The leadership of the House of Representatives has committed to passing the proposed Philippine Fair Competition Act (PFCA) in March, after the Joint
Foreign Chambers (JFC) and Philippine business groups urged law makers to prioritize the passage of the key economic measure.
Liberal Party Rep. Antonio Rafael del Rosario of Davao del Norte, one of the authors of House Bill (HB) 5286, or the consolidated
version of the proposed Philippine Fair Competition Act, said the measure is the product of the joint efforts of the committees on Trade and Industry and Economic Affairs, after conducting one executive briefing, four public hearings, three technical working group meetings and countless hours of consultations with various stakeholders over the course of seven months to come up with the final product.
“[After this long committee deliberations] we’re hoping to get the bill approved on third and final reading before our March break,” del Rosario, who sponsored the measure on floor, told the
BusinessMirror. Congress will take a break from March 21 to May 3.
Earlier, the JFC and Philippine business groups have repeatedly urged the leadership of the House of Representatives to prioritize the passage of several economic measures, including the proposed PFCA.
Alfredo Yao, president of the Philippine Chamber of Commerce and Industry, said during the House of Representatives meeting with the business organizations, said the Congress should treat the proposed Philippine Fair Competition law with urgency.
“There should be a level playing field for businesses to provide better services and products,” he said.
Del Rosario said a competition law will be passed in preparation for 2015 Asean Integration, which seeks to establish “a single-market and production base with free movement of goods, services, labor and capital.”
He said the measure aims to minimize, if not totally eradicate, unfair competition, monopolies and cartels.
The bill also heavily penalizes monopoly, anti-competitive mergers and other unfair trade practices.
The measure defines monopoly, a a form of market structure in which one entity has earned a privilege or obtained advantage over others in the sale of a good or service.
As defined under the measure, a mergers is a situation where two or more entities, previously independent of one another, join. These include transactions whereby: two entities combine, one entity takes control of the whole or part of another, two or more entities acquire control over another entity and other transaction whereby one or more undertakings acquire control over one or more entities.
The bill also proposes to create the Philippine Competition Commission (PCC) that will prosecute those engaged in unfair and deceptive trade practices with the purpose of preventing,
restricting or distorting competition. Further, the bill provides for a Transitional Clause in order to allow affected parties time to renegotiate agreements or restructure their business to comply with the law.
According to del Rosario, the PCC is an independent body which shall have original and exclusive jurisdiction to enforce and implement the competition law.
“Likewise, the PCC is empowered to investigate violations of the competition law; issue subpoena duces tecum and testificandum, cease and desist orders; conduct administrative proceedings, impose administrative fines; issue advisory or legal opnions; and is mandated to submit reports to Congress, including proposed legislation for the regulation of commerce, trade and industry,” he added.
He said that in determining whether anticompetitive agreement or conduct has been entered into or committed, the commission shall observe the following guidelines:
■ Define the relevant market allegedly affected by the anticompetitive agreement or conduct;
■ Determine if there is actual or potential adverse impact on competition in the relevant market caused by the alleged agreement or conduct, and if such impact is substantial and outweighs the actual or potential efficiency gains that result from the same;
■ Adopt a broad and forward-looking perspective, recognizing future market developments, but also taking account of past behavior of the parties involved and prevailing market conditions;
■ Balance the need to ensure that competition is not prevented or substantially restricted and the risk that efficiency may be deterred by overzealous intervention; and
■ Assess the totality of evidence on whether it is more likely than not that the entity has engaged in anti-competitive agreement
or conduct.
A person who fails or neglects to comply with any term or condition of a binding ruling, a cease and desist order or an order for readjustment issued by the commission, shall pay a fine of not less than P50,000 and not more P200,000 for each violation.
The measure, however, said the decisions of the PCC are appealable to the Court of Appeals, with the Supreme Court as the court of last resort.
The commission may also im-
pose upon entities fines of not less than P5,000 to not more than P100,000, where, intentionally or negligently, they supply incorrect or misleading information in any document, application or other paper filed with or submitted to
the commission.
The bill also provides that an entity that enters into any anti-competitive agreement or conduct as defined under this act shall, for each and every violation, be penalized by imprisonment of five to 10 years, or a fine up to 10 percent of the annual turnover of infringed during the previous fiscal year or up to 10 percent of the value of the assets of the infringed, whichever is higher, or both imprisonment and fine.