Economic Sector

Last updated: Tuesday, February 19, 2019


Concerns about Multiple Sublicenses from National Competition Committee Model

Posted: Friday, May 04, 2018

The National Competition Committee should be an independent governmental body rather than a ministerial affiliate, said at a Consultative Workshop on Revised Law on Competition, raising concerns about the birth of multiple sublicenses, monopolistic behaviours and power abuse in the public service. The event was jointly held by the Economic Commission of the National Assembly in combination with the Ministry of Industry and Trade and the United States Agency for International Development (USAID) in Hanoi.

Mr Nguyen Duc Kien, Vice Chairman of the Economic Commission, said, compared with the draft law with nine chapters and 121 articles submitted to the National Assembly at the 4th meeting session, this revised draft comprised of 10 chapters and 123 articles. Reviewed content were then reported to and approved by the National Assembly Standing Committee.

In addition, the Economic Commission, the Ministry of Industry and Trade and other related agencies also seriously studied 110 opinions from parliamentarians discussing in breakout sessions and 24 opinions from parliamentarians debating at panel sessions during the 4th meeting series of the law-making National Assembly. Two consultative workshops on the draft law were also held in Da Nang City and Ho Chi Minh City, attended by representatives from the National Assembly’s bodies, provincial/municipal parliamentarian delegations in central and southern regions, representatives from relevant agencies, business associations, enterprises and specialists in competition law. “Therefore, we have a big content leap in this meeting on the revised draft Law on Competition,” said Mr Kien.

Mr Tran Huu Huynh, Chairman of the Vietnam International Arbitration Centre (VIAC), said, the National Competition Committee is an affiliated agency of the Ministry of Industry and Trade, not an independent body. There is a likelihood that this agency administers competition on one hand and it settles competition proceedings on the other. It seems to be a player and a whistle-blower at the same time. In addition, according to the draft Competition Law, enterprises must submit a dossier notifying the National Competition Committee before conducting an economic concentration. This is a disguised form of sublicense. This will hinder businesses in production and business operations.

Mr Terry Calvani, an American specialist in competition laws and former Chairman of the United States Federal Trade Commission (FTC), said that the FTC structure is composed of five commissioners appointed by the President. Each commissioner serves for a seven-year term. No one is authorised to dismiss any of them from office unless they break the law. This mechanism shows that the FTC has a very high autonomy in decision making and even the President has no power to fire them when they are in office. This is to make sure that every decision of the American competition body is truly independent of the other authorities.

In addition, the US experience shows that the competition authority should not be overambitious of dealing with competition law violation cases arising outside the territory because it cannot have sufficient resources to force offenders to perform a reimbursement or to remedy consequences according to their original agreement. This recommendation is very essential to Vietnam, a country that is just beginning to form the National Competition Committee as its resources and experience in dealing with economic cases with foreign elements are not very well-established, said Mr Terry Calvani.

Deputy Minister of Industry and Trade Tran Quoc Khanh said that, in principle, the Ministry of Industry and Trade is assigned by the Government to set up the National Competition Committee affiliated to the ministry. But, this agency will strictly adhere to market disciplines and will not abuse power or issue sublicenses beyond its competence because any decision by the National Competition Committee can be brought to court for wrongdoing.

Van Nam

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