PH competition law’s 2-year transition period ends today

The Philippine Competitive Commission (PCC) will start slapping penalties on parties found engaged in anticompetitive agreements and practices as the two-year transition period that allowed companies to correct anticompetition practices ends today.

After languishing in Congress for more than two decades, the long-awaited competition watchdog will finally be able to sink its teeth on any erring companies starting Aug. 9 if the violation “is not cured or is continuing upon the expiration” of the transition period.

Passed and made effective in 2015, the Philippine Competition Act provided for a transition period to allow affected parties time to renegotiate agreements or restructure their business in compliance with Republic Act 10667.

The law clarifies, however, that this provision does not apply to anticompetitive practices or agreements made prior to the entry into force of the competition act a few years back.

There are three main acts prohibited by the law: anticompetitive agreements such as price fixing, abuse of dominant position, and anticompetitive mergers and acquisitions. Even during the transition period, the PCC has already been looking into complaints of possible antitrust violations.

“Out of a total of 26 queries, including complaints, only three have so far progressed into full blown cases now undergoing investigation. The two of them, as everyone knows, involve power and cement businesses. We want to keep the third one confidential,” PCC Commissioner Stella Alabastro-Quimbo earlier told reporters.

With each case generally expected to take up two years, PCC’s enforcement office would later on decide whether there was enough evidence to merit the office to submit the case to the PCC commissioners for adjudication.

PCC is also currently on a legal row with giants of the telecom industry — PLDT, Inc. and Globe Telecom Inc. — that prevents the watchdog from performing a comprehensive review of the duopoly’s P70- billion deal involving San Miguel Corp.’s telco assets.

The ongoing legal battle, fought both in the Court of Appeals and the Supreme Court, revolves around whether the deal is “deemed approved” by the PCC because of the latter’s memorandum circulars. The watchdog claimed the notice on the transaction lacked crucial material information.

According to the law, an offense may lead to an administrative penalty that could cost P100 million to P250 million. In the case of criminal penalties, affected parties could be imprisoned for two to seven years and slapped a fine of up to P250 million.