Metro Manila (CNN Philippines) — Just this week, the Department of Trade and Industry (DTI) asked the National Bureau of Investigation to investigate a possible collusion between flour millers and bakers. The DTI is to submit to the bureau on Friday (June 26) production data from the two groups.
A bill awaiting President Benigno “Noynoy” Aquino III’s signature seeks to prevent anti-competitive practices.
The Philippine Competition Act’s (PCA) principal author, Paolo Benigno “Bam” Aquino IV believes that it will usher in a more efficient market economy.
“In other countries, they’ve had their competition policy for the last 40, 50, 60 years… We’re only having our competition policy in 2015,” the senator told CNN Philippines in an exclusive interview on Friday.
Aquino added that among other things, the law explicitly prohibits cartels — competitors who collude to fix market prices. Likewise, the legislation also outlaws anti-competitive agreements and abuses of dominant players.
“So now it’s quite clear that in our market, a large player can’t just bully small players; competitors can’t collude to raise process unnecessarily.”
The PCA creates the Philippine Competition Commission, which plays a role similar to that of the Federal Trade Commission in the U.S., or the Japanese Fair Trade Commission in Japan. “These bodies fine companies who are doing anti-competitive acts… or in the case of cartels even put to jail.”
“Aside from being a watchdog, it’s also a quasi-judicial body, so they get to rule on these cases also. On their own, they can fine administrative penalties and they can also refer [companies] to the DOJ [Department of Justice] for criminal prosecution.”
Although the country has posted strong economic growth over the past several years, Aquino was appalled that it did not have a fair competition law. “It’s crazy.”
He also pointed out that the bill had been in the legislative mill for over two decades.
“If you look at our economy, we’re moving up in the world, but without a competition policy it will be harder for us to sustain its growth.”
He clarified that the bill is against unfair competitive practices, and not healthy competition itself. “It’s a level playing field.”
“You get the best and brightest from the market. If you’re able to get more people in the market, innovation goes up, prices go down, and it’s good for our consumers.”
Aquino predicts that the bill helps the economy as it opens up further to a global market. “As we open up and we allow our products to enter their markets, we allow their products to enter our market, but with clear guidelines [and] clear competition rules.”
