More broadly, the absence of an authority that advocates competition implies that laws, regulations, and government policies that are fundamentally anti-competitive are not being questioned. For example, the Telecommunications Act was passed with a section that limited foreign ownership in local telecom companies to only 25%. This foreclosed competition from smaller local operators that had hoped to partner with strong foreign telecom companies from overseas. The law served only to protect large incumbents with strong financial backing that need not rely on foreign capital or expertise. Meanwhile, several mergers that led to more concentrated markets were allowed to proceed. These include a merger between two major movie theaters,48 pulp and paper manufacturers,49 and newspapers.50 The inability to control mergers and hence market concentration today will likely create competition problems down the road, as merged entities with market power may abuse their newly acquired market dominance to fend off competition from smaller competitors or new entrants.

Needless to say, the public image of the effectiveness of the OTC and the TCC has been reduced to nothing. The fact that the Commission's reputation had been tarnished even before it has had a chance to establish one does not help promote a competition culture in Thailand.

It is not only the public that has lost faith in this agency; the OTC's own staff appears to have lost morale. The officers and employees of the OTC have developed the technical and analytical skills required to deal with competition cases and have put the acquired skills to use in preparing competition cases for the Committee. But all their efforts appear to be in vain as the Committee has failed to regularly meet to discuss these issues, which reflects the general lack of interest in seeing the law enforced.51 Additionally, the list of complaint cases awaiting the Committee's deliberation was removed from the website and a number of competent officers were transferred to other activities. There seems to be no sign of any progress. The lack of enforcement has harmed the Thai economy, as it leaves SMEs vulnerable to the unfair practices of larger competitors, buyers, and suppliers.

V. LESSONS LEARNED
Despite the lack of implementation of the competition law by the government, the Thai case study offers several lessons that may be of some relevance to other countries considering passing such a law. First, in the absence of a clear political mandate to implement the law, it is unlikely that the law will be enforced. Second, if and when the law is enforced, it tends to be selective and arbitrary in the absence of rules and regulations that ensure transparency and accountability of administrative procedures. Third, in the absence of a political will to enforce the law, a country needs to adopt a bottom-up approach to advocating the law and must rely instead on public pressures to promote a competition regime. Building awareness and appreciation of a competition law is a difficult and time-consuming process that requires close coordination among academics, NGOs, and the media.

The Thai experience shows clearly that having a competition law is no panacea in the absence of a political will to see the law properly enforced. The promulgation of the law for the sake of fulfilling the spirit of the Constitution does not bode well for the future enforcement of a paper tiger. It could not stand against the powerful lobbying of large businesses that have more recently become directly involved in politics. Political interventions, big businesses' opposition, and institutional limitations prove to be major hurdles in law enforcement. In such an environment, the prospect of having a successful competition regime is indeed bleak. The question is then, should a country where business and politics are closely linked bother to have a competition law at all? And if so, what are the pre­requisites that would help ensure an effective implementation of such a law?

In hindsight, perhaps Thailand should not have passed a competition law in 1999 when the political and social environment was not conducive to successful implementation. Nevertheless, the law has contributed positively toward the building of a competition constituency in Thailand among politicians, academics, NGOs, and businesses, albeit still limited in scale. Its mere existence puts politicians in a defensive position. The lack of implementation of the competition law has always been one of the key issues that the opposition party raises in a censure debate.52 Business and academic communities have also become more aware of the law despite its lack of enforcement over the years. For example, the Director Certificate Program offered by the Thai Institute of Directors53-a program aimed at training corporate directors to be aware of and knowledgeable of their rights, responsibilities, and accountability-includes a separate module on competition law and policy. More universities, such as Bangkok University, now offer courses on competition law and policy in their graduate law schools.54

The law also helps promote capacity building in this field. The Trade Competition Office, despite its inertia, continues to receive bilateral and multilateral technical assistance from countries such as Japan, Taiwan, and Australia and from organizations such as the World Bank and UNCTAD.55 Lastly, NGOs, civil societies, bureaucrats, academics, the private sector, and the media have also grown accustomed to making references to the law despite its inertia.

So, if a country were to pass a competition law for the first time, how should it proceed? It is impossible to prescribe a general formula given that each country has a unique economic, social, and political environment. It is probably better to elaborate on what Thailand's case may have to offer in terms of its experience. Certain countries may find that the Thai situation closely resembles their own. Others may not be able to associate with the kind of political, institutional, and social environment relevant to the Thai case study.


Footnotes

48. Competition to Fuel Mergers, THE NATION, Jan.6, 2005, http://www.nationmultimedia.com/2005/01 /06/business/data/business_l 5980936. html.
49. Keith Barney, At the Supply Edge: Thailand's Forest Policy (2001), http://www.forest­trends.org/prograrns/pacific_ im.htm.
50. Media Upheaval, THE NATION, Sep. 14, 2005, http://www.nationmultimedia.com/ specials/mediaupheaval/p l .php.
51. More recently, some of the qualified staff at the Office of Trade Competition Promotion were assigned new tasks of promoting the franchise of low-cost fast food cart vendors by the Department of Internal Trade in which it resides. The project is promoted by the Ministry of Commerce to help keep down the cost-of-living during high oil-prices periods. See The Elephant Talks 3 (2005), http://research.mulliscapital.com/products/ dailynotes/The%20Elephant%2OTalks_DA_05.08.18.pdf.
52. Adisai Under Siege, THAI RATH, May 29, 2003, http://www.thairath.com/thairathl/ 2546/page 1 /may/29/p 1 3. asp.
53. Thai Institute of Directors Home Page, http://www.thai-iod.com (last visited Feb. 21, 2006).
54. Bu.ac.th, Admissions Manual, http://admission.bu.ac.th/ gs_ms_thai_laws_course_descriptions_courses_subject.htm.
55. Nipon Poapongsakom, Thailand Trade Competition Act (2003), http://www.apeccp.org.tw/doc/APEC-OECD/2003-12/013.pdf.

 
* "This article is published with the kind permission of Deunden Nikomborirak and the Northwestern Journal of International Law and Business.. This article orignally appeared of the Vol.26 No.3 Spring 2006 edition of theNorthwestern Journal of International Law and Business.
 

 

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