Senate approves fair competition bill on final reading

The Senate on Monday passed on third and final reading a bill intended to promote fair competition by penalizing practices like price fixing.
 

Voting 13-0, the Senate approved Senate Bill No. 2282, which aims to shield small business owners and consumers from companies engaged in unfair business practices that lead to higher prices.

 

"The bill puts in place measures that will protect the welfare of businesses and protect honest, hard-working entrepreneurs against abuse of dominance and position, and other unfair practices that put both Filipino businesses and their consumers at risk," Sen. Paolo Benigno "Bam" Aquino IV, the principal author of the measure, said.

 

"A fair competition policy will level the playing field for Filipino businesses and allow more Filipinos to exercise their entrepreneurial spirit," he added.

Punishment for price fixing

 

Under the bill, “it shall be a criminal offense for entities to enter into any agreement with the object and effect of unreasonably and substantially preventing, restricting and lessening competition.”

 

Among the practices to be penalized under the bill are the following:

 

 

Under the bill, those found to be engaged in unfair competition will face a fine ranging from P50 million to P200 million.

 

The measure also states that any unfair competitive agreement between competitors shall be penalized with imprisonment from two to five years, or fined an amount not less than P100 million but not more than P200 million or both, with "the penalty of imprisonment being imposed upon the officers and directors of the entity."

 

The bill also mandates the establishment of a Fair Competition Commission (FCC) tasked to promote competition, ensure consumer welfare, and penalize abuses of market power.

 

"We believe that the Fair Competition Act is all at once pro-poor, pro-people, and pro-business. It safeguards the welfare of businesses, large and small, and protects honest, hardworking entrepreneurs," Aquino said.

 

The measure was approved on third reading after the inclusion of an amendment by Acting Minority Leader Vicente "Tito" Sotto, which further empowers the proposed commission to consider whether market entities selling their products below cost "are doing so in good faith to meet or compete with the lower price of a competitor."

 

SBN 2282 is co-authored by Senators Sergio Osmeña III, Teofisto "TG" Guingona III, Miriam Defensor-Santiago, Jinggoy Ejercito Estrada and Antonio Trillanes IV. 

Law seen to lower prices

 

Senate President Franklin Drilon, meanwhile, welcomed the passage of the bill, saying that "having a competition law will lead to lower prices, higher quality of products and services, and more choices for consumers, as fostering a competitive economic environment spurs market efficiency and innovation."

 

Drilon also said that the Fair Competition Act contributes to Congress' goal of passing a package of priority economic measures to improve the Philippine business climate, boost investment and ensure macroeconomic and fiscal sustainability to prepare the country for the ASEAN economic integration in 2015.

 

He noted that "the Philippines remains the only member of the ASEAN-5 countries (which includes Indonesia, Malaysia, Singapore, and Thailand) where a competition law is not already in place."  — JDS, GMA News