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FIFTEENTH (15TH) CONGRESS 
REPUBLIC OF THE PHILIPPINES 
Second Regular Session 
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I' (tIUn!' tl! tI': ~ ~'r\lI':'.H~ 
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SENATE 
S.B. No. 3109 
Introduced by Senator Teofisto "TG" Guingona III 
EXPLANATORY NOTE 
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Bound by a clear Constitutional mandate, "the State shall regulate or 
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prohibit monopolies when the public interest so requires. No combinations in 
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restraint of trade or unfair competition shall be allowed (Article 12, Section 19 of 
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the Constitution)". 
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However, historical records reveal that through the years, different firms 
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have committed prejudicial acts of market manipulation especially in times of 
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calamities and national shortages. As a result, the consumers suffer while the 
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competitive position of small and medium enterprises continues to be eroded. 
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Fair competition is the best guarantee that consumers, be they individuals 
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or corporations, will be in a position to obtain the best products and services for 
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their money. It likewise ensures that producers and service-providers will provide 
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the best goods and services at the best prices, and that they would do so solely 
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through astute deciSions, business acumen and innovation -
thus allowing other 
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firms to enter into and compete fairly in the market. 
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In order to acquire more market shares, exploit economies of scale, obtain 
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additional business know-how, businesses may acquire other business firms -
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sometimes even rival firms. However, such right has limits. 
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It is clear then that the Philippines has in fact a clear competition policy, 
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albeit with different enabling laws, and without a single government entity 
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concerned only with competition policy. 
It is widely believed then that our 
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competition policy will be best implemented if we enact and strictly enforce a 
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comprehensive competition law. 
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Among others, this bill seeks to define and enumerate prohibited acts that 
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restrict, prevent, limit, and/or distort competition. It likewise seeks to establish a 
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Philippine Fair Competition Commission, an independent agency with the original 
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and exclusive jurisdiction to implement the national competition policy and to 
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attain the objectives and purposes of this proposed measure. It likewise seeks to 
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provide strict penalties for anti-competitive acts and/or omissions. 
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The passage of this measure is sincerely sought. 
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o "TGif GUINGONA III 
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1 
FIFTEENTH (15TH) CONGRESS 
2 
REPUBLIC OF THE PHILIPPINES 
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Second Regular Session 
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SENATE 
S.B. No. 3109 
'1 ,".", 
JAN 26 
,', c: :,~ 0 
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Introduced by Senator Teofisto "TG" Guingona III 
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AN 
ACT 
TO 
IMPLEMENT 
THE 
COMPETITION 
POLICY 
UNDER 
THE 
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CONSTITUTION, 
STRENGHTEN 
THE 
PROHIBmON 
AGAINST 
ABUSE 
OF 
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MONOPOLY 
POWER 
OR 
DOMINANT 
POSmON, 
PREVENT 
CARTELS, 
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COMBINATIONS IN RESTRAINT OF TRADE AND OTHER ANTICOMPETITIVE 
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PRACTICES AND CONDUCT, AND FOR OTHER PURPOSES. 
W 
I 
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Be it enacted by the Senate and the House of Representatives of the Philippines 
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in Congress assembled: 
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CHAPTER I 
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GENERAL PROVISIONS 
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SECITON 1. Title. - This Act shall be known and cited as the "Competition Policy 
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Act of 2011." 
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SEC. 2. Declaration of Policy. - Pursuant to the constitutional mandate that 
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the State shall regulate or prohibit monopolies when the public interest so 
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requires and that no combinations in restraint of trade or unfair competition shall 
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be allowed, the State shall: 
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(a) regulate business conduct with the objective of fomenting a business 
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climate conducive to productivity and sustainability, where businesses 
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compete in a level playing field, using only innovation, business 
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acumen, astute marketing, diligence, and ability to raise capital 
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through legitimate means, and in general offering quality goods and 
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services that reflect the best value for customers. 
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(b) safeguard the welfare of consumers, especially the more vulnerable 
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sectors of the economy, most especially in times of calamities, natural 
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disasters, and other disturbances affecting the daily routine and 
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bUSiness of persons in the Philippines; 
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(C) penalize all forms of unfair trade, anti-competitive conduct and 
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combinations in restraint of trade, with the objective of protecting 
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consumer welfare and advancing domestic and international trade and 
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economic development.! 
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(d) promote and enhance productivity, innovation, economic efficiency, 
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and free, full and fair competition in trade, industry and all commercial 
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economic activities; 
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(e) prevent or reverse the concentration of economic power in a single or 
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a few persons or related persons in order to preclude a situation where 
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they - to the detriment of competitors or new entrants to the market, 
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suppliers, and the consumers -
threaten to control the production, 
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purchase, trade, provision of goods and services, in order to stifle 
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competition, distort, manipulate or constrict the disCipline of free 
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markets, or increase market prices in the Philippines. 
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SEC. 3. Scope and Application- This Act shall be enforceable within the 
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territory of the Republic of the Philippines and shall apply to all areas of trade, 
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industry and commercial economic activity. 
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The Act shall apply to: (a) all firms as defined hereunder and all their 
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commercial agreements, actions or transactions involving goods, services or 
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intellectual property; and, (b) all agents, officers, employees, partners, owners, 
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directors, consultants, stockholders, representatives, managers, supervisors, and 
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all other natural persons who, acting on behalf of juridical persons shall 
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authorize, engage or aid in the commission of restrictive practices prohibited 
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under this Act. 
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The absence of an employer-employee relationship under labor relations 
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laws and case law shall not be a defense for any violation of this Act. 
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It shall likewise be applicable to international trade having direct, 
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substantial and reasonably foreseeable effects in trade, industry or commerce in 
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the Republic of the Philippines including those that result from acts done outside 
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the Republic of the Philippines and to acts committed by foreign multinational 
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corporations or foreign entities operating in the Philippines, whether or not 
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organized under Philippine laws, including their subsidiaries, branches, agents, 
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regional offices, and other related entities such as joint ventures. 
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In order to allow affected parties time to renegotiate agreements or 
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restructure their business to comply with the new competition law the penal 
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provisions of this Act shall be imposed one (1) year after its effectivity. During 
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the said one (1) year period, the Philippine Fair Competition Commission shall 
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undertake an advocacy program of the provisions of this Act to the stakeholders 
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and the general public. 
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SEC. 4. Definition of Terms. - As used in this Act, the following terms shall be 
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defined as: 
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(a) "Agreements" shall refer to any type or form of contract, arrangement, 
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understanding, 
undertaking, 
concerted 
action, 
collective 
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recommendation, parallel action, whether formal or informal, written or 
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oral; 
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(b) "Cartel" shall mean a combination of firms or persons, providing goods 
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and/or services in relevant markets, acting or joined together to obtain 
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a shared monopoly or ability to control production, purchase, sale and 
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price, or to obtain control in any particular industry or commodity, or a 
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group of firms that agree to restrict trade. It shall also refer to firms or 
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section of firms having common interest designed to promote the 
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exchange of knowledge resulting from scientific and technical research, 
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exchange of patent rights and standardization of products among 
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themselves with the intent of preventing, restricting or distorting 
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competition; 
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(c) "Commission" shall mean the Philippine Fair Competition Commission 
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created under this Act. 
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(d) "Competition" shall mean both the economic condition and the process 
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by which economic agents, acting independently in a market, engage! 
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in commerce through fair means, offering quality goods and services 
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for value, using solely business acumen, legitimate means of raising 
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capital, innovation, hard work, astute marketing, and rational industrial 
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organization. It also includes a process and a 
situation where 
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economic agents limit each other's ability to control the prevailing 
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conditions in the market, offer their goods and services to consumers 
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without limiting the ability of their competitors to market their goods or 
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provide services, or without preventing new entrants to the market. 
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Finally, it likewise includes a business climate where a firm or 
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combination of related or unrelated firms do not impose their will on 
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their suppliers to the detriment of the latter, the competitors of the 
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former, and the consumers. 
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(e) "Control" shall refer to at least fifty-one percent (51%) ownership, 
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directly or indirectly, of a firm or a group of firms by another firm; 
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(f) "Dominant Position" shall refer to a situation where a firm, either by 
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itself or acting with other firms, is in a position to control a relevant 
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market for the sale of a particular good or service by fixing its prices, 
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excluding competitor firm, or controlling the market in a specific 
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geographical area. It shall also mean a situation where under the pain 
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of boycotting or refusing to sell their supplier'S products, the retailers, 
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wholesalers, distributors, with dominant position can force suppliers 
and manufacturers to provide discounts not granted to competitors. 
Finally, it shall also include a situation were the sellers are able to give 
preferential treatment to their own "generic" brands, to the detriment 
of manufacturers and distributors of other goods also sold by these 
sellers. 
a. -"Firms" shall include any person, natural or juridical, partnership, 
combination or association in any form, whether incorporated or 
not, domestic or foreign, including those owned or controlled by the 
government, engaged directly or indirectly in any economic activity: 
Provided, That, two firms, one of which is controlled by the other, 
shall be treated as one firm: Providect further, That two or more 
firms that are controlled by a single firm, or controlled by a 
common parent corporation or controlled by related entities, shall 
be treated as a single firm; 
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(g) "Goods" and "Services": "Goods" include all types of tangible and 
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intangible property that could be bought and sold, and the possession 
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and/or ownership of which could be transferred in whole or in part, 
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temporarily or permanently; 
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"Services" shall refer to the provision of things of value or articles or 
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items that could be used by one person, whether natural or juridical, to 
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another through human interaction or through the use, without 
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transfer of ownership, of the facilities of the provider by the Client, or a 
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combination of both. It shall include all non-tangible goods. It is the 
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non-material equivalent of a good, consumed at the point of sale and 
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does not result in ownership; 
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(h) "Market" shall refer to a place or venue for commercial activity, which 
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may be a barangay, city, province, region, the whole area of the 
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Philippines, or which may extend beyond the borders of the Republic of 
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the Philippines, where articles are bought or sold. It shall also refer to 
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the geographical or economic extent of commercial demand; 
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(i) "Mergers" and "Consolidations" refer to transactions or contracts where 
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two or more undertakings, previously independent of one another, join 
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together, regardless of the form by which such transactions or 
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contracts are structured. These would include: 
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1. two (2) or more corporations or firms merge into a single firm 
which shall be one of the constituent firms; 
2. two or more firms consolidate into a new single firm which shall be 
the consolidatekd firm, I' 
1ft 
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h hi' 
3. one firm ta es so e contro 0, acquires, or a es over t e woe or 
part of another; 
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4. one firm or related firms take control of all or substantially all of the 
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assets of the another firm; 
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5. one firm or related firms take control of the majority shares of 
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stock, either by vote or value, or other share capital of another entity; 
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6. two or more firms acquire joint control over another firm (joint 
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ventures); and 
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7. other transactions, whereby one or more firms acquire control over 
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one or more firms, such as through interlocking directorates. 
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II 
(j) "Monopoly" shall mean a privilege or undue advantage of one or more 
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firms, consisting in the exclusive right to carry on a particular business 
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or trade, and/or manufacture a particular product, article or object of 
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trade, commerce or industry. It is a form of market structure in which 
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one or only a few firms dominate the total sales of a product or 
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service; 
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(k) A "monopsony" exists in a market that has only a single buyer or a 
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cartel of buyers. 
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(I) "Relevant Market" shall refer to the line of commerce that must be 
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delineated in order to determine whether competition has been 
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restrained or could potentially be restrained. It shall also refer to the 
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geographic area involved, including all reasonably substitutable goods, 
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and all competitors, from which consumers could purchase should the 
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goods or services in question. The relevant market combines the 
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product market and the geographiC market, defined as follows: 
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i. a relevant product market comprises all those products 
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and/or services which are regarded as interchangeable or 
substitutable by the consumer by reason of the products' 
characteristics, their prices and their intended use; and 
ii. a relevant geographic market comprises the area in which 
the firms concerned are involved in the supply of products or 
services and in which the conditions of competition are 
sufficiently homogeneous. 
CHAPTER II 
PROHIBITED ACTS 
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SEC. 5. Collusive Conducts and Anti-competitive Agreements. -
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Unless otherwise exempted, related or unrelated firms are prohibited from 
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entering into any form of horizontal or vertical agreement, contract, 
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understanding, common or collective recommendation, nor shall they engage in 
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concerted or parallel actions directed at suppressing, undermining, distorting or 
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restricting competition. 
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a] "Horizontal agreement" means an agreement entered into between two 
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or more enterprises operating at the same level in the market; 
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b] "Vertical agreement" means an agreement entered into between two or 
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more enterprises, each of which operates, for the purposes of the 
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agreement, at a different level of the production or distribution chain, and 
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relating to the conditions under which the parties may purchase, sell or 
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resell certain goods or services; 
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Such collusive conducts or anti-competitive agreements shall include the 
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following: 
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(a) Price-Fixing- Any agreement among competitors, directly or indirectly, 
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to raise, suppress, fix or otherwise maintain the price and other terms 
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and conditions at which their goods and services are sold such as, but 
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not limited to, establishing or adhering to price discounts, holding 
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prices firmly, eliminating or reducing discounts, adopting a standard or 
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formula for computing prices, maintaining certain price differentials 
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between different types, sizes or quantities of products, adhering to a 
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minimum fee or schedule and other analogous schemes with the 
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purpose and effect of creating a monopoly or cartel or lessening 
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competition. 
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(b) Bid Rigging - Any agreement among bidders or between the bidders 
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and the auctioneer to fix price at auctions or in any other form of 
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bidding, with the purpose and effect of creating a monopoly or cartel, 
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or lessening competition such as, but not limited, to cover bidding, bid 
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suppression, bid rotation and market allocation and other analogous 
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practices of bid manipulation. In determining whether there is price 
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fixing or bid rigging, the following circumstances may be considered: 
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(1) generally, any conSidered evidence that two sellers of similar 
goods have agreed to set the price of their goods, to sell only a 
certain amount of their goods, or to sell only to a limited 
number of buyers or consumers; 
(2) a drastic change in prices of goods and services involving 
more than one seller of similar goods of different brands, 
particularly if the changes in prices take place in equal amount 
and about the same time; 
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(3) a seller refusing to sell based on an agreement with a 
competitor; 
(4) the same firm has repeatedly been the low bidder who has 
been awarded contracts for a certain service or a particular 
bidder seems to win bids on a fixed-rotation; 
(5) there is an unusual and unexplainable difference between 
the winning bid and all other bids; and 
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(6) the same bidder bids substantially higher on some bids than 
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on others, and there is no logical cost reason to explain the 
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difference. 
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(c) the limitation or control of the production or distribution, or the 
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technical development, or of the investments. 
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(d) assignment of markets or the assignment of sources of supplies; 
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(e) unequal treatment in the sale or purchase of goods or provision of 
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services that puts one or more competitors at a disadvantage. 
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(f) Monopsony.- A arrangement or a practice where a cartel or a group of 
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firms forces sellers, producers, service providers to accept payment 
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below market price, whether in the form of cash, credit or any other 
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conSideration, in exchange for their goods and services. This shall also 
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include an arrangement where the cartel or its related entities will 
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provide credit to the sellers, producers, and service providers only if 
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they agree to sell at below market price and/or sell all of their products 
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and render all of their services to the creditor or the cartel, or any 
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member thereof, or to any person designated by the creditor, cartel, or 
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any member ofthe latter. 
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(g) The subordination of the perfection of contracts to buy or sell goods or 
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services to the acceptance by the buyers or sellers of supplementary 
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obligations which, by their nature or pursuant to commercial usage, 
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have no connection with the subject matter of the contract. 
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There shall be a prima facie case for the existence of an anti-competitive 
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agreement or collusive conduct if and when the Commission finds that two or 
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more firms that are ostensibly competing for the same relevant market actually 
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perform uniform or complementary acts among themselves which tend to bring 
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about artificial and unreasonable increase, decrease or fixing in the price of any 
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goods or when they simultaneously and unreasonably increase, decrease or fix 
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the prices of their seemingly competing goods thereby lessening competition in 
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the relevant market among themselves. 
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SEC. 6. Abuse of Dominant Position. - It shall be unlawful for a firm, acting 
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alone, or in concert with one or more firms to abuse their dominant position by 
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engaging in unfair methods of competition, or in unfair or deceptive trade 
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practices, or entering into combinations in the form of trust or otherwise, or 
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conspiracy, for the purpose of preventing, restricting, or distorting competition. 
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Abusive conduct or agreements such as, but not limited to, any of the following, 
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shall be deemed to fall under the crime of abuse of dominant position: 
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(a) Predatory Behavior Towards Competitors - Any agreement or conduct, 
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including, but not limited to, selling goods or rendering services at below 
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relevant cost with the intent of driving competitors out of the market, or 
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creating barriers to entry; 
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(b) Monopsony.-
A arrangement or a practice sellers, producers, service 
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providers are compelled to accept payment below market price, whether 
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in the form of cash, credit or any other consideration, in exchange for 
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their goods and services. This shall also include an arrangement where the 
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firm with dominant position or its related entities will provide credit to the 
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sellers, producers, and service providers only if they agree to sell at below 
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market price and/or sell all of their products and render all of their 
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services to the firm in possession of dominant position, the creditor, or to 
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any person deSignated by them. 
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(c) Limitation and Control of Markets - Any agreement to limit or control 
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production, markets, technical development, or investment with the 
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purpose and effect of creating a monopoly or cartel, or lessening 
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competition; 
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(d) Market Allocation -
Any agreement to divide the market, whether by 
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volume of sales or purchase or by territory, by type of goods sold, by 
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customers or sellers or by any other means, with the purpose and effect of 
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creating a monopoly or cartel, or lessening competition; 
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(e) Arrangements to Share Markets or Sources of Supply- Any agreement to 
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share markets or sources of supply of raw materials, with the purpose and 
39 
effect of creating a monopoly or cartel, or lessening competition; 
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(f) Price Discrimination - Any agreement prescribing or charging, directly or 
42 
indirectly, discriminatory pricing terms or conditions in the supply or 
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purchase of goods of like grade and quality with the purpose and effect of 
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creating a monopoly or cartel, or substantially lessening competition: 
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Provide4 That nothing contained herein shall be construed to prohibit 
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permissible price differentials unless the same shall have the effect of 
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preventing, restricting or distorting competition: Provide4 further, That for 
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the purpose of this section, the following shall be considered permissible 
price differentials: 
(1) Socialized Pricing - Socialized pricing for the less fortunate sectors 
of the economy; 
(2) Volume Discounts - Price differentials which reflect an allowance 
for differences in the cost of manufacture, sale, or delivery resulting 
from differing methods or quantities in which the goods are sold or 
delivered to the purchasers; 
(3) Competitive Pricing - A price differential or other terms of sale in 
response to the competitive price of payments, services or facilities 
furnished by a competitor; 
(4) Bonafide Selection of Customers - The selection of customers on 
bona fide transaction; and 
(5) Price 
Differentials 
Due 
to Changing 
Market Conditions 
or 
Marketability of Goods -
Price changes from time to time in 
response to changing conditions affecting the market or the 
marketability of the goods concerned such as, but not limited to, 
actual or imminent deterioration of perishable goods, obsolescence 
of seasonal goods, distress sales under court process, or sale on 
good faith in discontinuance of business. 
(6) Price differentials providing for lower prices for cash payments. 
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(g) Exclusivity Arrangement - Any agreement imposing restrictions on the 
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lease or contract for sale or trade of goods concerning where, to whom, or 
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in what forms goods may be sold or traded, such as, but not limited to, 
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fixing prices, or giving preferential discounts, or rebate upon such price, or 
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imposing conditions not to deal with competing firms, where the purpose 
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of such agreement is to lessen competition: 
Provid~ That nothing 
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contained herein shall prohibit or render unlawful permissible franchising, 
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licensing or exclUSive distributorship agreements; 
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(h) Tie-In Arrangements - Any agreement making the supply of particular 
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goods dependent upon the purchase or lease of other goods from the 
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supplier or his consignee, where the purpose and effect of such sale or 
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lease or such condition is to substantially lessen competition or to create a 
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monopoly or cartel; 
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(i) The subordination of the perfection of contracts to buy or sell goods or 
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services to the acceptance by the buyers or sellers of supplementary 
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obligations which, by their nature or pursuant to commercial usage, are 
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not integral to the goods or services being purchased. 
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(j) Unequal treatment in the sale or purchase of goods or provIsion of 
5 
services that puts one of more competitors at a disadvantage. 
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7 
(k)Unjustified refusal to sell goods or provide services. 
8 
9 
(I) Boycott - Any concerted refusal to sell or conspiracy not to sell or to stop 
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doing business on the part of the suppliers of any goods, unless for a 
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legitimate purpose. 
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The acts described under this Section shall remain prohibited regardless of 
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the manner by which dominant position was obtained. 
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SEC. 7. Anti-competitive Mergers and Consolidations- No person or firm 
17 
shall be a party to any merger or consolidation and no firm engaged in 
18 
commerce or trade shall acquire, directly or indirectly, any part of the stock or 
19 
other share capital, or any part of the assets, of one or more firms engaged in 
20 
any line of commerce or trade where the effect of such merger or consolidation 
21 
or acquisition of such stocks, share capital, or assets, or of the use of such stock 
22 
by voting or granting of proxies or otherwise maybe to substantially lessen 
23 
competition, or tend to create a monopoly. 
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(a) Permissible Stock or Asset Acquisition or Ownership. - Nothing 
26 
contained herein, however, shall be construed to prohibit a 
27 
corporation from causing the formation of subsidiary corporations, or 
28 
from owning and holding all or part of the stock of such subsidiary 
29 
corporations, for the actual carrying on of their immediate lawful 
30 
business, or the natural and legitimate branches or extensions 
31 
thereof. 
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(b) Notification Prior to Stock or Asset Acquisition. - No firm shall acquire, 
34 
directly or indirectly, the shares of stock or assets of any other firm, if 
35 
as a result of the acquisition, the acquiring firm would own twenty 
36 
percent (20%) or more of the shares of stock, other share capital, or 
37 
assets of the a9quired firm, unless, the acquiring and selling firm 
38 
notify, prior to the conclusion of the agreement for such acquisition 
39 
and in the prescribed form, the Commission of such proposed 
40 
acquisition. Only the acquiring firm is required to make the notification 
41 
in a tender offer. The contemplated acquisition shall be deemed 
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approved, unless the Commission, within thirty (30) calendar days 
43 
from receipt of the notification, orders the acquiring firm to show cause 
44 
why the proposed acquisition shall not be declared as prohibited under 
45 
this Act. The show cause order shall set forth the facts upon which it 
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is based. The acquiring or selling firm may contest the show cause 
47 
order, in which case, the proposed acquisition shall be considered 
48 
enjoined until the Commission shall have rendered a decision on the 
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proposed acquisition after due notice and hearing, in accordance with 
2 
the procedure prescribed herein for the disposition of a show cause 
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order. 
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(c) Transactions Exempt from Prior Notice Requirement - The following 
6 
classes of transactions are exempt from the prior notice requirement 
7 
under this Section: 
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(1) Acquisition of goods or realty transferred in the ordinary course 
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of business; 
11 
(2) Acquisitions of bonds, mortgages, deeds of trust, or other 
12 
obligations which are not voting securities; 
13 
(3) Acquisitions of voting securities of an issuer at least fifty 
14 
percent (50%) of the voting securities of which are owned by 
15 
the acquiring firm prior to such acquisition; 
16 
(4) Transfers 
to, 
or 
from, 
government 
agencies 
or 
17 
instrumentalities, including government-owned or controlled 
18 
corporations; 
19 
(5) Transactions exempted from the provisions of this Act and 
20 
other proper and applicable laws; 
21 
(6) Acquisitions, solely for the purpose of investment, of voting 
22 
securities, if as a result of such acquisition the securities 
23 
acquired or held do not exceed ten percent (10%) of the 
24 
outstanding voting securities of the issuer; 
25 
(7) Acquisitions of voting securities pursuant to the preemptive 
26 
rights of the acquiring firm; or, if, as a result of such 
27 
acquisition, the voting securities acquired do not increase, 
28 
directly or indirectly, the acquiring firm's per centum share of 
29 
outstanding voting securities of the issuers; or 
30 
(8) Such other acquisitions, transfers, or transactions which the 
31 
Commission may declare as are not likely to violate the 
32 
provisions of this Act or any other proper and applicable law. 
33 
34 
35 
36 
37 
CHAPTER III 
PHILIPPINE FAIR COMPETITION COMMISSION 
38 
SEC. 8. 
Philippine Fair Competition Commission. - To implement the 
39 
national policy and attain the objectives and purposes of this Act, an independent 
40 
Commission is hereby created, which shall be known as the Philippine Fair 
41 
Competition Commission (PFCC), hereinafter referred to as the Commission, and 
42 
which shall be organized within sixty (60) days after the approval of this Act. To 
43 
ensure that the Commission is organized within the mandated period and to 
44 
ensure that the provisions of the law are followed with regard to its structure, a 
45 
Task Force to be composed of members from the Office of the PreSident, The! 
46 
Civil Service Commission, Tariff Commission, Department of Trade and Industry, 
47 
Department of Justice, and the Department of Budget and Management shall be 
' 
48 
created. 
Page 13 of 31 


