Highlights of PH Competition Act and Cabotage Law

Salient features of Republic Act No. 10667, or the Philippine Competition Act:

— Levels the business playing field for all companies operating in the country, from the large foreign multinationals down to the local micro-, small- and medium-sized enterprises.

— Creates the Philippine Competition Commission that will look into anticompetitive behavior, abuses in dominant positions, and anticompetitive mergers and acquisitions.

— Addresses prohibited acts, such as the abuse of dominant position and anticompetitive agreements.

Activities under abuse of dominant position include selling goods or services below the market prices to suppress competition; imposing barriers to entry; imposing restriction on the lease or contract of sale or trade of goods and services that is anticompetitive; and making the supply of such goods dependent on the purchase of other goods or services.

Anticompetitive agreements include price fixing; limiting or controlling production, relevant markets and technical development or investment; dividing or sharing the relevant market, geographically, in terms of volume of sales, type of goods or services, or buyers and sellers; and application of dissimilar conditions to different parties.

— Imposes administrative penalties of a maximum fine of P100 million on the first offense and P250 million for the second offense for anticompetitive agreements and abuses of dominant position.

Salient features of RA No. 10668, or the Foreign Ships Co-Loading Act, also known as the Cabotage Law:

— Allows foreign ships to call in multiple ports provided that their cargoes are intended for import or export and duly cleared by the customs commissioner.

— Reduces logistic costs for producers. Before the amendments to the Cabotage Law, it was cheaper to send products from other countries to the Philippines than to ship goods within the country.

— Helps in decongesting major ports in the country.–Compiled by Ana Roa, Inquirer Research

Sources: Inquirer Archives, senate.gov.ph, congress.gov.ph, dti.gov.ph