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COMPETITION REFORMS IN KEY MARKETS FOR ENHANCING SOCIAL & ECONOMIC WELFARE IN DEVELOPING COUNTRIES (CREW PROJECT) CONSUMER UNITY & TRUST SOCIETY (CUTS). Convincing Policymakers & Garnering Greater Support for Competition Reforms. Rafaelita M. Aldaba

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convincing policymakers garnering greater support for competition reforms

COMPETITION REFORMS IN KEY MARKETS FOR ENHANCING SOCIAL & ECONOMIC WELFARE IN DEVELOPING COUNTRIES

(CREW PROJECT)

CONSUMER UNITY & TRUST SOCIETY (CUTS)

Convincing Policymakers & Garnering Greater Support for Competition Reforms

Rafaelita M. Aldaba

PHILIPPINE INSTITUTE FOR DEVELOPMENT STUDIES

13 MARCH 2013, JAIPUR, INDIA

legal framework background
Legal Framework -- background
  • No comprehensive & developed anti-trust law implemented by a central government body
  • Laws dealing with monopolies, combinations in restraint of trade, price control measures & consumer protection
    • Constitution, Revised Penal Code, Civil Code, special legislations, regulatory agencies
    • Senate & House Competition Bills since the late 1980s
  • EO 45 in June 2011: OFC under the Department of Justice as competition office
    • investigate all cases violating competition laws & prosecute violators
    • enforce competition law & policy; supervise competition
    • call on other government agencies for studies & assistance
  • Comprehensive legal framework: on-going deliberations at the House and Senate
  • Constraints: lack of culture of competition, weak consumer groups, inadequacies of the courts, political apathy/opposition
philippine institute for development studies
Philippine Institute for Development Studies

evidence-based research, information dissemination, advocacy

  • Independent, non-profit, government think tank engaged in long term socio-economic policy research
  • Toward A National Competition Policy for the Philippines (2000): examined state of competition, government policies & interface with competition policy, existing competition laws
    • Industry focus: manufacturing, cement, oil, telecommunications, banking, air transport, power, ports, shipping
    • Regulatory & competition interface, Philippine Antitrust framework
  • Regional seminars: Luzon, Visayas, & Mindanao
  • Competition forums in cooperation with other institutions: Manila
  • Competition watch: Policy Notes and Discussion Papers on cement, telecommunications, ports; micro studies linking competition, innovation, productivity studies (manufacturing)

http://publication.pids.gov.ph/details.php?pid=4385 ( assessment of competition, Aldaba)

http://publication.pids.gov.ph/details.php?pid=4944 (PLDT-Sun merger, Aldaba)

http://publication.pids.gov.ph/details.php?pid=4779 ( why cement prices remain high despite zero tariffs, Aldaba)

http://publication.pids.gov.ph/details.php?pid=3021 (ports Llanto, Basilio & Basilio)

http://publication.pids.gov.ph/details.php?pid=2061 (Medalla et al)

communicating with policymakers
Communicating with policymakers
  • Evidence-based research: solid analytical framework
    • Flexibility in approaches used, qualitative & quantitative, use competition framework available in empirical literature (data availability)
    • SCP, efficiency measures, game theory, conjectural variations
    • Micro data studies: competition, innovation, productivity links
  • Theories, empirical models: presented in layman’s terms
  • Timing of release of competition studies: position papers
  • Vigilance, continued monitoring of industries; engagement of media is important
    • Price data, newspaper reports of suspected anticompetitive acts, mergers
  • Relationship between PIDS & Policymakers/Lawmakers
    • MOA between OFC-DOJ & PIDS: research support, policy advise
    • PIDS: chairs OFC-DOJ’s Working Group on Planning
    • Senate & House: comment on competition bills & act as resource persons
  • Support by the government & political leadership at the highest level is crucial
    • Aquino: competition one of his priority legislations; Arroyo:not a priority
lessons from philippine experience
Lessons from Philippine Experience

In communicating with policymakers

  • evidence-based research is crucial
  • constant communication & dialogues with policymakers, briefings, involvement as Project Steering Committee members
  • regular discussion forums through seminars, brown bags, press briefings and the like where all stakeholders are invited, policymakers given a role, provide reactions & make presentations, engage in public discussions
  • information dissemination through PIDS Policy Notes : non-technical simplified version of discussion papers

Limitations

  • Limited financial & human resources
    • PIDS a very small organization with a small subsidy from the government, resources compete for many other research projects
    • Expertise in infrastructure: water, telecommunications, government procurement
  • Data availability: government regulators, National Statistics Office, Securities & Exchange Commission, UN COMTRADE data
    • Firm level data is difficult to obtain, no time series data (Census every 5 years, firm identification is prohibited by law, broad sector classification)
    • Cooperation among research & government agencies especially in data exchange
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