Happy Rayna Stephany, Yanuar Pribadhie
With less than two years before the ASEAN Economic Community (AEC) comes into effect in 2015, one major challenge facing AEC and Indonesian businesses is harmonization of antitrust laws in the region. So far ASEAN has been slow in taking action on this issue.
Nawir Messi, the Head of the Indonesian Business Competition Supervisory Commission (KPPU), explained that given the fact AEC opens up markets and liberalizes restrictions on business transactions between ASEAN members, the absence of harmonized antitrust laws may lead to problems in the domestic market.
“The absence of harmonized laws will create difficulties for the respective business competition oversight institutions in ASEAN in repressing unfair business practices,” said Nawir.
The problems associated with cross-border transactions will likely intensify particularly as some ASEAN members such as Brunei Darussalam, the Philippines, Cambodia, Laos, and Myanmar do not have an antitrust legal framework in place. However, Nawir continued, these countries are working on this issue and will soon have one in place.
Nawir also criticized Indonesia as being too slow in its own preparations. Nawir added that the Indonesian antitrust law also needs revision, particularly the definitions of “business” and “relevant market” .
“Current business players are not only domestic but also foreign. The same thing applies to relevant market,” Nawir further explained.
Ian McEwin, Managing Partner of Competition Consulting Asia, also sees the absence of harmonized laws as the main issue for antitrust laws within ASEAN. There are gaps between laws in each country, with one of the main gaps being abuse by dominant market players.
Ian explained that in Indonesia dominance issues relate to monopoly or monopsony and abuse of dominant position
The prohibited activities under the concept of monopoly or monopsony involves control of production, markets, or acquiring goods and services. Abuse of dominant position arises when a business controls more than 50 percent of a related market.
As evidence of differing regulatory approaches, the applicable Singapore laws do not make this distinction. Singapore has only one type of domination, abuse of dominant position. This definition covers dominant companies in overseas markets, but not exploitative pricing.
With respect to these differences, McEwin comments he is yet to see any commitment from ASEAN to harmonize cross-border policy and antitrust laws.
“Antitrust law is like a football game. It needs code of conduct for the players,” concluded McEwin.
(hot/kc)
Happy Rayna Stephany, Yanuar Pribadhie
With less than two years before the ASEAN Economic Community (AEC) comes into effect in 2015, one major challenge facing AEC and Indonesian businesses is harmonization of antitrust laws in the region. So far ASEAN has been slow in taking action on this issue.
Nawir Messi, the Head of the Indonesian Business Competition Supervisory Commission (KPPU), explained that given the fact AEC opens up markets and liberalizes restrictions on business transactions between ASEAN members, the absence of harmonized antitrust laws may lead to problems in the domestic market.
“The absence of harmonized laws will create difficulties for the respective business competition oversight institutions in ASEAN in repressing unfair business practices,” said Nawir.
The problems associated with cross-border transactions will likely intensify particularly as some ASEAN members such as Brunei Darussalam, the Philippines, Cambodia, Laos, and Myanmar do not have an antitrust legal framework in place. However, Nawir continued, these countries are working on this issue and will soon have one in place.
Nawir also criticized Indonesia as being too slow in its own preparations. Nawir added that the Indonesian antitrust law also needs revision, particularly the definitions of “business” and “relevant market” .
“Current business players are not only domestic but also foreign. The same thing applies to relevant market,” Nawir further explained.
Ian McEwin, Managing Partner of Competition Consulting Asia, also sees the absence of harmonized laws as the main issue for antitrust laws within ASEAN. There are gaps between laws in each country, with one of the main gaps being abuse by dominant market players.
Ian explained that in Indonesia dominance issues relate to monopoly or monopsony and abuse of dominant position
The prohibited activities under the concept of monopoly or monopsony involves control of production, markets, or acquiring goods and services. Abuse of dominant position arises when a business controls more than 50 percent of a related market.
As evidence of differing regulatory approaches, the applicable Singapore laws do not make this distinction. Singapore has only one type of domination, abuse of dominant position. This definition covers dominant companies in overseas markets, but not exploitative pricing.
With respect to these differences, McEwin comments he is yet to see any commitment from ASEAN to harmonize cross-border policy and antitrust laws.
“Antitrust law is like a football game. It needs code of conduct for the players,” concluded McEwin.
(hot/kc)