1 
2 
For budgetary purposes, the Commission shall be under the Office of the 
3 
President. 
4 
5 
(a) Composition. - The CommisSion shall be composed of a Chairman and 
6 
four (4) Associate Commissioners. The Commissioners shall be citizens 
7 
and residents of the Philippines, at least forty (40) but not more than 
8 
sixty-five (65) years of age, of good moral character and of recognized 
9 
probity and independence. The Chairman and two (2) of the Associate 
10 
CommisSioners shall be members of the Philippine Bar and the 
11 
remaining two (2) shall be of recognized competence in the field of 
12 
economics preferably in industrial organization economics, or finance, 
!3 
commerce, accounting or management. They must have been in the 
14 
active practice of their professions for at least ten (10) years, but must 
15 
not have been candidates for any elective national or local office in the 
16 
immediately preceding elections, whether regular or special. 
17 
18 
(b) 
Term of Office. - The Chairman and the Associate Commissioners 
19 
shall be appointed by the President of the Philippines. The term of 
20 
office of the Chairman and the Associate Commissioners shall be six 
21 
(6) years without reappointment. The Chairman shall hold office for six 
22 
years and of the first four (4) Associate CommisSioners, two (2) shall 
23 
hold office for a term of four (4) years and two (2) for a term of two 
24 
(2) years. In case a vacancy occurs before the expiration of the term 
25 
of office, the appointment to such vacancy shall be only for the 
26 
unexpired term of the predecessor; 
27 
28 
(c) Prohibition and Disqualifications. - The Commissioners shall not, during 
29 
their tenure, hold any other office of employment. They shall not, 
,! 
30 
during their tenure, directly or indirectly practice any profession, 
3 I 
participate in any business, or be financially interested in any contract 
32 
with, or any franchise, or special privileges granted by the government 
33 
or any subdivision, agency, or instrumentality thereof, including 
34 
government-owned and controlled corporations of their subsidiaries. 
35 
They shall strictly avoid conflict of interest in the conduct of their 
36 
office, they shall not be qualified to run for any office in the election 
37 
immediately succeeding their cessation from office. They shall not be 
38 
allowed to appear or practice before the Commission for two (2) years 
39 
following their cessation from office. 
40 
41 
42 
43 
44 
45 
46 
47 
48 
No spouse or relative by consanguinity or affinity within the fourth 
civil degree and no former law, business, or professional partner or 
associate of any of the Commissioners, the Chairman and the Secretary 
of the Commission may appear as counselor agent on any matter 
pending before the Commission or transact business directly or 
indirectly therein during his/her incumbency and within one (1) year 
from his/her cessation of office. 
Page 14 of 31 


