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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

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Convincing Policymakers & Garnering Greater Support for Competition Reforms

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  1. 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

  2. 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

  3. 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)

  4. 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

  5. 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

  6. Thank You!

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