WORLD TRADE
ORGANIZATIONWT/WGTCP/W/213
24 September 2002
(02-5130)
Working Group on the Interaction
between Trade and Competition PolicyOriginal:  English
COMMUNICATION FROM THAILAND
The following communication, dated 23 September 2002, has been received from the
Permanent Mission of Thailand with the request that it be circulated to Members.
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Core Principles
Doha Declaration
INTERACTION BETWEEN TRADE AND COMPETITION POLICY
25. In the period until the Fifth Session, further work in the Working Group on the Interaction
between Trade and Competition Policy will focus on the clarification of core principles, including
transparency, non-discrimination and procedural fairness, and provisions on hardcore cartels;
modalities for voluntary cooperation; and support for progressive reinforcement of competition
institutions in developing countries through capacity building.  Full account shall be taken of the
needs of developing and least-developed country participants and appropriate flexibility provided to
address them.
1. Core Principles
1.1 Thailand believes in the principles of non-discrimination, transparency and due process.  We
believe that the administration and enforcement of a competition law should be subject to these
principles in order to guarantee effective enforcement and fair treatment to all parties involved.  We
recognize that the lack of transparency, the absence of due process and discrimination in theadministration and enforcement of the law can seriously hamper the attainment of fair competition in
the market.  However, in compliance with the sp irit of the Doha Declaration, various needs and
constraints faced by developing countries will have to be taken into account.  We, therefore, propose
that "special and differential treatment" constitutes the fourth element of the core principles for
competition policy.
1.2 In addition, we are of the view that the approach taken to define these core principles thus far
is fundamentally flawed in that the focus has been  on the "domestic trade" rather than "cross border
trade".  This appears odd given that this working group's mandate is to examine the interaction
between trade and competition policy.  For example, non-discrimination has been usedinterchangeably with "national treatment", which refers to equal treatment between foreign and
domestic firms operating within a domestic market.  This is certainly a view that would serve the
interest of those with significant overseas investment that would like to ensure access to the hostWT/WGTCP/W/213
Page 2
countries' markets.  Most developing countries, however, are importers and exporters, rather than
investors.  Thus, we propose that priority of the core principles be given to tackling unfair practices in
cross border trade, rather than in domestic trade, that have not yet been dealt with in the WTO.
2. Non-discrimination
2.1 In Thailand's view on non-discrimina tion, a competition law should not discriminate between
export and non-export firms .  That is, if bid-rigging and pri ce or quantity-fixing agreements are
prohibited in the national competition law, export cartels should be subject to the same provisions.
We believe that the use of export cartels as a strategic trade policy to extract "rents" from foreign
countries is unacceptable.  A vast number or research reports show that most of these cartels are large
companies and that there is little or no efficiency justification for their collusive practices.   Export
cartels – be they national or international -- represent unfair trade practices that are potentiallydamaging to developing countries' economies in that they work against our terms of trade.   With
subsidies, developing countries earn less for their exports, while with cartels, they pay more for
imports.  Why is it that we have rules against selling goods at too low a price (dumping), but no rules
against excessive  pricing?  If the Doha Declaration is truly a development agenda, then unfair cross-
border trade, not unfair domestic trade, should be given priority.
2.2 The Thai Trade Competition Act B.E. 2542 (A.D. 1999) and its enforcement do not
discriminate  among firms based on their origin or nationality nor does it discriminate between
exporting firms and non-exporting firms.  No exemption is provided to export cartels nor international
cartels, such as shipping liners.
3. Transparency
3.1 We agree that  laws and regulations, exemptions, guidelines and competition authorities'
decisions or court deliberations should be disclosed.  We believe that transparency has a universal
merit and that Members should promote transparency in the administration and enforcement of the
competition law to the extent possible within the do mestic legal, institutional and social environment.
Thailand's Public Information Law 1997 guarantees access to public information and ourAdministrative Law 1996 guarantees transparent and fa ir administrative procedures.  Many cases have
been brought to the Public Information Committee and the Administrative Court during the last few
years.
3.2 We believe that each country should maintain the freedom to decide sectoral exemptions that
are consistent with its own national industrial policy.  However, we believe that international cartels
do not have a development justification and thus should not be included, and should be removed from,the list of sectoral anti-trust exemptions, in particular shipping conferences and similar rates
agreements.  The developing countries should be allowed to exempt export cartels for the purpose of
countering the bargaining strength of buyers/sellers' market power. Many studies confirm that the
existence of liner conferences have not contributed to greater efficiency in the global shipping liners
market, including the most recent one from the OE CD  (Competition Policy in Liner Shipping: Final
Report 2002).
3.3 The Thai Trade Competition Act provides bl ock exemptions to central, regional and local
administration, state owned enterprises, agricultural cooperatives, and other sectors or industries as
stipulated by the ministerial regulation.  Until to date, no other exemptions have been promulgated,except for those specified in the law.  Again, as mentioned before, Thailand does not provide an
exemption for any export or international cartels.WT/WGTCP/W/213
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4. Due Process
4.1 As for due process, we agree that rights to ap peal and to have private confidential information
protected are crucial.  However, each country should design its own appeal process and confidential
information protection schemes that are consistent with the local legal, political and institutional
environment.
4.2 In case of Thailand, the Prime Minister's Office's regulation concerning the protection of
confidential information provides a guideline on the classification and handling of confidential
information.  Our Trade Competition Act 1999 provides for an administrative appeal procedure.
According to the law, an Appeal Committee is to be established and staffed by members elected by
the Cabinet.  An appeal may be made within 30 days after a decision has been made.  The Appeal
Committee must deliberate within 90 days.  If the complainant is not satisfied with the appellatecommission's decision, he or she may bring the case to the administrative court.
5. Special and Differential Treatment
Finally, with respect to the fourth proposed core principle with regard to special and
differential treatment, we believe that developing countries should be allowed to:  (1) exempt nationaland international export cartels.  This is because most developing countries' exporters or importers are
mainly small scale and may need to bind together to counter the  bargaining power of larger buyers or
sellers from industrialized countries;  and (2) gradually introduce greater transparency and due
process in the administration and enforcement of competition law.
6. Conclusion
Thailand proposes that:  (a) the definition of non-discrimination be revised to include
discrimination between export and non-export undertakings; (b) current sectoral exemptions that
involve cross-border cartels be removed from national competition laws; (c) developing countries be
allowed to exempt export cartels for the purpose of countering the bargaining strength of
buyers/sellers' market power;  and (d) developing countries should be given a time frame to buildtransparency and due process in the administration and enforcement of the competition law.  On our
part, we will continue our work in promoting greater transparency and due process in the
administration of the competition law.
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