I 
(e) Compensation of Commissioners. - The Chairman of the Commission 
2 
shall hold the rank of and shall have the privileges and compensation 
3 
equivalent to that of a Department Secretary or Presiding Justice of the 
4 
Court of Appeals, 
whichever 
is 
higher, 
while the Associate 
5 
Commissioners shall each hold the rank of and shall have the privileges 
6 
and compensation equivalent to that of a Department Undersecretary 
7 
or Associate Justice of the Court of Appeals, whichever is higher. 
8 
9 
10 
II 
12 
13 
(f) 
Quorum. - Three (3) members of the Commission shall constitute a 
quorum and the affirmative vote of three members (3) shall be 
necessary for the adoption of any rule, ruling, order, resolution, 
decision or other acts of the Commission en bane 
14 
(g) Principal Office, Branch and Venue. - The Commission shall hold its 
15 
principal office in Metro Manila but it may, conduct hearings outSide of 
16 
Metro Manila upon prior notice for inquiries, studies or any other 
17 
proceedings required for the proper and efficient exercise of its power 
18 
and the discharge of its duties. It may establish branch offices outside 
19 
of Metro Manila as may be necessary for the effective discharge of its 
20 
functions. 
21 
22 
(h) 
Staff. -
The Commission shall appoint, fix the compensation in 
23 
accordance with the Revised Compensation and Position Classification 
24 
law, determine the status, qualifications, and duties of an adequate 
25 
staff, which shall include an Executive Director of the Commission. The 
26 
Executive Director shall be appOinted by the President and shall have 
27 
relevant experience in any of the fields of law, economics, commerce, 
28 
management or finance for at least ten (10) years. Provided, that, he 
29 
shall be a Career Executive Service Officer (CESO). The members of 
30 
the technical staff, except those performing purely clerical functions 
31 
shall possess at least a Bachelor Degree in the following fines of 
32 
speCialization: 
economics, preferably in industrial organization; law; 
33 
finance; commerce; accounting; or management. 
34 
35 
SEC. 9. Original and Exclusive Jurisdiction. - The Commission shall have 
36 
original and exclusive jurisdiction to enforce, implement and administer the 
37 
provisions of this Act, its implementing rules and regulations, and all other 
38 
competition laws, and in particular: 
39 
40 
(a) 
Powers of the Commission Upon Prior Notice and Hearing. - The 
41 
Commission may exercise the following powers, only upon prior notice 
42 
and hearing: 
43 
44 
(1) Binding Rules- To issue binding rulings; 
45 
46 
47 
(2) Show Cause Order and Decision - To issue show cause orders, and 
thereafter, render decision thereon; 
Page 1S of 31 
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(3) Consent Judgment -
To approve, or disapprove, proposals for 
consent judgment; 
(4) Preliminary Inquiry- To conduct the required preliminary inquiry of 
cases involving violations of this Act and other competition laws; 
and thereafter, if appropriate, to sign and file the proper criminal 
complaint before the Department of Justice; 
(5) Administrative Fines and Penalties - To impose the appropriate 
administrative fines or penalties herein authorized to be imposed; 
.! 
(6) Issuance of Injunctions, Restraining Order, and Cease and Desist 
Orders. - To issue a writ of mandatory injunction, to enjoin or 
restrain, temporarily or permanently, any actual or threatened 
commission of any or all prohibited or unlawful acts or to require 
the performance of a particular act which, if not restrained or 
performed forthwith, may cause grave or irreparable damage to 
competitors, consumers, or suppliers, or render ineffectual any 
decision in favor of a party to a competition dispute. 
(7) Delegation of Power Which Require Notice and Hearing. -
The 
Commission sitting en banc may delegate, on a case to case basiS, 
its power to hear and deCide any case or matter which require prior 
notice and hearing, to a division of one (1) Commissioner. 
The 
resolution of the Commission sitting en banc making such a 
delegation shall be made part of the records of the case or matter 
and the aSSignment of a case of matter to a particular division shall 
be made by means of a raffle conducted in public; and 
(8) Appeal to the Commission En Bane -
Final orders, resolutions, 
judgments, or deCisions of a division may be appealed to the 
Commission sitting en bane, by any party adversely affected 
thereby, within a period of fifteen (15) days from receipt of such 
.! 
order, resolution, judgment, or deciSion on all issues of fact and 
law. 
The Commissioner whose order, resolution, judgment, or 
decision is the subject of the appeal is disqualified from 
participating, nor shall he be present, in the deliberations and 
decision of the Commission en banco In case of a tie, the appealed 
order, resolution, judgment, or decision is deemed affirmed. The 
Commission, on its own, or upon motion of a party who has actively 
participated in the proceedings, order the presentation of additional 
material eVidence as part of the appellate proceedings. 
44 
(b) Powers of the Commission Without Hearing. - The Commission shall 
45 
have the power to do the following acts, without hearing: 
46 
47 
(1) Motu Proprio Investigation or Upon 
Complaint 
-
To 
48 
investigate, on its own initiative or upon the complaint of any 
Page 16 of31 


