Framework set for `competitive neutrality’ of state enterprises

The Philippine Competition Commission (PCC) has partnered with the Governance Commission for GOCCs (GCG) to promote “competitive neutrality” among government-owned and controlled corporations (GOCCs), marking a crucial step toward ensuring a level playing field for the public and private corporate sectors.

The country’s anti-trust agency said on Tuesday it had signed a memorandum of agreement (MOA) with the GCG, formalizing coordination in reviewing existing regulations and guidelines to ensure compliance with applicable competition laws and principles.

“This MOA will provide for exchange of information when it comes to PCC’s assessment of the impact on the market of mergers or acquisitions involving GOCCs or transactions post-decoupling,” PCC Officer-in-Charge Johannes Bernabe said in a statement.

The agreement is seen to facilitate consultations between the two agencies in implementing policies of mutual interest and coordination on merger reviews involving GOCCs.
The GCG is the central policy-making and regulatory body mandated to safeguard GOCCs.

Joint capacity building

There was also an agreement to conduct capacity-building activities and support the rollout of the National Competition Policy (NCP).

“The underlying principle of competitive neutrality is fairness. It means state-owned enterprises and private businesses compete and operate on a level playing field, while recognizing GOCCs’ critical roles and interventions across sectors,” Bernabe said.

The NCP provides a framework for government agencies in creating and adopting pro-competitive policies, rules and regulations, as well as issuances to avoid competition distortions and an uneven playing field for businesses.

Back in October 2021, President Marcos Jr. signed Administrative Order No. 44 (s. 2021), directing government agencies to adopt and implement the NCP.

Also included in the MOA is the review of existing regulations and guidelines issued by the GCG and GOCCs.

The PCC said this would ensure consistency in adhering to both the NCP and the principle of competitive neutrality.

A joint task force in the implementation of coordination and cooperation efforts will also be formed.
Both the GCG and the PCC also committed to provide access to information and documents, including reports, data sets, analyses, assessments, notices and guidelines under the agreement.