Ensuring healthy business competition

Co-operation between the Government’s Competition Authority and regulatory bodies in sectors needs to be promoted to ensure a healthy competitive business environment in Viet Nam, says Vu Ba Phu, vice head of the Viet Nam Competition Authority (VCA).

Attending a seminar org-anised yesterday by the Industry and Trade Ministry’s VCA and Swiss Competition Commission, Phu said that although Viet Nam’s Competition Law was passed in 2004 and took effect one year later, firms, as competitors, were still confused which institutions they should go to when they met competition-related issues.

The Competition Law applies to all sectors, with the VCA responsible for investigating, handling anti-competitive practices and promoting the law.

However, in Viet Nam, some sensitive sectors of the economy including electricity production and telecommunications are in need of involvement from the Government via sectoral regulatory agencies.

The agencies ensure fair competition between all firms in the sectors, anti-discrimination measures for new market entrants as well as establishing technical criteria for the sectors, in an effort to improve transparency.

Head of the Competition Policy Board Tran Phuong Lan said that the situation was caused by an overlap of regulations, power to handle violations and sanctions that were regulated in both the Competition Law and other sectoral laws.

Many legal documents referred to the unfair competition in communications, medicine and intellectual property rights, which imposed different fines for the same types of violations.

Do Xuan Minh, representative from the Telecommunication Department under the Information and Communications Ministry, said that since July 2010, all economic sectors could join the telecommunications market in Viet Nam, which had boosted competition in the sector.

Now, almost all service providers in the sector focused on competitive strategies based on discounts and promotional campaigns and the promotion for unfair competition was quite common, he said. As a sectoral regulator, Minh’s office took moves to control service charges, discounts, promotions, and service quality; and to inspect and handle violations.

However, the sectoral regulator faced being overloaded as almost firms had approached the regulator whenever they had problems.

Minh recommended that in the telecommunications sector alone, the regulator should be the first door that firms can knock on when they had competitive conflicts. Complicated cases could be dealt with by both Government’s Competition Authority and sectoral regulatory agencies.

The Swiss Competition Commission’s legal advisor Marc Schroeder said as a necessary investment for the future, Viet Nam needed to organise a powerful and independent competition authority, develop a healthy competitive culture, improve the law and boost co-operation at both national and international levels.

Through a three-year project starting in 2007, the Swiss Government had helped the Viet Nam Competition Authority improve its technical skills and knowledge.

Pham Que Anh, director of the Consumer Unity and Trust Society, Ha Noi Resource Centre, said that to promote a fair competitive environment, the sectoral regulators must be independent from business interests or Government influence. Besides regularly reviewing sectoral regulations, the responsibilities between a competition authority and the sectoral regulators also must be clear. — VNS

Tags: Vietnam business environment