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3 
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5 
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48 
person, any and all violations of this Act and other competition 
laws prior to the commencement of a preliminary investigation, 
or the issuance of a show cause order, or the institution of a 
civil or administrative action; 
(2) Civil Action. - To attest and file on behalf of the State, civil 
complaints for damages to business or property of the State, 
arising from a violation of this Act and other competition laws; 
(3) Administrative Action. - To attest and file all complaints for 
appropriate administrative relief from, or against, violations of 
this Act or other trade competition laws; 
(4) Request for Assistance. - To require any government agency 
to lend assistance and information necessary in the discharge 
of its responsibilities under this Act, and examine if necessary, 
pertinent records and documents in the possession of such 
government agency; 
(5) Industry Studies and Company Profile. - To gather and compile 
information and investigate from time to time, the way a given 
industry is structured or organized whether as a monopoly, 
oligopoly, or competitive; the way the firms within that industry 
act, behave, or conduct themselves in such matters as setting 
prices, determining output, and the resulting performance of 
the industry as a whole; the organization, business, conduct, 
practices and management of any person, partnership, or 
corporation engaged in trade, commerce, or industry and its 
relation to individuals, partnerships, associations, corporations, 
firms and other business enterprises; 
(6) Issuance of Subpoena. - To issue subpoena, subpoena duces 
tecum and subpoena ad testificandum in the exercise of its 
functions, powers and duties under this Act, subject to the 
following standards: 
i. 
No subpoena shall be issued to require the production or 
disclosure of trade secrets as defined in sub-paragraph (7) 
hereof; 
ii. A subpoena may be quashed only by means of a motion 
duly set for hearing and on the grounds prescribed by the 
Rules of Court; 
iii. 
A person appearing before the Commission, or any of its 
Divisions, in obedience to a subpoena shall be advised, 
before he 
is 
required 
to testify or produce any 
documentary or real evidence, of his right to be assisted or 
represented by a counsel of his choice, or if he has none, 
Page 17 of 31 


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45 
46 
47 
48 
the Commission shall appoint a de officio counsel for him; 
and of his rights to avail of the immunity from prosecution 
privilege herein prescribed; 
(7) Annual and Special Reports, etc. - To require, by general or 
special orders, firms engaged in trade, commerce, or industry 
to file with the Commission in such form as the Commission 
may prescribe, annual or special reports, or answers in writing 
to specific questions, 
furnishing 
the 
Commission 
such 
information as it may require as to the organization, business, 
conduct, practices, management and relation to other persons 
of the respective natural or juridical persons or entities filing 
such reports or answers in writing except that the Commission 
shall not require, either by a specific order or by a subpoena, 
the disclosure or production of trade secrets such as a secret 
formula, pattern, device or compilation of information, 
including names of customers, which is used in one's business 
and which gives one an opportunity to obtain advantage over 
competitors who do not know or use it. Trade secrets shall 
include a plan or process, tool, mechanism, or compound 
known only to the owner and his employees to whom it is 
necessary to confide it; 
(8) Public Disclosure of Information. - To make public, from time 
to time, such portions of the information obtained by it under 
this Act, except trade secrets and names of customers, as it 
shall deem expedient in the public interest; 
(9) Reports and Recommendations to Congress. -
To submit 
annual and special reports to Congress, including proposed 
legislation for the regulation of trade, commerce, or industry, 
and provide for the publication of its reports and resolutions in 
such form and manner as may be best adopted for public 
information and transparency; 
(10) Trade Conditions, Domestic and Foreign. - To study, from time 
to time, trade conditions in and with foreign countries where 
aSSOCiations, combinations, or practices of manufacturers, 
merchants, or traders, or other conditions, may affect the 
foreign trade of the Philippines, and report to Congress its 
findings and recommendations thereon as it may deem 
advisable. 
Sec. 10. Jurisdiction of Regional Trial Courts. - The Regional Trial Court 
shall have jurisdiction over all criminal and civil aspects of the violations of this 
act. The venue shall be in accordance with the Rules of Court. 
Page 18 of 31 


