Question & AnswerQ&A (Republic Act No. 10667)
The short title of Republic Act No. 10667 is the "Philippine Competition Act."
The main policy objective is to enhance economic efficiency and promote free and fair competition in trade, industry, and all commercial economic activities while preventing economic concentration that stifles competition and penalizing anti-competitive agreements, abuses of dominant position, and anti-competitive mergers and acquisitions.
It applies to any person or entity engaged in trade, industry, and commerce in the Philippines, as well as international trade with direct, substantial, and reasonably foreseeable effects in Philippine trade, industry, or commerce. It excludes workers' combinations designed solely for collective bargaining regarding employment conditions.
Acquisition refers to the purchase of securities or assets for the purpose of obtaining control by one or more entities of another entity or entities, whether fully or partially.
The Philippine Competition Commission (PCC), an independent quasi-judicial body, is created to implement the Act.
They must be Filipino citizens and residents of good moral character, with at least ten years of professional experience in fields such as economics, law, finance, commerce, or engineering. At least one must be a member of the Philippine Bar with ten years experience, and one must be an economist.
The term is seven years without reappointment. Initial appointments are staggered, with some commissioners serving five years.
Per se prohibited agreements include price fixing, bid manipulation, and market allocation. Also prohibited are agreements that substantially prevent, restrict, or lessen competition, such as limiting production or dividing markets.
Abuse of dominant position includes selling goods below cost to drive out competitors, imposing barriers to entry, setting discriminatory prices, unfairly restricting sales, among other anti-competitive behaviors that substantially lessen competition.
When the transaction value exceeds one billion pesos or meets thresholds set by the Commission, parties must notify and wait 30 days before consummating the agreement.
Administrative fines up to P100 million for a first offense and up to P250 million for subsequent offenses, penalties for failure to comply with orders, fines for supplying misinformation, and criminal penalties including imprisonment of 2 to 7 years and fines up to P250 million for anti-competitive agreements.
The Commission can investigate, issue subpoenas, conduct inspections, institute administrative and criminal proceedings, impose sanctions, order divestitures, issue injunctions, and monitor compliance.
Entities may be penalized by imprisonment ranging from two to seven years and fines between fifty million to two hundred fifty million pesos.
The PCC has original and primary jurisdiction over competition-related issues including enforcement of the Act, even when matters also involve sector regulators, although such regulators may be consulted.
The DOJ-OFC conducts preliminary investigations and prosecutions of criminal offenses arising under the Act but the implementation and enforcement of competition law lies primarily with the Commission.