Home 
Publications Online Publications Document
|
Competition Law Toolkit : Practices Controlled by Competition Law
Public Restrictions of Competition and Competition AdvocacyIn the section, Practices Controlled By Competition Law, the toolkit has considered the way in which firms behave in the marketplace and has tried to identify the kinds of behavior that might attract the attention of the competition authorities. However, a quite different role that competition authorities can be given is to scrutinize legislation, regulations, the provision of licensing regimes, subsidies and other governmental acts that bring about, or are responsible for, a distortion of competition in the economy. The reality is that states and regulatory authorities are capable of harming the competitive process at least as seriously as private economic operators on the market, e.g., by granting legal monopolies to undertakings, by limiting in other ways the number of competitors in the market, or by establishing unduly restrictive rules and regulations. Action is therefore needed against public restrictions of competition as well as the private restrictions with which competition laws have traditionally been concerned. This can be achieved directly, for example, by explicitly stating that administrative monopolies created by the state are themselves subject to competition law, as was proposed in the November 2005 draft of the Chinese Anti-Monopoly Law. Another way of dealing with this issue is for the state to give its competition authority a competition advocacy role. Some competition authorities are specifically mandated to scrutinize legislation that will distort competition. Indeed, it has been argued that some developing countries might more usefully deploy their resources on this issue rather than adopting their own competition rules. An interesting example in the Asia and the Pacific region is the work of the Korean Fair Trade Commission. The Korean Monopoly Regulation and Fair Trade Act obliges heads of administrative bodies in Korea to consult the Fair Trade Commission prior to enforcing laws or policies that may have anti-competitive effects. Furthermore, the Chairman and Vice-Chairman of the Commission regularly attend Cabinet meetings of the government. The Chairman of the Commission is also an ex officio member of the Regulatory Reform Committee which has control over all regulatory reforms. The ICN has established a Working Group to look into the issue of competition advocacy in relation to regulated sectors in developing countries, where it may be particularly important to ensure that arguments in favor of competition in such sectors are effectively heard.
|
RSS Feeds
Back
Top of page