Competition Policy Issues in
the ASEAN Context
Erlinda M. Medalla
PIDS Research Fellow
7up 2 Final Meeting
June 27-28, 2006
Bangkok
Brief Survey of Competition
Law in ASEAN
Brunei Darussalam
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Monopolies Act (1932) but no
comprehensive legislation pertaining to
all aspects of competition
Currently developing its competition
law
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Comprehensive single regulatory body or
sectoral regulations?
How properly to implement the
competition rules from grassroots up
Cambodia
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Various legislations covering aspects
of competition and consumer
protection but no comprehensive
competition law
Passing a new competition law
appears to have low priority

Priority: to create functioning private
markets before being overly concerned
about their domination and abuse
Indonesia
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New competition law (1999): Prohibition of
Monopolistic Practices and Unfair Business
Competition, effective since March 2000
Created the Commission for the Supervision
of Business Competition (KPPU)
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Tasks: Both law enforcement and policy
recommendation
Increasing application/enforcement
Indonesia
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Challenges

New culture: lack of understanding and
internalization of competition law and policy by
the government and legal institutions and
business sector
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Different perceptions between KPPU, government
institutions and other legal institutions
Lack of human resources and competencies
Lack of operational instrument of competition
law

Need to develop guidelines and cooperation with
police
Lao PDR
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Decree on Trade Competition, PMO No. 15
(2004)
 Regulates
monopolization and unfair competition
in trade of all forms, to promote fair trade
competition, protect the rights and legal interests
of consumers and to encourage business
activities

Competition Authority
 Trade
Competition Commission under Ministry of
Commerce
Malaysia
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Sectoral approach: no national
competition law

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There is an array of statute which
regulate trading and business activities
as well as protect the consumer interests
New competition law being considered

Since 1991; recognized in 8th Malaysian
Development Plan; cautious approach
Myanmar
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No competition policy or law
Does not appear to be on the immediate
horizon of policy makers
Lack of competition culture
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Transition economy; takes time to change
mindset
inward-looking policy and closed-door form of
socialism
high levels of government intervention
public monopolies which restricts entry into
several sectors of the economy
under-developed private sector
Philippines
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Various legislations covering aspects of
competition and consumer protection but no
comprehensive competition law
Has an anti-trust law that has never been
used
Various bills being proposed
Sector reforms incorporating competition
objectives
Singapore
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Competition Act in October 2004

Prohibited activities
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Scope of Application
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anti-competitive agreements
abuse of dominant position
anti-competitive mergers & acquisitions
applies to all undertakings but there are
exemptions
Enforcement
Appeal Process
Singapore
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Competition Authority

Competition Commission of Singapore
(CCS)
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to implement and enforce the competition law
statutory body under Ministry of Trade and
Industry, Singapore
Powers of the CCS
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investigate any infringement
make decisions
impose sanction
Thailand
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Enacted Competition Act B.E. 2542 in
1999
Competition Authority

Trade Competition Commission (TCC)
under Department of Internal Trade (DIT)
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consists of 16 members from public and
private sectors
have specialized sub-committee, inquiry subcommittee and appellate committee
Vietnam

Law 27-2004-QH11 on Competition
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approved in November 2004 session and
came into force on 1 July 2005
Establishes a Competition
Commission and Competition Council
Competition authorities have been
established but are not yet operational
Budget and human resource problem
Vietnam
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Competition authorities

Vietnam Competition Administration Department
(VCAD)
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established under the Ministry of Trade (MOT) in early
2004
delegated statutory powers effective 5 February 2006
(more than 6 months after law effectivity)
Vietnam Competition Council (VCC)
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will comprise 11-15 members appointed by the Prime
Minister on the proposal of the MOT
will be responsible for hearing and resolving cases
concerning practices in restraint of competition
Major Issues
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Question on the need for a new
Competition Law; Create a central
competition authority?
Serious concerns about capability and
competency
Competition culture not fully developed
Inadequate Information and advocacy
Interface with other government policies

E. g. industrial policy, agricultural
development, environment protection
Main Apprehension
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Difficult task to implement properly
Apprehensions about the types of
business practices will be considered
anti-competitive or restrictive
Pessimistic that, at the very least, it
would become just another regulatory
layer
Risks of regulatory capture
So many things could go wrong…
Central Competition Authority?

How can this become a credible,
respected Authority?
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Goes back to the issue of capability and
competency
Should have good legislative foundation
Relationship between regulatory
bodies and Competition authority
Enforcement issues
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Costs of creating enforcement body
and needed capability building,
Cost of enforcement itself
Risks from government failure
These could weigh heavily against
acknowledged potential benefits
Sectoral approach more costeffective?
Interface with Other
Government Policies

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Various national objectives other than
competition-- including safety and
standard regulations, equity and
access, sector development.
Concern about how competition policy
could restrict policy space for other
national objectives
Interface with Other
Government Policies
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Conflicts could arise. Priorities should
be made clear at the outset. And
sometimes this is not easy.
The institutional design, and the
division of powers and responsibilities
between sector specific agencies and
the general competition authority
should be carefully crafted.
Nonetheless…
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There is increasing recognition of
benefits from having a working
competition law and policy
Especially within the context of the
global regime, need for some form of
regional cooperative approach.