIPPINES
    • END OF PRESENTATION T H A N K Y O U ! T A Trade Advisory Services 8 F Citibank Center, Paseo de Roxas Makati 1226 Philippines www.TAadvisors.net [email_address] A STRONG COMPETITION POLICY FOR THE PHILIPPINES