1 
2 
3 
CHAPTER IV 
4 
FINES AND PENALTIES 
5 
6 
SEC. 11. Administrative Penalties. -
7 
8 
(aJ Without prejudice to the violation of other laws, any firm that shall be 
9 
found to have violated Sections 8, 9 and 10 of this Act, or any combination 
10 
thereof, shall, for each and every violation, be punished by a fine of not less than 
11 
Ten million pesos (Phpl0,OOO,OOO.00) and not exceeding Fifty million pesos 
12 
(PhpSO,OOO,OOO.OO) if a natural person; by a fine of not less than Two hundred 
13 
fifty million pesos (Php2S0,OOO,OOO.00) but not exceeding Seven hundred fifty 
14 
million pesos (Php7S0,OOO,OOO.00) at the discretion of the Commission. 
15 
16 
In addition, a fine shall be imposed in an amount double the gross 
17 
proceeds gained by the violator/s or double the gross loss suffered by the 
18 
plaintiffs, whichever is higher. 
19 
20 
(b) Failure to Comply with an order of the Commission. -
In 
21 
addition to the administrative penalties, any person who fails or neglects to 
22 
comply with any term or condition of a binding ruling, a cease and desist order or 
23 
an order for readjustment issued by the Commission, shall pay a fine of not less 
! 
24 
than Fifty Thousand Pesos (PhpSO,OOO.OO) for each violation. Each violation shall 
25 
be deemed a separate offense: Provided, That in the case of a violation through 
26 
a continuing failure or neglect to comply, each day of continuance of such failure 
27 
or neglect shall be deemed a separate offense. 
28 
29 
(c) Supply of Incorrect or Misleading Information. - In addition to 
30 
(a) and (b) above, the Commission may likewise impose upon persons or entities 
31 
fines of not less than Five Thousand Pesos (PhpS,OOO.OO) to not more than One 
32 
Hundred Thousand Pesos (Phpl00,OOO.00) where, intentionally or negligently, 
33 
they supply incorrect or misleading information in any document, application or 
34 
other paper filed with or submitted to the Commission or supply incorrect or 
35 
misleading information in an application or other paper filed with or submitted to 
36 
the Commission or supply incorrect or misleading information in an application 
37 
for a binding ruling, a proposal for a consent judgment, proceedings relating to a 
38 
show cause order, or application for modification of the Commission's ruling, 
39 
order or approval, as the case'may be. 
40 
41 
Sec. 12. Criminal Penalties. - Without prejudice to the violation of other laws, 
42 
any firm that shall be found to have violated Sections 8, 9 and 10 of this Act, or 
43 
any combination thereof, shall, for each and every violation, be punished by a 
44 
fine of not less than Ten million pesos (Phpl0,OOO,OOO.00) and not exceeding 
45 
Fifty million pesos (PhpSO,OOO,OOO.OO) if a natural person; by a fine of not less 
46 
than Two hundred fifty million pesos (Php2S0,OOO,OOO.OO) but not exceeding 
47 
Seven hundred fifty million pesos (Php7S0,OOO,OOO.00) if a firm, and 
by 
48 
imprisonment not exceeding ten (10) years, or both, at the discretion of the 
Page 19 of 31 


1 
court. In the alternative, a fine shall be imposed in the amount double the gross 
2 
proceeds gained by the violator or double the gross loss suffered by the plaintiffs. 
3 
4 
CHAPTER V 
5 
ENFORCEMENT 
6 
7 
SEC. 13. Preliminary Inquiry. - The Commission shall motu propriq or upon 
8 
the filing of a verified complaint by an interested party or upon referral by the 
9 
concerned regulatory agency, initiate a preliminary inquiry for the enforcement of 
10 
this Act. 
11 
12 
SEC. 14. Power over acts committed prior to the passage of this law. -
13 
Subject to the constitutional prohibition on the passage of ex post facto laws, the 
14 
Commission shall have the power to decide on and regulate acts related to 
15 
competition issues despite the fact that the acts complained of were committed 
16 
or the contracts were perfected or consummated prior to the passage of this law. 
17 
This power shall inc/ude orders to break-up mergers and consolidations and un-
18 
bundle products sold as a package. 
19 
20 
21 
Sec. 15. Powers of Concerned Regulatory Agencies. - Notwithstanding the 
22 
provisions of the preceding section, the exercise of regulatory powers by 
23 
different government agencies over an industry or a sub-sector of an industry 
24 
shall be cumulative and shall not be construed in any way as derogating from the 
25 
power and authority of the concerned agency; Provided, that: the Commission 
26 
shall have exclusive jurisdiction over competition matters, including all of the 
27 
prohibited acts under this Act and other laws, but can decide on competition 
28 
issues only after requesting and obtaining technical assistance from the 
29 
regulatory agencies. 
30 
31 
32 
33 
The government agencies shall cooperate and coordinate with one 
34 
another in the exercise of their powers in order to prevent overlap, to share 
35 
confidential information, or for other effective measures. 
The failure of the 
36 
regulatory agencies to provide technical assistance or opinion after having been 
37 
given a reasonable time, shall not prevent the Commission from performing its 
38 
functions in a timely manner; Provided, that: in situations where time is of the 
39 
essence, and the CommiSSion cannot suspend its action and wait for the opinion 
40 
of the regulatory agencies, the Commission may so decide or act accordingly, 
41 
without prejudice to correcting or modifying its action after obtaining the opinion 
42 
of the regulatory agency. 
43 
44 
SEC. 16. Power to Investigate and to Enforce Orders and Resolutions. -I 
45 
The Commission shall conduct preliminary inquiries by administering oaths, 
46 
issuing subpoena duces tecum and summoning witnesses, and commissioning 
47 
consultants or experts. It shall determine if any provision of this Act has been 
48 
violated, enforce its orders and carry out its resolutions by making use of any 
Page 200f 31 


1 
available means, provisional or otherwise, under existing laws and procedures 
2 
including the power to punish for contempt and to impose fines. 
3 
4 
Sec. 17. Self-incrimination. Pursuant to the preceding section, a person 
5 
subject of any preliminary inquiry or 
investigation by the Commission shall 
6 
produce the specified document or information when so required by written 
7 
notice: Provided, That no person shall be excused from disclosing any document 
8 
or information to the inquiring officer on the ground that the disclosure of the 
9 
information or document may be incriminating: Provided, furthe", That such 
10 
document or information produced by the person subject of investigation shall 
11 
not be admissible as evidence against him in criminal proceedings: Provided, 
12 
finally, That such document or information shall be admissible in evidence in civil 
13 
proceedings including those arising from or in connection to the implementation 
14 
of this Act. 
15 
16 
Sec. 18. Privileged Communication Exclusion. Nothing in the preceding 
17 
section shall compel the disclosure of privileged communication: Provided, That 
18 
the person who refuses to disclose the information or produce the document or 
19 
other material required by the inquiring officer in relation to the preliminary 
20 
inquiry being conducted shall nevertheless be obliged to give the name and 
21 
address of the firm to whom, or by whom, or on whose behalf, such privileged 
22 
communication was made. 
23 
24 
Sec. 19. Confidentiality of Information. Any document or information 
25 
submitted by firms, as determined and marked confidential by the Commission, 
26 
relevant to any investigation being conducted pursuant to this Act shall not, in 
27 
any manner, be directly or indirectly disclosed, published, transferred, copied, or 
28 
disseminated. 
The identity of persons who provide information to the 
,! 
29 
Commission and who need confidentiality to protect themselves against economic 
30 
retaliation, and any Commission deliberations_in regard to current or still 
31 
uncompleted matters shall remain confidential. l 
32 
33 
Any violation of this provision shall be imposed a fine of not less than One 
34 
hundred thousand pesos (PhplOO,OOO.OO) but not more than Five hundred 
35 
thousand pesos (Php500,OOO.00). 
36 
37 
Sec. 20. Immunity from Suit Any person or firm which cooperates or 
38 
furnishes any information, document or data to the Commission before or during 
39 
the conduct of the preliminary inquiry that constitutes material evidence as 
40 
determined by the under this Act shall be immune from any suit or charge 
41 
including from affected parties and third parties: Provided, that the person or 
42 
firm is not the most guilty. Provided, further, That any person or firm which 
43 
cooperates or furnishes information, document or data to the Commission in 
44 
connection to an investigation being conducted shall not be subjected to any 
45 
form of reprisal or discrimination: Provided, furthermore, That such reprisal or 
1 Taken from the UNCTAD Model Law on Competition. 
Page 21 of 31 


1 
available means, provisional or otherwise, under existing laws and procedures 
2 
including the power to punish for contempt and to impose fines. 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
Sec. 17. Self-incrimination. Pursuant to the preceding section, a person 
subject of any preliminary inquiry or 
investigation by the Commission shall 
produce the specified document or information when so required by written 
notice: Provided, That no person shall be excused from disclosing any document 
or information to the inquiring officer on the ground that the disclosure of the 
information or document may be incriminating: Provided, further, That such 
document or information produced by the person subject of investigation shall 
not be admissible as evidence against him in criminal proceedings: Provided., 
finally, That such document or information shall be admissible in evidence in civil 
proceedings including those arising from or in connection to the implementation 
of this Act. 
16 
Sec. 18. Privileged Communication Exclusion. Nothing in the preceding 
17 
section shall compel the disclosure of privileged communication: Provided, That 
18 
the person who refuses to disclose the information or produce the document or 
19 
other material required by the inquiring officer in relation to the preliminary 
20 
inquiry being conducted shall nevertheless be obliged to give the name and 
21 
address of the firm to whom, or by whom, or on whose behalf, such privileged 
22 
communication was made. 
23 
24 
Sec. 19. Confidentiality of Information. Any document or information 
25 
submitted by firms, as determined and marked confidential by the Commission, 
26 
relevant to any investigation being conducted pursuant to this Act shall not, in 
27 
any manner, be directly or indirectly disclosed, published, transferred, copied, or 
28 
disseminated. 
The identity of persons who provide information to the 
29 
Commission and who need confidentiality to protect themselves against economic 
30 
retaliation, and any Commission deliberations in regard to current or still 
31 
uncompleted matters shall remain confidential. 1 
32 
33 
Any violation of this provision shall be imposed a fine of not less than One 
34 
hundred thousand pesos (Php100,OOO.OO) but not more than Five hundred 
35 
thousand pesos (PhpSOO,OOO.OO). 
36 
37 
Sec. 20. Immunity from Suit Any person or firm which cooperates or 
38 
furnishes any information, document or data to the Commission before or during 
39 
the conduct of the preliminary inqUiry that constitutes material evidence as 
40 
determined by the under this Act shall be immune from any suit or charge 
41 
including from affected parties and third parties: Provided, that the person or 
42 
firm is not the most gUilty. Provided., further, That any person or firm which 
43 
cooperates or furnishes information, document or data to the Commission in 
44 
connection to an investigation being conducted shall not be subjected to any 
45 
form of reprisal or discrimination: Provided., furthermore, That such reprisal or 
l Taken from the UNCTAD Modeflaw on Competition. 
Page 21 of 31 
.! 


