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Kathrina G. Gonzales, Maureen Ane D. Rosellon, and Josef T. Yap 12 September 2012

UNFAIR TRADE PRACTICES KEY FINDINGS of SURVEY, analysis and recommendations the case of the Philippines. Kathrina G. Gonzales, Maureen Ane D. Rosellon, and Josef T. Yap 12 September 2012. ● Survey respondents. Distribution of respondents by sector.

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Kathrina G. Gonzales, Maureen Ane D. Rosellon, and Josef T. Yap 12 September 2012

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  1. UNFAIR TRADE PRACTICESKEY FINDINGS of SURVEY, analysis and recommendationsthe case of the Philippines Kathrina G. Gonzales, Maureen Ane D. Rosellon, and Josef T. Yap 12 September 2012

  2. ● Survey respondents Distribution of respondents by sector

  3. Misleading Advertisement had highest response in this query. Which practices do you think are unfair trade practices?

  4. ●However it seems Unfair Pricing is the UTP that is most encountered Which of these practices have you ever come across in the course of doing business/in the markets where you shop and/or as regards the products/services you buy/in your country?

  5. UTPs are considered to be moderately to highly widespread How widespread are these UTPs in the normal business/in the markets where you shop and/or as regards the products/services you buy/use in our country?

  6. ●General Perception is that UTPs still prevail Do such practices still prevail or they have been resolved? (in percent)

  7. ●General Perception that impact of UTPs is negative Do you think these UTPs are negatively affecting the business, especially small and medium-sized enterprises (SMEs)/ the consumer interests/ business environment in our country in any way? (in percent)

  8. And the impact of UTPs is moderate to significant To what extent do you think that the business/ consumer/overall business environment in our country is affected by the existence of such practices? (in percent)?

  9. ○ Existence of Monopoly has highest frequency although not majority What do you think is the cause of such UTPs?

  10. ○Business Firms are generally not aware of important laws related to UTPs Name any such rules, regulations, or laws you know.

  11. ○Business firms seem to be ambivalent about UTPs Do you think that the existing rules, regulations or laws do a sufficient job to check all unfair trade practices and protect the legitimate rights and interests of the business in general and those of SME’s in particular/protect consumer welfare and competitive process in our country?

  12. ○Business and Consumer Associations are apparently more proactive. Do you recommend that a law or regulation should be enacted specifically to check these practices and protect the consumer more effectively?

  13. ○There is apparent reluctance on the part of firms to counter UTPs Will you be willing to sign investigation reports as third parties or testify for the Department of Trade and Industry (DTI)/the court if necessary or requested by them?

  14. There is apparent reluctance on the part of firms to counter UTPs Will you be ready to cooperate with investigator(s) of the DTI during the investigation process or with the court during hearings?

  15. Key Findings • Many respondents indicate that UTPs are moderately to highly widespread • Overwhelming majority believes that UTPs have adverse impacts on business transactions and consumer welfare. • Not many are aware of the legal remedies against UTPs. • Business firms interviewed are reluctant to participate in legal action against UTPs. • Reluctance implies either of two things: 1) there are gaps in the legal infrastructure to address B2B UTPs; 2) While businesses are aware of the adverse impacts of UTPs, they do not seek to “rock the boat”.

  16. Key Findings • Adequate laws to address B2C cases • Not many cases are filed: only 3,249 in 2010 and 4,720 in 2011 • Case study on misleading advertisement: “DTI-National Capital Region’s records show that numerous administrative complaints have been filed against Aowa Electronic Philippines, Inc. by different consumers, or a total of at least two hundred and seventy-three (273) from the year 2001 until 2007.” Case was filed only in 2008. • Capacity of DTI to implement law is limited

  17. FGD inputs • FGD participants: representatives from the government, consumer and industry associations • On low awareness on laws for UTPs: Firms/establishments may not be as aware as the officers of industry associations • There is no specific agency or department that handles B2B complaints; Available legal remedy for B2B UTPs – The Consumer Act allows the Department of Trade and Industry to act on B2B complaints if these can be shown to impact on consumer welfare • Possible private sector initiative: an industry association may at first mediate if a member firm is reported to be practicing unfair business acts

  18. Policy Recommendations • Greater information dissemination on existing laws related to UTPs • Enhance capacity of Department of Trade and Industry to handle UTP cases • Allow industry associations to mediate UTP cases among their members but provide associations with capacity • Closer coordination between business organizations and consumer groups and government • Is the private sector its own worst enemy? Lack of culture of competition • Competition policy and competition law

  19. 감사합니다Maraming Salamat!!!Terima Kasihขอบคุณครับありがとう Cảm ơn rất nhiều ຂອບໃຈຫລາຍໆ 謝謝你。 THANK YOU !!!

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