The government will come out this year with the national competition policy, which will ensure, among others, a level playing field for state-run corporations as well as private firms.
The National Economic and Development Authority (Neda) said in a statement Thursday, that the anti-trust body Philippine Competition Commission would assist the state planning agency in crafting the said policy framework, which “will flesh out competition strategies in the country’s economic blueprint,” referring to the Philippine Development Plan (PDP) 2017-2022.
Republic Act No. 10667, the country’s comprehensive anti-trust law, tasked Neda to draft the national competition policy with assistance from the quasi-judicial PCC.
“While the enactment of the Philippine Competition Act and the good work done by the PCC on implementing the law are steps in the right direction, we believe there is still a lot that needs to be done to deliver a level playing field for businesses and higher bargaining powers for consumers,” Neda Undersecretary and officer-in-charge Rosemarie G. Edillon said.
PCC chair Arsenio M. Balisacan said in a separate statement that the national competition policy “will complement the Philippine Competition Act and the pro-competition strategies identified in the PDP 2017-2022.”
“The national competition policy provides a holistic framework that will guide the work of all branches of government and aims to promote a culture of competition in the country,” Balisacan added.
In particular, Edillon said Neda was spearheading reforms in the government-owned and/or controlled corporations (GOCCs) sector to “boost market performance as well as correct the dual regulatory and proprietary functions of some state entities.”
“If a state entity is an enterprise or operates as a business, then it must compete on equal terms with the private sector and must not have undue advantage. State support in the form of subsidies, tax incentives, and immunity from certain regulations must be reserved only for GOCCs that operate in non-profitable or non-commercially viable markets avoided by private firms,” Edillon said.
“Regulatory functions and commercial operations should not mix because of inherent conflict of interest. This principle is clearly stated in Section 2(g) of RA 10149, otherwise known as the GOCC Governance Act of 2011,” Edillon added.
“A business aims to earn profit while a regulator sets rules to protect the consumer and the public interest in general, which may negatively affect profits. So if a state entity is a regulator, then it must not be involved in business operations in the sector or market it regulates. If it is a business, then it must not have regulatory powers or influence,” according to Edillon.
Neda said the Governance Commission for GOCCs “already conducted initial steps in reviewing profiles of GOCCs.”/lb