I 
discrimination shall be considered a violation of this Act and subjected to the 
2 
penalties provided for under Section 11. 
3 
4 
Nothing in this section shall preclude the prosecution of persons and firms 
5 
who furnished the Commission with malicious information, data and falsified 
6 
documents which is damaging to the business and integrity of the persons and 
7 
firms under inquiry. Such act shall likewise be considered as an unfair trade 
8 
practice punishable under this Act. 
9 
10 
The Commission may refuse to admit information, document or data that 
II 
is merely corroborative or is not essential for the conduct of the preliminary 
12 
inquiry. 
13 
14 
Any person or firm which cooperates or furnishes any information, 
IS 
document or data to the Commission before or during the conduct of the 
16 
preliminary inquiry that constitutes material evidence as determined by the under 
17 
this Act shall be immune from any suit or charge related to such disclosure. 
18 
19 
SEC. 21. Termination and Action on Preliminary Inquiry. -The Commission, 
20 
after considering the statements made, or documents or articles produced, in the 
21 
course of an inquiry conducted by it, shall terminate the preliminary inquiry by 
22 
issuing a resolution ordering its closure if no violation or infringement of this Act 
23 
is found; or by issuing a nolo contendere resolution; or issuing a resolution to, 
24 
singly or cumulatively, (a) impose penalties in the range provided under Section 
25 
11 hereof; (b) order the rectification of certain acts or omissions; or (c) order the 
26 
restitution to the affected parties. 
27 
28 
When determined by the facts and circumstances, the Commission shall 
29 
institute a civil action by class suit in the name of the Republic of the Philippines, 
30 
as parens patriae, on behalf of persons residing in the Philippines, to secure 
31 
treble damages for any injury sustained by such persons by reason of any 
32 
violation of this Act, plus the cost of suit and reasonable attorney's fee. 
33 
34 
If the evidence so warrants, the Commission shall file criminal cases for 
35 
violation of this Act or relevant laws before the Department of Justice pursuant to 
36 
Section 12 of this Act. 
37 
38 
Any decision or order of the Commission to lodge a criminal complaint with 
39 
the Department of Justice shall not be the subject of a motion for reconsideration 
40 
and shall not be subject to appeal. After rendering such decision or order, the 
41 
Commission shall file a criminal complaint with the Department of Justice, which 
42 
shall then conduct the requisite preliminary investigation in accordance with the 
43 
Rules of Criminal procedure in the Rules of Court. 
44 
45 
SEC. 22. Nolo Contendere Resolution. - Any firm under inquiry under the 
46 
proVisions of this Act may submit to a nolo contendere resolution at any time 
47 
before the termination of the preliminary inquiry by: a) the payment of an 
48 
amount within the range of penalties provided for under Section 11; b) by 
Page 22 of 31 
! 


entering into an undertaking to effectively stop and rectify the acts complained 
2 
against, make restitution to the affected parties, whether or not the parties are 
3 
plaintiffs or witnesses; and, c) by submitting regular compliance reports as may 
4 
be directed: Provided, That, ten percent (10%) of the amounts paid under this 
5 
section shall equitably accrue to the Commission: Provided, further, That a nolo 
6 
contendere resolution shall not bar any inquiry for the same or similar acts if 
7 
continued or repeated. 
8 
9 
SEC. 
23. 
Implementing Policy; Non-Adversarial Administrative 
10 
Remedies. - As an implementing and enforcement policy, the Commission shall, 
11 
under such rules and regulations it may prescribe, encourage voluntary 
12 
compliance with this Act and other competition laws by making available to the 
13 
parties concerned the following and other analogous non-adversarial and non-
14 
adjudicatory administrative remedies, before the institution of administrative, civil 
15 
or criminal action: 
16 
17 
(a) Request for Binding Ruling. -
Any person who is in doubt as to 
18 
whether his contemplated or existing act, course of conduct, 
19 
agreement, decision or practice is in compliance with, is exempt from, 
20 
or in violation of any of the provisions of this Act, other trade 
21 
competition laws, or implementing rules and regulations thereof, may 
22 
request the Commission, in writing, to render a binding ruling thereon; 
23 
24 
(b) Show Cause Order. - Upon preliminary findings motu proprio or on 
25 
written complaint under oath by an interested party, that any person is 
26 
conducting his business, in whole or in part, that any person is 
27 
conducting his business, in whole or in part, in a manner that may not 
28 
be in accord with the provisions of this Act or other trade competition 
29 
laws, and it finds that the issuance of a show cause order would be in 
30 
the interest of the public, the Commission shall issue and serve upon 
31 
such person or persons a written description of its business conduct 
32 
complained of, a statement of the facts, data, and information together 
33 
with a summary of the evidence thereof, with an order requiring the 
34 
said person or persons to show cause, within the period therein fixed, 
35 
why no order shall issue requiring such person or persons to cease and 
36 
desist from continuing with ties identified business conduct, or pay the 
37 
administrative fine therein specified, or readjust its business conduct or 
38 
practices; 
39 
40 
(c) Proposal for Consent Judgment - At any time prior to the issuance of 
41 
a binding ruling, the promulgation of a cease and desist judgment 
42 
under a show cause order or the promulgation of a decision of 
43 
judgment in any administrative, civil, or criminal case, the person or 
44 
persons, whose business conduct is under inquiry in the particular 
45 
proceedings may, without in any manner admitting a violation of this 
46 
Act or any other trade competition laws, submit to the Commission a 
47 
written proposal for the entry of a consent judgment, specifying 
48 
therein the terms and conditions of the proposed consent judgment. 
Page 23 of 31 


1 
2 
Cd) Consultations. - Prior to the fitting of a request for a binding ruling or 
.! 
3 
the submission of a proposal for consent judgment, the person or 
4 
persons concerned may communicate, in writing, with the Commission 
5 
on matters that should be included or excluded in such request or 
6 
proposal, which the Commission may consider necessary for the 
7 
effective enforcement of this Act or other trade competition laws. 
8 
9 
(e) Binding Rulin{k Cease and Desist Order, and Consent Judgment -
10 
Based upon the facts, data, and information disclosed or supplied by 
11 
the persons concerned, or established by substantial evidence during 
12 
the hearing, the Commission shall issue a binding ruling, a cease and 
13 
desist order or an approval of the proposal for a consent judgment, as 
14 
the case may be, with or without conditions, to the effect that the 
15 
particular act, course of conduct, agreement, decision or practice is in 
16 
accord with this Act or other trade competition laws, or is exempt 
17 
therefrom, or is constitutive of a violation thereof. If the Commission 
18 
finds that there is substantial evidence tending to show that the act, 
19 
course of conduct, agreement, decision or practice of the person or 
20 
persons concerned is prohibited, it shall include in its decision an order 
21 
requiring the person or persons concerned: 
22 
23 
(1) Cease and Desist Order. - To cease and desist from continuing 
24 
with the identified act, course or conduct, agreement, decision, 
25 
or practice found to be violative of the provisions of this Act; 
26 
(2) Administrative Penalty or Fine. - To pay the fine therein fixed; 
27 
and 
28 
(3) Readjustment of Business Methods. - To readjust, within a 
29 
reasonable period therein fixed, its method of doing business, 
30 
including a corporate reorganization or divestment in the 
31 
manner and under the terms and conditions prescribed by the 
32 
Commission, as it may deem proper for the protection of the 
33 
public interest. 
34 
35 
(f) Suspension of Administrative, Civil or Criminal Proceedings. -
No 
36 
pending administrative, civil or criminal proceedings or those filed 
37 
thereafter, against any person, corporation or any other juridical entity 
38 
or its officers and employees, shall be suspended, except upon order of 
39 
the Commission on proper motion, on the ground of the filing of a 
.! 
40 
request for binding ruling, the issuance of a show cause order or the 
41 
filing of a proposal for a consent judgment based, in whole or in part, 
42 
on the same set of facts and issues as that of the proceedings sought 
43 
to be suspended; 
44 
45 
(g) Monitoring of Compliance. -
The Commission shall monitor the 
46 
compliance by the person or persons concerned, their officers, and 
47 
employees, with the final and executory binding ruling, cease and 
48 
desist order, or approval of a consent judgment. Upon motion of an 
Page 24 of31 


