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Competition Policy for Shared Prosperity

Posted: 2017-10-11

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Conference Note
Competition Law and Policy: SMEs and the Digital Economy (S.Quimbo)
Competition Policy and SME Development (E.Medalla)
Leveraging Competition Policy for SME Development and Shared Prosperity (E.Garcia)
Innovation in Philippine Business & Industry (J.Albert)
EU Competition Policy & the Digital Market (T.Bernabe)
Competition Policy in the Digital Economy: Assessing the competitive environment and scrutinizing anti-competitive behavior in digital markets (I.Villamil)

The Asian Institute of Management Rizalino S. Navarro Policy Center for Competitiveness (AIM RSN PCC), in partnership with the Konrad-Adenauer-Stiftung (KAS) held a conference titled “Competition Policy for Shared Prosperity: Developing SMEs and Maximizing the Digital Economy” on 11 October 2017 at the Cervantes function room, Discovery Primea, Makati City.

The conference commenced with a keynote speech by Philippine Competition Commission Commissioner Stella Luz A. Quimbo. She gave a brief primer on the current status of competition law and the role of the Philippine Competition Commission (PCC). She also highlighted the challenges being faced by the PCC with regards to awareness and capacity. Comm. Quimbo then shifted her discussion to the interplay between Small and Medium Enterprises (SMEs) and competition law. She concluded by talking about the emerging digital economy and how this would influence the firm’s market power and thus competition law.

After Commisioner Quimbo’s keynote speech, the conference proceeded to the panel discussion on Competition Policy and SME Development. Erlinda Miranda, Senior Research Fellow of the Philippine Institute for Development Studies, highlighted key aspects of SMEs such as their share of employment, output, and firm count in the Philippines. She continued by stating that the high entry and exit rate of SMEs is the main source of dynamism and innovation in the sector. She said that SME development policy is a prerequisite for an effective competition policy because it lays a good foundation for a competitive environment.

Emmanuel M. Garcia, Economist of the AIM RSN PCC, focused on how SMEs reinforce an inclusive economy. He said that SME competition fosters innovation which then provides more high quality jobs. He continued by saying that competition policy complements broader reforms such as those targeting market distortions, ease of doing business, and access to finance, legal advice, and technology. He ended by stressing that the PCC must remain independent and prioritize sectors that heavily impact shared prosperity.  

An open forum followed, moderated by Atty. Anthony A. Abad, President and CEO of TA Trade Advisory Group, Inc. A healthy discussion developed on the topics of competition law, the interplay of SMEs and competition law, and the emerging digital economy.

The second session focused on the role of competition policy in the digital economy. It was moderated by Dr. Francisco Roman, a faculty member at the Asian Institute of Management.

Mr. Tito Bernabe, part time lecturer on EU Law and European Economic Integration at the European Studies Program of the Ateneo de Manila University, discussed some of the similarities and differences between the EU Competition Law and the Philippine Competition Act, focusing on provisions on anti-competitive agreements, abuses of dominant market positions, and mergers in particular. He then mentioned some of the antitrust and merger cases that the EU Competition Commission has dealt with in the digital market as an example of the emerging digital economy and competition law.

Mr. Jose Ramon Albert, Senior Researcher Fellow at the Philippine Institute for Development Studies, discussed innovation in Philippine business and industry. He mentioned that innovation and competitiveness are two interrelated catalysts of economic growth. He noted that countries with competition policies and/or law tend to have higher scores in the Global Competitiveness Index and Global Innovation Index. Dr. Albert also mentioned the results of 2015 Survey of Innovation Activities (SIA), conducted by PIDS with assistance from Philippine Statistics Authority. Parts of his recommendations, based on the survey, include the need for a national innovation framework to facilitate interactions in innovation ecosystem and broadening the government support on innovations beyond S&T/R&D.

Ms. Isabel Villamil, Economist at the Philippine Competition Commission, focused on assessing the competitiveness of digital markets and identifying anti-competitive behaviors in these markets. She laid out the main characteristics of the Digital Economy: network effects and multi-sided markets, importance of data, and rapid change and innovation. She then proceeded on identifying ways of regulating the digital economy. Lastly, she outlined some of the emerging issues in the digital economy that competition authorities must heed.

The open forum discussion that followed tackled related topics such as technological innovations from the business sector and the needed supportive policies, blockchain technology, EU competition law, and once again the duality of SMEs and competition law.

To cap the lively discussion, Senior Program Manager Tonette de Jesus of Konrad-Adenauer-Stiftung (KAS) highlighted the need for healthy competition in the Philippine economy and posed questions about the PCC’s role in fostering a competitive environment as food for thought.


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