PCCI Cites Need for Early Passage of Competition Law

Manila– Time is running out for Congress to pass a competition law that would prevent anti-competitive business practices, abuse of market power and anti-competitive mergers and other unfair trade practices.

“We hope that when it goes back to work for its May 5 to June 13 session, the 16th Congress would give top priority to approving competition bills now pending before it,” said Philippine Chamber of Commerce and Industry (PCCI) president Alfredo M. Yao.

“The economy needs a competition law to upgrade the country’s competitiveness and maximize the benefits of integrating the economy with those of other ASEAN economies by 2015. If we give our neighbors a difficult time to do business here, they will also give us a hard time accessing the ASEAN market of 600 million consumers,” he said.

Citing that competition law will promote a more open environment for investments, innovation and pricing, and will level the playing field for new entrants and current investors wishing to expand or diversify their investments in the domestic market, Yao stressed: “A competition law would be a landmark legislation whose significance to the economy would be underscored once the AEC and other economic partnership agreements come into play.”

In the Senate and the House of Representative, the pending bills have gone through first reading. These are in public hearing and consultation stages. Shepherding the bills are Senator Bam Aquino in the Senate and Rep. Mark Villar in the House.

Cielito Habito, an advocate for a competition law and former economic planning secretary, has cited examples depicting restrictive business practices that have given rise to the need for a competition law.

In a seminar-workshop on competition policy and law organized for legislative staff by the PCCI, the USAID-TRADE (Trade Related Assistance for Development), the House Committee on Trade and Industry and the Senate Committee on Trade, Commerce and Entrepreneurship, Habito cited how small retailers are threatened at being cut off from supply deliveries by giant manufacturers if the stores continue to sell soap produced by livelihood producers.

Certain malls limit sites for competing ATM brands in their premises. Micro, small and medium enterprises are discouraged by big banks from borrowing, insisting on documents while easily lending to large companies. Farmers are penalized by high shipping costs because of the lack of competition in the shipping industry.

Habito said that if such restrictive business practices or the potential for market abuse are controlled, small and medium enterprises would have a level playing field to compete, more foreign investments previously deterred from entry would come in, and companies become more efficient, produce at the lowest possible cost and pass on savings to buyers.

PCCI has been leading the campaign for a competition law and for independent regulatory authority to enforce the legislation. (PNA) SCS/PR/JSD