RESTRICTED
WORLD TRADE WT/WGTCP/W/19
3July1997
ORGANIZATION(97-2779)
Original: English Working Group ontheInteraction
between Trade andCompetition Policy
COMMUNICATION FROM ASEAN
1. ASEAN participates intheWorking Group onTrade andCompetition Policy inaccordance
withthemandate oftheSingapore Ministerial Declaration. According tothismandate, ourtaskis,
inpart,tostudy issues raised byMembers relating totheinteraction between trade andcompetition
policy, including anti-competitive practices. Theprocess isthusnecessarily educative and,assuch,
agradual one.
2. ASEAN alsowishes tostress thattheDeclaration provides thatthedevelopment dimension
istaken fullyintoaccount throughout ourconsideration oftheissues. Wewilllookatcompetition
policy -being thebroad topicthatitisandencompassing thegovernment regulation ofpublic andprivate
practices topromote competition -inthatlight.
3. Asawayofproceeding withourwork intheWorking Group, ASEAN initially proposes the
phased consideration ofthefollowing elements:
(a) thescope ofcompetition policy;
(b) theinteraction between competition policy andtrade policy;
(c) anti-competitive practices ofboththepublic andprivate sectors.
ASEAN reserves therighttosubmit further thoughts ontheseelements, ortopropose additional
elements, aswecarry outourwork intheWorking Group.
4. With respect tothescope ofcompetition policy:
(a) Considering thatWTO Members willnotengage intheWorking Group withacommon
understanding ofthetermcompetition policy, itwillbenecessary toidentify what
Members believe asthescope andobjectives ofcompetition policy asastarting point.
Thiswilllayoutthelandscape ofcompetition policy.
Itwillbeimportant toapproach thisexercise withanopenmind andwithout limiting
apriori thelandscape. Todootherwise would beadisservice totheeducative process
mandated intheDeclaration. TheWorking Group should thenbeabletocompile an
inventory onMembers 'views onthescope ofcompetition policy notasamatter of
national policy, butasamatter ofdefinition.
(b) Itwillbeinevitable thatintheprocess oflaying outthelandscape ofcompetition policy,
theWorking Group willalsoneedtotakestock ofthefollowing:
(i) existing competition-related provisions intheWTO Agreements andGATT
1994;WT/WGTCP/W/19
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(ii) aninventory anddiscussion ofwork inother inter-governmental bodies such
astheUNCTAD, including, forexample, the"SetofMultilaterally Agreed
Rules andPrinciples fortheControl ofRestrictive Business Practices";
(iii) existing competition lawsandpolicies inWTO Members, including those that
mayexistinbilateral andregional agreements.
Thiswillperhaps require asurvey across WTO Members, andvoluntary
presentations byWTO Members inaposition todoso.
Itwould alsobeimportant tolook atthestate-of-play with respect to
competition lawandpolicy, oritsabsence, indeveloping countries, and
determine thereasons forsuchsituation.
5. Theabove willconstitute anessential firstphase intheeducative process thatwillallow WTO
Members, whomaynotbeequals interms ofexperience incompetition lawandpolicy, toatleast
startonanequal footing inparticipating intheimportant taskahead oftheWorking Group.
6. TheWorking Group canthenproceed toexamine theinteraction between competition policy
andtradepolicy, withaviewtoidentifying notonlyareas where theymight beinconflict, butaswell
aswhere theyarecomplementary andsupportive ofeachother. Inthelatter case,theWorking Group
should lookatmeans toenhance suchcomplementarity. Thisphase willinvariably require thefollowing:
(a) anexamination oftheeffects ofcompetition policy ontrade, including theextra-
territorial application ofoneWTO Member ofitscompetition lawandpolicy andthe
influence thisexerts onthetrade performance, andtrade policy-setting, ofanother
WTO Member. Special emphasis should bedevoted tothesituation andexperience
ofdeveloping countries;
(b) anexamination oftheeffects oftrade policy (e.g. trade defence measures) on
competition, inparticular inthedomestic market ofaWTO Member implementing
suchtrade policy ormeasures. Again, particular emphasis should begiven tothe
situation andexperience ofdeveloping countries.
7. Work ontheissue ofanti-competitive practices ofboththeprivate andpublic sectors could
overlap withthesecond phase on"interaction". Butthefocus onthisthird phase willbeonanti-
competitive practices andnotoncompetition-creating lawandpolicy.
8. Anti-competitive practices, inASEAN 'sview, mayencompass actions which areorwhich
arenotnecessarily disciplined byexisting competition law,andwhich enhance thecompetitive position
ofcompanies attheexpense ofothers, andwhich undermine theveryessence ofcompetition, stifle
efficient resource allocation, andencumber economic growth. Thisphenomenon isalsoknown, in
anarrow sense, asrestrictive business practices. Particular emphasis should beplaced ontheimpact
ofanti-competitive practices ondeveloping countries.
9. TheSingapore Declaration alsomentions (inthesecond sub-paragraph ofparagraph 20)that
theWGshalldraw uponthework oftheWorking Group onTrade andInvestment ifnecessary. This
isanendeavour thattheWorking Group willneedtocarry outinthelonger-term future.
10. SincetheprocessintheWorkingGroupenvisionedabovemustbeeducativeandgradual,ASEAN
doesnotsuggest specific timetables forthecompletion ofwork ineachphase. Work ineachphase
should bepushed asfaraspossible before proceeding tothenextphase.WT/WGTCP/W/19
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11. Furthermore, theDeclaration provides thattheGeneral Council willkeepthework ofthis
Working Group under review, andwilldetermine aftertwoyears howthework oftheWorking Group
should proceed. Inthisregard, ASEAN wishes tostress thattheWorking Group doesnotneedto
report completion ofitswork totheGeneral Council intwoyears.
12. Members oftheWorking Group, especially thedeveloping country Members, cannot berushed
intoconclusions orcommitments. Anyideatherefore thattheWorking Group should eventually be
abletoconsider developing amultilateral framework oncompetition, orforMembers tocommit to
adopting competition laws, prejudges theoutcome ofthework oftheWorking Group.