The Association of Southeast Asian Nations (ASEAN) Economic Ministers agreed to strengthen competition policy and enforcement cooperation at the 54th ASEAN Economic Ministers' Meeting held in Siem Reap, Cambodia on 13 to 15 September 2022. The following cooperation initiatives were discussed at the meeting:
- ASEAN Heads of Competition Agencies' Joint Statement on Maintaining Competition Policy in Post-Pandemic Economic Recovery
- Guiding Principles for Negotiating the ASEAN Framework Agreement on Competition
- ASEAN Investigation Manual on Competition Policy and Law for the Digital Economy
- ASEAN Guidelines for Sharing on Merger Cases
- Study on Commonalities on Differences across Competition Legislation in ASEAN and Areas Feasible for Regional Convergence.
Businesses that operate in the Southeast Asia region are encouraged to undertake a timely review of their operations to ensure that they do not fall foul of competition laws.
ASEAN Heads of Competition Agencies' Joint Statement on Maintaining Competition Policy in Post-Pandemic Economic Recovery
The statement was issued on 15 March 2022 to reiterate the importance for ASEAN to consider competition policy and its role in supporting economic recovery. The ASEAN Heads of Competition Agencies acknowledged the need for ASEAN to adopt a common understanding on the enforcement of competition law to maintain and improve competition in the region. They also committed to taking the following actions:
- Support economic recovery by focusing enforcement efforts on strategic markets and industries that are important for economic recovery, and streamlining processes to make them business-friendly
- Strengthen advocacy efforts to policymakers from an early stage to ensure that competition issues form part of their considerations in developing new policies and regulations
- Provide the government and other relevant legislative bodies with advice and recommendations on competition law and policy
- Ensure that anti-competitive activities do not take place under the guise of economic recovery, and cooperate with other competition authorities as appropriate to curtail such anti-competitive activities
- Enhance their respective national and regional capacity to assess and handle competition issues relating to digital markets
- Strengthen their respective outreach to small and medium-sized enterprises
- The statement was welcomed by the ASEAN Economic Ministers in support of the region's post-pandemic recovery efforts.
Guiding Principles for negotiating the ASEAN Framework Agreement on Competition
The ASEAN Economic Ministers adopted the guiding principles and launched the negotiations for the framework at the meeting. The framework is aimed at providing a fair and competitive business environment through cross-border cooperation between competition agencies, internalization of competition policy into regional and domestic economic policies, and other initiatives to deal with competition issues of mutual interest. It was acknowledged that as markets become more integrated in the Southeast Asia region, cooperation between ASEAN competition agencies will become more vital, as cooperation will help save resources and avoid duplication of efforts, provide experience-sharing, and assist to provide consistency of decisions in resolving anti-competitive conduct.
ASEAN Investigation Manual on Competition Policy and Law for the Digital Economy
The introduction of the investigation manual is a clear indication that ASEAN competition agencies expect more competition issues of a cross-border nature to arise in the digital sector. As ASEAN member states focus on sustaining the wave of business digitalization catalyzed by the COVID-19 pandemic, it is unsurprising that ASEAN competition agencies are turning their focus to the digital sector. Additionally, under the ASEAN Digital Masterplan 2025, the digital sector is expected to accelerate economic integration between ASEAN member states. It is expected that the investigation manual will be published by the end of 2022.
ASEAN Guidelines for Sharing Merger Cases
The ASEAN Economic Ministers also noted the progress of the development of this set of guidelines, which will serve as a reference to develop the ASEAN Portal on Merger Cases to be established by 2023. This is a key deliverable under Strategic Goal 3 of the ASEAN Competition Action Plan 2021-2025.
Study on Commonalities on Differences across Competition Legislation in ASEAN and Areas Feasible for Regional Convergence
Lastly, the ASEAN Economic Ministers also reviewed the findings of this study, which was published in 2021 to provide a comprehensive overview of the substantive competition laws in ASEAN as well as recommend short to medium priorities to be undertaken towards convergence. The study highlighted that the alignment of competition policy objectives is key to regional convergence, as they will impact the enforcement priorities set by ASEAN competition agencies, the manner in which the laws are applied, and decisions regarding remedies and sanctions. The study recommended short term priorities that could have an immediate impact on regional convergence. These include the development of regional policy objectives and regional guidelines on cartel provisions in ASEAN competition laws in order to align the interpretation of the laws and enforcement practices. The study also recommended medium-term priorities focused on the development of regional guidelines that explain anti-competitive agreements and abuse of dominance provisions.
It is clear from the 54th ASEAN Economic Ministers' Meeting that ASEAN as a region is more committed to strengthening competition policy and cooperating more effectively. That is significant because, as Southeast Asian economies become more integrated, business activities will increasingly have an impact across the ASEAN region. On the one hand, business should benefit from the extra commitment to better regional competition enforcement– for example, increased consistency which is key for legal certainty and predictability. On the other hand, more cooperation and information sharing between ASEAN competition authorities will mean more exposure for businesses. It is therefore a good time for businesses that operate in the Southeast Asia region to consider competition compliance, including on a regional basis.
Please do not hesitate to get in touch with us if you wish to discuss how this development may impact your business operations in Southeast Asia.