Academic journal article Asia Pacific Law Review

The Choice of Competition Law and the Development of Enforcement in Asia: A Road Map towards Convergence

Academic journal article Asia Pacific Law Review

The Choice of Competition Law and the Development of Enforcement in Asia: A Road Map towards Convergence

Article excerpt

I. Introduction

Since the United States (US) enacted its first antitrust law,1 the Sherman Act, in 1890, more than 120 countries have adopted competition laws or similar types of anti-monopoly laws. In particular, a significant number of developing countries in Asia have recently adopted or fully amended their competition laws.2 It is also noteworthy that most Asian countries have developed their competition laws in a piecemeal way over the past decade. Although their legal, economic, and cultural backgrounds are dissimilar, the frameworks of competition law in this region appear to have some common features. Competition policymakers in Asia often borrow competition law structures from other competition regimes, primarily those of the US and the EU, and then blend them with the structures of earlier adopters of competition law in Asia, such as the Republic of Korea (hereinafter, Korea) and Japan.

Although the level of competition law enforcement in Asia is insignificant at the present time, it is worth noting that efforts have been made toward effective enforcement in an effort to improve the implementation of competition law through cooperation between competition authorities. In addition, although the background of competition legislation varies among Asian countries, there are some shared viewpoints underlying the substantive laws and their enforcement that have arisen due to an increasing volume of trade, which in turn, is leading to the globalisation of their national economies. The globalisation of domestic markets and economies makes it inevitable that competition policymakers and agencies in Asia will improve their competition law enforcement as they learn about the competition regimes of their neighbours. The trends in thinking about competition law and policy in Asian countries indicate that the creation of a competition law system is crucial and unavoidable to ensure both fair competition in the domestic market and free trade in the global market.3 This implies that Asia eventually will play an important role in the evolution of harmonisation of competition law throughout the developing world,4 particularly as their volume of trade in the Asian market increases.

The adoption of a competition policy offers a number of advantages to emerging economies, including increases in foreign direct investment and licensing agreements.5 The widespread ideas regarding the structure of competition law that have arisen from globalisation may also lead to localised harmonisation due to the interdependence of the competition regimes within Asia. This reduces the possibility of conflicts among them as well as the costs of investigation.6 In order to consider the potential development of competition law in Asia, this article aims to discuss its origins and its similarities within Asia. It further deliberates on the existing problems in the enforcement of competition law and suggests proposals for cooperation between competition authorities that will improve effective enforcement in Asia and thereby support Asian countries in the development of their competition policies and the achievement of localised convergence.

This article contains six sections including the introduction. Section 2 illustrates the historical development of competition law and policy in Asian countries from a comparative perspective. In Section 3, we examine the common themes in competition law in these countries, including their statements of the objectives of their competition laws and their market-share-based presumptions of market dominance; these provisions are unique, but also make it easier to harmonise competition rules in Asia. Section 4 then points out existing problems and suggests proposals for effective implementation through aggressive enforcement. In particular, the further development of the culture of competition, for example, the provision of clear guidance arising from a simplification of the objectives of the laws, is one of the crucial elements in these suggestions. …

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