Metro Manila (CNN Philippines, October 5) — A lawmaker questioned the provision of Bayanihan 2 which exempts mergers and acquisitions worth less than P50 billion from review of the government’s anti-trust body.
Gabriela Party-list Rep. Arlene Brosas said during the plenary deliberations on Monday for the Philippine Competition Commission’s 2021 budget that the Bayanihan 2 provision exempting these kinds of transactions from the required compulsory notification under Republic Act 10667, or the Philippine Competition Act, curbs the authority of the PCC.
She added that this exemption affects transparency when it comes to disclosing such business deals.
This provision under Bayanihan 2 covers transactions entered into within a period of two years from the law’s effectivity. Also, these transactions will be exempted from PCC’s motu proprio review for one year.
Originally, the PCC had to be notified of transactions valued at P2.4 billion. The agency reviews these to ensure that this will not limit competition and negatively affect consumers.
Brosas specifically mentioned Dennis Uy, who, she said, was able to build “his empire in the matter of years under this administration.” She asked how businesses like his can be monitored since they can benefit from relaxing restrictions.
Albay Rep. Joey Salceda, the sponsor of PCC budget, explained that this restriction was lifted to allow businesses to have “efficient operations.”
“In the way the pandemic affected our economy, there is a greater economic logic that we allow these transactions to proceed unhampered,” he said.
Salceda noted that not doing so will further negatively affect the country’s economy, especially in terms of value of production, job, and consumer welfare by way of prices.
Guidelines
The PCC has issued rules on merger reviews to ensure that market competition is still maintained. It said mergers and acquisitions that are “likely to substantially lessen competition” may be reviewed motu proprio after 1 year from the effectivity of Bayanihan 2.
The Section 4 (eee) of the law also exempts transactions with values below P50 billion if entered within 2 years from the effectivity of Bayanihan 2. It also suspended the PCC’s exercise of motu proprio review of these transactions for 1 year
Under the guidelines released on Monday, it said the following transactions are still subject to compulsory notification:
– Transaction value is at least PHP 50 billion
– Entered into before the effectivity of Bayanihan 2 and exceed the applicable thresholds when the definitive agreement was signed.