I 
interested party, the Commission shall issue a certification to the effect 
2 
that the person or persons concerned have, or have not, as the case 
3 
may be, complied with a final and executory ruling, order, or approval; 
4 
5 
(h)Jnadmissibility in Evidence. - The request for a binding ruling, the 
6 
show cause order, or the proposal for consent judgment; the facts, 
7 
data, and information therein contained or subsequently supplied by 
8 
the person or persons concerned; admissions, oral or written, made by 
9 
them against their interest; all other documents filed by them including 
10 
their evidence presented in the proceedings before the Commission; 
11 
and the judgment rendered thereon, shall not be admissible as 
12 
evidence in any administrative, civil or criminal proceedings against 
13 
such person or persons, their officers, employees, and agents nor 
14 
constitute a basis for the introduction of the binding ruling, the cease 
15 
and desist order, or the consent judgment as prima facie evidence 
16 
against such persons in any such action of proceeding; 
17 
18 
(i) Modification or Reversal of RuJin{k Order or Approval. -
The 
19 
Commission may motu proprio or upon petition of an interested party, 
20 
after notice and hearing, reopen and alter, modify, or set aside, in 
21 
whole or in part, a binding ruling, a cease and desist order, or an 
22 
approved consent judgment: 
23 
, 
24 
(1) 
Whenever conditions of material fact or law have so 
25 
changed as to require such action; 
26 
(2) 
When the concerned person or persons fail or refuse, 
27 
without justifiable cause therefore, to comply with any 
28 
condition attached to such ruling, order, or approval, 
29 
including an order to readjust their method of doing 
30 
business; or 
31 
(3) When the ruling, order, or approval was based on 
32 
deliberately falsified material fact, data, or information 
33 
supplied by an interested party benefited by such ruling, 
34 
order, or approval. 
35 
36 
The modification or reversal of a binding ruling, a cease and desist 
37 
order, or an approved consent judgment shall have no retroactive effect 
38 
and shall not affect or impair any right legally acquired prior to the 
39 
modification or reversal thereof, except, that the party who is guilty of 
40 
unjustified failure or refusal to comply as specified in paragraph (2) 
41 
hereof, or have deliberately supplied such falsified material fact, data or 
42 
information as specified in paragraph (3) above, is barred from claiming 
43 
any vested right therein. 
44 
45 
SEC. 24. Contempt - The Commission, or any of its DiviSions, may summarily 
46 
punish for contempt, or by a fine not exceeding thirty (30) days, or both, any 
47 
person guilty of such misconduct in the presence of the Commission or any of its 
48 
Divisions in its vicinity as to seriously interrupt any hearing, session or any 
Page 25 of 31 


1 
proceedings before it, including cases in which a person willfully fails or refuses, 
2 
without just cause, to comply with a summons, subpoena or subpoena duces 
3 
tecum legally issued by the Commission or any of its Division, being present at a 
4 
hearing, proceeding, session or investigation, refused to be sworn as a witness or 
5 
to answer questions or to furnish information when lawfully required to do so. 
6 
7 
SEC. 25. 
Decisions of the Commission. - DeCisions of the Commission en, 
8 
bane shall be appealable to the Court of Appeals as hereinafter provided. The 
9 
appeal shalf not stay the order, ruling or decision sought to be reViewed, unless 
10 
the Court of Appeals shall direct otherwise upon such terms and conditions it 
11 
may deem just. 
12 
13 
SEC. 26. 
Appeal to the Court of Appeals. - Any party who has actively 
14 
participated in the proceedings before the Commission and is adversely affected 
15 
by a binding ruling, order, or resolution, decision, judgment, rule or regulation 
16 
promulgation after notice and hearing by the Commission sitting en bane, may 
17 
appeal, by means of a notice of appeal and a verified petition for review served 
18 
upon the Commission and other parties who actively participated in the 
19 
proceedings, to the Court of Appeals within thirty (30) days from receipt thereof, 
20 
on the ground that the appealed action of the Commission: 
21 
22 
(a) 
is contrary to constitutional rights, power, privilege, or immunity; 
23 
(b) is in excess of statutory jurisdiction, authority, or limitations, or is 
24 
contrary to law; 
25 
CC) 
is without observance of the procedure required by law; 
26 
Cd) 
is not supported by substantial evidence. 
27 
(e) contains errors on findings of fact; or 
28 
Cf) 
contains errors on conclusions of law. 
29 
30 
The Commission shall be included as a party respondent to the case and 
31 
shall be represented by its own legal staff. 
32 
33 
The Commission shall be included as a party respondent to the case and 
34 
shalf be represented by its own legal staff. 
35 
36 
Sj:c. 27. Appeal to the SUpreme Court. - A decision of the Court of Appeals 
37 
may be appealed to the Supreme Court in the manner and on the grounds 
38 
prescribed by the Rules of Court. 
39 
40 
SEC. 28. 
Reception of Additional Evidence. - Any party in the appellate 
41 
proceedings may apply for leave to the Court of Appeals or the Supreme Court, 
42 
to adduce additional eVidence before the Commission. The Court may, under 
43 
such terms and conditions as it may prescribe, order the Commission to receive 
44 
such additional evidence upon showing that it is material and there are 
t 
45 
reasonable grounds for the failure to present said evidence in the proceedings 
46 
before the Commission. 
The Commission, sitting en banc, may modify its 
47 
findings as to the facts, or make new findings, by reason of the additional 
48 
evidence taken, and it shall file with the appellate court such modified or new 
Page 26 of 31 


I 
findings and its recommendations for the affirmance, modification, or setting 
2 
aside of the appealed binding ruling, order, resolution, decision, judgment, rule 
3 
or regulation. 
4 
SEC. 29. 
Writ of Execution. - Upon the finality of its binding ruling, order, 
5 
resolution, decision, judgment, or rule or regulation, (collectively, "Decision"), 
6 
the Commission may issue a writ of execution to enforce its decision and the 
7 
payment of the administrative fines provided in the preceding sections. 
8 
9 
SEC. 30. 
Violation by Corporation, Partnership, Association, and Other 
10 
Entity. -
Whenever a corporation, partnership, association, firm or other entity, 
11 
whether domestic or foreign, shall commit any of the acts declared to be 
12 
unlawful under this Act, the Chairman of the Board of Directors, the President, 
13 
the General Manager of the corporation, the general partners of a partnership, 
14 
and the officers and employees directly responsible, shall be jOintly and severally 
15 
liable with the firm for the fine imposed therein. 
16 
17 
Should the offense be committed by a foreign corporation licensed to do 
18 
business in the Philippines, the person or persons directly responsible in the 
19 
Philippines for the management and operation thereof, shall be liable. 
In 
20 
addition, its license to do bUSiness in the Philippines shall be cancelled. 
21 
22 
It shall not be a defense for the Chairman of the Board of Directors, the 
23 
President or the General Manager of the corporation or the general partners of a 
24 
partnership, or the persons responsible for the management and operation of a 
25 
foreign corporation licensed to do business in the Philippines, that he was 
26 
unaware of the violation, unless, he shall have established to the satisfaction of 
27 
the court that even with the exercise of due diligence and proper supervision, he 
28 
could not have avoided or prevented the Violation. 
29 
30 
Any agreement between an officer, partner or any other officer and a 
31 
corporation or partnership whereby the latter directly or indirectly agrees to 
32 
assume, satiSfy or indemnify, in whole or in part, the fine of civil obligation 
33 
imposed under this Act of such corporate officer, partner, manager or other 
34 
officer found guilty of violating this Act, shall be void. 
35 
36 
SEC. 31. Alien Violators. - If the person violating any provision of this Act is a 
37 
foreigner, he shall, in addition to the other penalties imposed herein, be deported 
38 
after service of sentence without need of any further proceedings. 
39 
40 
SEC. 32. 
Essential Commodities. - If the violation involves the trade or 
41 
movement of prime commodities such as rice, corn, sugar, chicken, pork, beef, 
42 
fish, vegetables, and other articles or commodities of prime or basic necessity as 
43 
declared by the appropriate government agency, through publication, the fine 
44 
imposed by the Commission or the courts, as the case may be, shall 
45 
automatically be tripled and the offender shall pay such threefold fine. 
46 
47 
SEC. 33. 
Private Action. -
Regardless of the status or pendency of any 
48 
proceedings, any firm that suffers injury by reason of any violation of this Act 
Page 27 of 31 


