Competition authorities get chummy

Top of the list of concerns right now are telecommunications’ monopolies, which frustrate economic growth and smaller business development, and making medicines more accessible to the poor.

These and other thorny business issues are up for debate in Cape Town currently where hundreds of international heavyweights in the field of competition law and policy are putting their heads together to devise strategies to combat anti-competitive practices.

The Competition Commission and Competition Tribunal of South Africa are hosting this fifth annual conference of the International Competition Network (ICN).

Experts from the developed and developing world, with a strong presence from former communist countries, are sharing information on how to ensure compliance in general and iron out inefficiencies in the regulation of cross-border mergers and cartels.

David Lewis, chairperson of the competition tribunal, told Moneyweb the emphasis, at this stage, is not to harmonise international law but to develop best practices and learn from others’ experiences.

Markets are international but enforcement is national and competition authorities in each country don’t want companies to take advantages of gaps in the system to the detriment of local businesses and consumers, he said.

The idea is to promote a uniform way of assessing the facts, while competition authorities also want to catch those contravening anti-competition regulations and legislation more effectively.

It is clear, too, that an annual conference is not the only point of contact between international competition bodies.

In addition to engaging in informal information sharing and technical assistance programmes, representatives attend workshops through the year designed to tackle specific problems.

On Wednesday, delegates highlighted the importance of developing a “culture” within companies in order to reduce anti-competitive behaviour.

Lewis said this culture is improving in South Africa, partly because there has been “quite robust” enforcement in the mergers’ arena. “I think our presence is factored into business decisions now,” he said.

In addition, South Africa has been boosting its intellectual capital in this area. A few years ago, international experts had to be called in for guidance, while lately the “indigenous capacity” in this field has increased.

Illustrating the increasing involvement of competition authorities in the global economy, chairman of the ICN Dr Ulf Böge (also head of the Federal Cartel Office) noted that the number of participants in the ICN has grown from about 14 to not far off 100 in five years.

“The special endeavours to involve the developing and transition countries take into account the fact that in the end we can only fully benefit from the advantages of globalisation if the principle of competition is implemented to the full,” he said.

Böge said the ICN is the “clubhouse” of competition authorities and that they are “one team working together with the mutual aim of a worldwide improvement of competition regimes and their possible convergence”.

It’s not an exclusive club, though, he said, with others – like lawyers and business representatives – welcome to share their suggestions.

One business that has taken advantage of the offer is Philips. Paul Lugard, a senior vice-president with the company, said among the recommendations his organisation has for competition authorities around the world is to consult and communicate with business.

There is a “delicate line” between transparency and “counterproductive advocacy”, he told delegates as he argued in favour of an approach that would give companies early insight into decisions and reports so that they can prepare a response ahead of public interest in an issue.