Competition
Law, Part 4
Indeed,
local companies have sometimes established a monopoly position in the
market in specific sectors. For instance, in telecommunications, Chinnawat
Co., Ltd., a Thai company, monopolises the Thai market in mobile phones
and related products; Telecom Asia is a monopoly telephone network provider
in Thailand, and Sammart Telecom Co. Ltd is the only provider of satellite
dishes.
ASEAN
countries also reserve some business sectors and exclude foreign investors
from investing in those specific fields of business. But all these laws
and regulations have to be phased out. All industries will be opened for
investment to ASEAN investors by 2010 and to all investors by 2020 subject
to some exceptions. Therefore, if ASEAN countries liberalise their investment
regimes, they may be concerned that they are moving from a system of screening
all take-overs by foreign firms of national firms to screening none. They
may see risks of foreign firms acquiring dominant positions. To replace
these investment laws by competition laws may not only prove to be more
effective than the screening process, but also a more efficient way to
assess the competitive effects of foreign firms at the time of entry and
after entry.
Competition
laws and policies thus have a major role to play in the process of ASEAN
liberalisation. This is also to ensure that the ASEAN market is kept as
open as possible to new entrants, and that firms do not frustrate this
by engaging in anti-competitive practices. In this manner, the vigorous
enforcement of ASEAN competition law can provide a reassurance that investment
liberalisation will not leave the government powerless against anti-competitive
transactions or subsequent problems.
Competition
laws may replace the restrictive investment laws and regulations, with
principles based on non-discrimination in the control of restrictive business
practices among firms, regardless of the origin or the nationality of
enterprises. Competition laws normally apply to all firms operating in
given national or regional territories, whether through domestic sales,
imports, affiliates or non-equity forms of foreign direct investment.
They do not, in principle, discriminate between national and foreign firms,
or between firms from different national origins. In this manner, competition
law monitors the competitive behaviour of TNCs having effects in host
ASEAN countries. This is to ensure that all firms do not abuse dominant
market power, and to prevent inefficiencies stemming from market allocation
agreements which might lessen trade and investment. Therefore, competition
law strengthens the principle of national treatment and enhances investment
liberalisation, to comply with the objectives of the ASEAN investment
area and economic integration in ASEAN.
Now
I will assess the existing ASEAN laws relating to unfair competition,
to consider to what extent ASEAN needs a comprehensive competition law
at a regional level and in what respect competition law could replace
the current foreign investment laws in ASEAN countries.
1.2
Survey of ASEAN Laws Relating to Unfair Competition
Currently,
ASEAN countries do not have systematic competition laws and policies.
Some ASEAN countries do have some elements of anti-trust law or anti-
monopoly laws. In this section, I attempt to survey, country by country,
the ASEAN laws relating to unfair competition and to analyse whether those
laws are effectively enforced to control anti-competitive business practices.
Part
5 |