Annex A
ASIFMA COMPETITION LAW GUIDANCEThis Guidance is a high-level summary of the application of the competition rules to theactivities of industry associations such as ASIFMA. It is not intended as a substitute for legal
advice on any specific issue.
Competition Law and Industry Associations
Competition law prohibits certain agreements, concerted practices and other forms of conduct,
including information exchanges, which may prevent, restrict or distort competition. It is important,both for companies and individuals, not to infringe the competition laws and regulations; doing somay result in the imposition of significant fines, reputational damage and, in some cases, penalties
for individuals.
In addition, where anticompetitive arrangements arise through contacts at industry associationor arise through the acts or decisions of industry associations, fines may be imposed by thecompetition authorities on the industry association itself, even though the association is unlikely
to be active on the affected markets.
Agreements or concerted action on price-fixing, production or supply fixing, allocations of sales,
territories, customers or markets, and bid-rigging generally constitute the most serious forms ofanticompetitive conduct. If either the object or effect of the agreement or conduct prevents,restricts or distorts competition, an infringement will likely be found.
Industry associations need to be alert to the anti-competitive potential of their activities because
anticompetitive agreements between competitors in a market may be concluded, implemented
and/or monitored through the medium of industry association contact.
The exchange of information, for example, may result in members becoming aware of elements ofpricing, quantities and/or market strategies of their competitors and using such information tofacilitate a cartel, adjust their own pricing, boycott common suppliers or customers or take otheraction with the effect of harming competition.
While the development and use of standard terms, another common activity of industry
associations, can generate pro-competitive benefits for industry members and/or their clientsor customers, any standard terms that define the scope and nature of product sold which may
limit product variety and innovation or relate to pricing could harm competition.
As a general rule, standard terms which do not affect price are unlikely to raise anti-competitive
concerns if the participation in the process of developing and adopting the terms is open, and thestandard terms are non-binding and accessible to all market participants. Exchanges of publicly
available information are also unlikely to constitute an infringement of the competition laws. Publicly
available information in this sense is information that is equally accessible in terms of the cost ofaccess to all competitors and customers.
Industry associations should also be careful about their membership admission as membershipcan be an essential pre-condition for competing in a market. To minimize possible competition
concerns, the rules of admission should be transparent, proportionate, non-discriminatory basedon objective standards and provide an appeal procedure for those who have been refused
membership.

Legitimate Activities of Industry Associations
Certain activities of industry or industry associations, such as ASIFMA, do not normally give rise
to competition law concerns. Information and activities which are not commercially sensitivein nature, and which as such are unlikely to give rise to competition concerns, may relate tomatters including:•The interpretation of existing or proposed legislation.

•Preparation of representations to governmental bodies on proposed legislation.

•Consideration of, and provision of guidance on, issues of a technical nature concerning theapplication of a law or regulation, provided such activities are not liable to affect thecompetitive behaviour of members or third parties.

However, care should be taken when undertaking such activities to ensure that there is noexchange of commercially sensitive information between members of the industry association.
Separately, exceptions or exemptions based on efficiency arguments may be available toundertakings including trade associations for certain conduct, although these are usually
narrowly interpreted by competition authorities and hence should be applied with caution.
Pursuant to the Hong Kong competition law, agreements that enhance overall economic
efficiency are excluded from the prohibition against anticompetitive agreements, provided
sufficient pro-competitive benefits can be shown. Similarly, agreements with "net economic
benefits" may also be excluded from the prohibition against anticompetitive agreements
pursuant to the Singapore competition law.
Commercially Sensitive Information
Commercially sensitive information typically relates to matters such as:•

prices and other terms of business, including discount and rebate structures;•customers and a firm’s engagement with its customers;•costs;•volume or value of sales;•business strategy such as marketing plans, risks and investment; and•bidding intentions.

Potentially Anticompetitive Conduct involving Industry Associations
Activities of industry associations which may give rise to a risk of infringing competition law
include:•Discussions at meetings or in online forums hosted by an industry association which may
prompt member firms to consider modifying their terms of business or practices withregard to commercially sensitive matters.

•

Adoption of non-binding decisions or recommendations which may in practice lead
members to align their competitive conduct on the market.

•Adopting best practices and standard-setting measures which may lead members to aligntheir competitive conduct on the market or ‘shut out’ competitors who do not have accessto, for example, a shared technical standard.

•Imposing rules, regulations and/or membership criteria which may have an impact on theability of operators to compete freely on the market.

Practical Guidance• Information regarding members that is of a commercially sensitive nature should bemaintained separately from information which is not commercially sensitive, to ensurethat the former is not inadvertently distributed by ASIFMA among its members in thecourse of other, legitimate business.
•Meetings should follow a written agenda, prepared in advance, and a written record oftopics discussed at meetings should be produced. Chairs of an ASIFMA formal meetingshould remind meeting participants about competition law compliance in the beginning of
the meeting.

•Online facilities permitting bilateral or multilateral communication between members
should include an appropriate warning regarding the need to avoid any exchange ofcommercially sensitive information, and should be periodically monitored for evidence ofpotentially collusive discussions.

•If there is any doubt regarding whether initially legitimate discussions may be straying, orrisk straying, into a commercially sensitive area, such discussions should be terminatedand advice sought before continuing with them. The assessment of whether or notdiscussions regarding a particular topic may continue is likely to depend on the surrounding
facts.

•Membership criteria (for membership of both ASIFMA itself and of its committees) shouldbe transparent, proportionate, non-discriminatory, based on objective standards andsubject to appeal in the event of a refusal to admit a party to membership. Proposed
expulsion or termination of membership must be supported by reasons, objectively
justified and subject to an effective right of appeal.

•Best practices and/or common standards may be procompetitive where they areobjectively justified, for example by reference to benefits to end-users. However, sucharrangements may infringe competition law where they have the effect of preventing firms
from selling products which fail to meet a certain standard, limit technical development orimpede imports.

•When conducting industry surveys, information circulated to members should behistorical, anonymised and aggregated. Data should not enable recipients to discerncommercially sensitive information regarding their competitors’ conduct on the market.

••Studies commissioned by ASIFMA and consultation responses provided by it regarding, forexample, proposed legislative changes should not be used as a means of influencing ordisclosing sensitive aspects of members’ conduct on the market.

Document retention is not required by competition law, but destroying, falsifying or altering
documents once an investigation or litigation is underway or in contemplation may be anobstruction of justice and constitute a criminal offence. It is advisable to adopt a consistentpolicy to document retention, having regard to the fact that destruction of documents may
make it difficult to apply to one or more competition authorities for immunity or leniency in thefuture, and that documentary evidence may be exculpatory.
March 2022