Competition Law 2018: In line with international trends and practices

Competition Law 2018: In line with international trends and practices

The morning on September 13, 2018 under the Australian Support for Economic Reform Program (Aus4Reform), the Competition and Consumer Protection Department (Ministry of Industry and Trade) organized a workshop on the dissemination of the Competition Law 2018.

During the period 2017-2018, the Aus4Reform Program has provided a number of support to help develop the Competition Law (revised). Compared to the Competition Law 2004, the Competition Law 2018 is based on a combination of economic thinking and legal thinking, with many progressive innovations, ensuring access to world standards. The law includes a number of new regulations on controlling anticompetitive behavior and controlling economic concentration.

According to Nguyen Sinh Nhat Tan, Director of the Competition and Consumer Protection Department, said that compared with the Competition Law in 2004, the new law would expand the scope of regulation and subjects of application such as business organizations and individuals, including enterprises engaged in the production and supply of public utility products and services, enterprises operating in the State monopolies and branches, public non-business units and foreign enterprises operating in Vietnam; professional associations operating in Vietnam and related domestic and foreign agencies, organizations and individuals.The amendments and supplements to the new Competition Law include: extending the scope of regulation and subjects of application of the Law and extending the scope of regulation of competition acts inside and outside Vietnam when such acts have affected or likely to have a restrictive effect on competition in the Vietnamese market.

Mr. Nguyen Sinh Nhat Tan, Director of the Competition and Consumer Protection Department

Ms. Tran Phuong Lan, head of Competition Policy Supervision Bureau, explained in detail: "In the past, the Competition Law 2004 only regulated restrictive behaviors on competitive focus in the Vietnamese market, but the Competition Law 2018 has responded to and dealt with issues that are trending around the world, approaching the way the competition authorities on the world. Consequently, any acts of restriction of competition or economic concentration occurring anywhere outside the territory of Vietnam would have a significant negative impact on competition in the Vietnamese market, which are subject to the Competition Law 2018. This point shows that the new law has approached and kept pace with the development trend of the economy, as well as the tendency to increase the operation of multi-companies. More and more restrictive competition agreements are taking place in the foreign market.

Fundamental change of approach to finalizing centralized control regulations. The new Competition Law fundamentally changed the legislative thinking, that the  Competition Law 2018 recognizes that economic concentration is a natural right of the business, contributes to improve efficiency in business operations.

The Competition Law 2018 does not provide for a ban on economic concentration mechanically based on the combined market share of enterprises participating in economic concentration that accounts for more than 50% of the relevant market as defined in the Competition Law 2004. In contrast, the law only prohibits enterprises from performing economic concentration when the economic concentration acts to cause or have the potential to cause significant negative effects on the market.

Reorganizing the Competition Authority to enhance the effectiveness of the implementation of the Law establishing the National Competitiveness Committee on the perspective of reorganizing competition authorities under the Competition Law 2004 including the Competition Authority (now the Competition and Consumer Protection Department) and the Competition Council (including the help desk is the Office of Competition Council). This is an important new point for enhancing the effectiveness of the competition authority. The model of the National Competition Committee is in line with the global trend and helps to reduce the clue, streamline the machinery, ensure efficient operation

Compared with the Competition Law 2004, the new law also improved the order and procedures in competition law, the law was completed in a simple way, many activities were shortened and more clearly defined. as well as responsibility for conducting legal proceedings and dealing with cases of restraint of competition.

The law will take effect on July 1, 2019.