OECD kpcdb

1. Scope

 

The Competition Act prohibits conducts that amount to abuse of dominant position in any market in Singapore. Section 47 provides an illustrative list of abuse of dominant position: predatory behaviour towards competitors; limiting production, markets or technical development to the prejudice of consumers; applying dissimilar conditions to equivalent transactions with other trading parties (thereby placing them at a competitive disadvantage); or subjecting the conclusion of contracts to acceptance of supplementary obligations not related to the contract. It must be noted that the Section 47 Prohibition applies to vertical agreements

 

2. Assessment

 

A business is deemed dominant where it has substantial market power. In assessing whether a business is dominant, the extent to which the business has the ability to profitably sustain prices above competitive levels or to restrict output or quality below competitive levels is considered.

 

Determining market dominance: Although there are no presumptive rules, the CCS considers a market share above 60% as a threshold that is likely to indicate the existence of market dominance in the relevant market.

 

In assessing whether a business is dominant, the extent to which the business has the ability to profitably sustain prices above competitive levels or to restrict output or quality below competitive levels is considered. In determining dominance, non-market-share-factors including presence of existing competitors, potential competitors, existence of powerful buyers and economic regulation are considered.

 

Abuse of dominance: To establish whether a conduct by a business in market dominant position amounts to an abuse, the CCS considers whether the conduct, for instance, removes an efficient competitor, limits competition from existing competitors or excludes new competitors from entering the market. The CCS also takes into consideration whether the dominant business is able to provide an objective justification for its conducts and whether the conduct is proportionate to the benefits claimed.

 

Notification for guidance or decision is also possible for conducts regulated under Section 47 (abuse of dominant position). However, notification for guidance or decision is not possible for prospective conduct. No provisional immunity from financial penalty is conferred for notification of conduct in relation to the Section 47 Prohibition. Where the CCS has given guidance that an agreement is unlikely to infringe the Section 34 Prohibition or is likely to be exempt under a block exemption, immunity is conferred in that no further action may be taken with respect to the notified agreement in relation to the Section 47 Prohibition, unless certain conditions are met as set out under Section 52 (2) (e.g., CCS has reasonable grounds to suspect that the information on which it based its guidance was incomplete, false or misleading in a material aspect)

 

3. Remedies and sanctions

 

Under Section 69, where the CCS has made a decision that parties have infringed Section 47, it may require the parties to modify or cease the conduct infringing Section 47. Financial penalty may be imposed up to 10% of the turnover of the business of the undertaking in Singapore (maximum three years).