OECD kpcdb

1. Scope

 

Article 7 of the Competition Law prohibits the use of a dominant position to:

 

• restrict production or sales of goods;
• fix excessive prices unreasonably;
• price discriminate against enterprises selling similar kinds of product;
• undertake predatory pricing;
• sell its products on condition of excluding its competitors;
• include conditions that are not relevant to the subject of the contract or that are disadvantageous to the contracting party;
• attach goods that are not included in selling goods and products.

 

The dominant position may be single or collective.

2. Assessment

Article 5.1 defines natural monopoly as when a single entity alone accounts for the total supply of particular goods to the market at the lowest minimum social cost.

 

According to Article 5.2, market dominant position is defined as a single entity or a group of businesses having over one third of the market share.

 

Under Article 5.3, enterprises that have lower market share than the above threshold, but capable of hindering market entry of other enterprises or driving them out of the market may also be deemed to have market dominant position.

 

The market dominance for these enterprises is established within the scope of product, geographical limit of market, market concentration and market power.

 

There are no further guidelines or guidance from the AFCCP to assess dominant position or how to assess the prohibited conducts.

3. Remedies and sanctions

Under Article 27, enterprises engaged in prohibited activities of monopolistic or dominant position, are subject to a fine of up to 4% of the sales revenue of the previous year and confiscation of all income and property illegally earned.

A cease and desist order may be imposed against an abuse of dominance.

 

The AFCCP may also make a proposal to the relevant government offices to annul the entity’s permission to operate.

 

 

* This information is based on Competition Law in Asia-Pacific: A Guide to Selected Jurisdictions (2018).