I 
may institute a separate and independent civil action, irrespective of the amount 
2 
involved in the controversy against the defendant or defendants and shall 
3 
recover treble damages sustained, the costs of suit and reasonable attorney's 
4 
fees: Providect however, That no filing fees shall be collected: Provided, further, 
,! 
5 
That filing fees shall constitute a first lien in the award of damages. 
6 
7 
SEC. 34. Effect of Final Judgment. - Any final judgment in a civil or criminal 
8 
action brought by the Commission on behalf of the people of the Philippines 
9 
under this Act to the effect that a defendant has Violated any or all of the 
10 
provisions of this Act shall be res judicata as to any claim by any person on 
11 
whose behalf such action was brought: Provided, That such person notifies the 
12 
court having jurisdiction of the case within the period given by the court: 
13 
Providect further, That such period shall not be less than ninety (90) days. 
14 
15 
It shall be prima facie evidence against such defendant in any civil action 
16 
brought by any other party against such defendant under this Act as to all 
17 
matters respecting which said judgment would be an estoppel as between the 
18 
parties concerned. 
19 
20 
SEC. 35. Distribution of Damages Recovered. - The damages recovered in a 
21 
civil action under Section 20 of this Act shall be distributed in the following 
22 
manner: (1) as determined and to be authorized by the Court having jurisdiction 
23 
of the case; (2) ten percent (10%) of the total amount of damages shall accrue 
24 
to the Commission and/or regulatory agency to be used exclusively in the 
25 
enforcement of this Act; and, (3) the remainder of which total amount of 
26 
damages shall be deemed a civil penalty by the Court and shall be depOSited to 
27 
the National Treasury as part of the general fund of the government: Provided, 
28 
That any distribution procedure adopted by the Court shall give preference to 
29 
individual consumers and afford each person having an interest a reasonable 
30 
opportunity to secure his appropriate portion of the net damages obtained. 
31 
32 
SEC. 36. Measurement of Damages. - Damages may be proved and assessed 
33 
in the aggregate by statistical or sampling methods, by the computation of illegal 
34 
overcharges, or by such other reasonable system of estimating aggregate 
35 
damages as the court in its discretion may permit without the necessity of 
36 
separately proving the individual claim, of, or amount of damage to, persons on 
37 
whose behalf the suit was brought. 
38 
39 
CHAPTER VI 
40 
OTHER PROVISIONS 
41 
I 
42 
SEC. 37. Statute of Limitations. - Any civil or criminal action to enforce any 
43 
cause of action arising from a violation of any provision of this Act shall be 
44 
forever barred unless commenced within five (5) years after the cause of action 
45 
accrues. The running of the statute of limitation shall be suspended during the 
46 
pendency of any proceeding. 
47 
Page 28 of 31 


1 
The cause of action begins to run when the plaintiff suffers injury to its 
2 
business or property: Provided, That when the damage suffered by the plaintiff is 
3 
too speculative to prove, the cause of action does not accrue until the damage 
4 
becomes probable: Providect however, That if the plaintiff's injury is the result of 
5 
the continuing violations of this Act, each independent anti-competitive act may 
6 
restart the limitation period or when a plaintiff reasonably fails to uncover a 
7 
cause or action that was fraudulently concealed by a defendant. 
8 
9 
SEC. 38. Prohibition on the Issuance of Temporary Restraining Orders, 
10 
Preliminary Injunctions and Preliminary Mandatory Injunctions. -
11 
Except for the Supreme Court, no other court shall issue any temporary 
12 
restraining order, preliminary injunction or preliminary mandatory injunction 
13 
against the Commission in the exercise of its duties or functions: Providect That, 
14 
this prohibition shall apply in all cases, disputes or controversies instituted by a 
15 
private party, including, but not limited to, cases filed by regulated firms or those 
16 
claiming to have rights through such firms: Providect however, That, this 
17 
prohibition shall not apply when the matter is of extreme urgency involving a 
18 
constitutional issue, such that the non-issuance of a temporary restraining order 
19 
will result in grave injustice and irreparable injury to the public: 
Providect 
20 
further, That, the applicant shall file a bond, in an amount to be fixed by the 
21 
Court, but in no case shall it be less than half of the imposable fines provided for 
22 
under Section 11 of this Act: Providect finally, That in the event that the court 
23 
finally decides that the applicant was not entitled to the relief applied for, the 
24 
bond shall accrue in favor of the Commission. 
25 
26 
Any temporary restraining order, preliminary injunction or preliminary 
27 
mandatory injunction issued in violation of this section is void and of no force and 
28 
effect. Any judge who violates this section shall be penalized by suspension of at 
29 
least one (1) year without pay in addition to other criminal, civil or administrative 
30 
penalties. 
31 
32 
The Supreme Court may deSignate regional trial courts to act as 
33 
commissioners with the sole function of receiving facts of the case involving the 
34 
acts of the Commission. The designated Regional Trial Court shall, within thirty 
35 
(30) days from the date of receipt of the referral, forward its findings of facts to 
36 
the Supreme Court for appropriate action. 
37 
38 
SEC. 39. Intellectual Property Rights. - The implementation of the provisions 
39 
of this Act shall be without prejudice to the rights, liabilities and remedies under 
40 
Republic Act No. 8293, otherwise known as the Intellectual Property Code of the 
41 
Philippines: Provided, That, the exercise of intellectual property rights shall not in 
42 
any way be used to justify violations of this Act. 
43 
44 
SEC. 40. Trade Associations. - Nothing contained in this Act shall be construed 
45 
to prohibit the existence and operation of trade associations organized to 
46 
promote quality standards and safety issues: Provided, That, these associations 
47 
shall not in any way be used to justify any violation of this Act. 
48 
Page 29 of31 
I 


1 
SEC. 
41. Implementing Rules and Regulations. - The Commission shall 
2 
prepare the necessary rules and regulations within one hundred twenty (120) 
3 
days from the effectivity of this Act: Provided, That, where the same would apply 
4 
to an industry or a sub-sector of industry that is subject to the jurisdiction of a 
5 
regulatory agency, the Commission shall, in preparing the gUidelines, consult 
6 
with the concerned regulatory agency and stakeholders: Provi~ further, That 
7 
the Commission may revise such guidelines as it deems necessary: Provided, 
8 
however, That such revised guidelines shall only take effect following its 
9 
publication in two newspapers of general Circulation. 
! 
10 
11 
SEC. 
42. 
Congressional Oversight Committee. 
-
To 
oversee 
the 
12 
implementation of this Act, there shall be created a Congressional Oversight 
13 
Committee on Fair Competition (COCFC) to be composed of the Chairpersons of 
14 
the Senate Committees on Trade and Commerce, Economic Affairs, and Finance; 
15 
the Chairpersons of the House of Representatives Committees on Trade and 
16 
Industry, Economic Affairs and Appropriations; and two members each from the 
17 
Senate and the House of Representatives who shall be deSignated by the Senate 
18 
President and the Speaker of the House of Representatives: Provided, That one 
19 
of the two Senators and one of the two House Members shall be nominated by 
20 
the respective Minority Leaders of the Senate and the House of Representatives. 
21 
The Congressional Oversight Committee shalf be jOintly chaired by the 
22 
Chairpersons of the Senate Committee on Trade and Commerce and the House 
23 
of Representatives Committee on Trade and Industry. The Vice-Chair of the 
24 
Congressional Oversight Committee shall be jOintly held by the Chairpersons of 
25 
the Senate Committee on Economic Affairs and the House of Representatives 
26 
Committee Economic Affairs. 
27 
28 
The Secretariat of the Congressional Oversight Committee on Fair 
29 
Competition shall be drawn from the existing personnel of the Senate and House 
30 
of Representatives 
committees 
comprising 
the 
Congressional 
Oversight 
31 
Committee. 
32 
33 
SEC. 43. Appropriations. - The amount necessary to implement the provisions 
34 
of this Act shall be included in the annual General Appropriations Act. However, 
35 
for the initial budgetary requirements of the Commission, the amount of One 
36 
Hundred Million Pesos (Pl00,OOO,OOO) is hereby appropriated. 
37 
38 
39 
40 
41 
42 
43 
44 
45 
46 
47 
Provided, that all moneys recovered or charges or composition sums 
collected under this Act, other than financial penalties, shall be paid into and 
form part of the moneys of the CommiSSion. 
SEC. 44. Separability Clause. - If any clause, sentence, section or part of this 
Act shall be adjudged by a court of competent jurisdiction to be invalid, such 
judgment shall not affect, impair or invalidate the remainder of this Act, but shall 
be confined in its operation to the clause, sentence, paragraph, section, or part 
thereof directly involved in the controversy. 
Page 30 of 31 
,! 


1 
SEC. 45. Suppletory Application. - For purposes of this Act, the Revised Penal 
2 
Code, as amended, and other applicable laws shall be applied in a suppletory 
3 
character. 
4 
5 
SEC. 
46. 
Repealing Clause. 
-
The following laws, insofar as they are 
6 
inconsistent with any of the provisions of this Act are hereby repealed, amended 
7 
or otherwise modified accordingly: 
8 
9 
(a) Sec. 5 (3) of Republic Act No. 7581 or The Price Act; 
10 
(b) Sec. 5 (f) of Republic Act No. 792.5 or The Public Telecommunications 
11 
Policy Act; 
12 
(c) Sec. 11 (a) and (b) of Republic Act No. 8479 or The Downstream Oil 
13 
Industry Deregulation Act; 
14 
(d) Sec. 45 of Republic Act No. 9136 or The Electric Power Industry Reform 
15 
Act; 
16 
(e) Sec. 13 of Republic Act No. 92.95 or The Domestic Shipping Development 
17 
Act; 
18 
(f) Sec. 24 and 2.5 of Republic Act No. 9502 or The Universally-Accessible 
19 
Cheaper and Quality Medicines Act. 
20 
21 
Provided, That in case of conflict between this Act and such provisions of 
22 
existing competition laws and regulations, the provisions of this Act shall prevail. 
23 
24 
SEC. 47. 
Effectivity Clause. - This Act shall take effect fifteen (15) days 
2S 
following its publication in the Official Gazette or in at least two (2) national 
26 
newspapers of general circulation. Provided however, In order to allow affected 
27 
parties time to renegotiate agreements or restructure their business to comply 
28 
with the new competition law, the penal provisions of this Act shall be imposed 
29 
one (1) year after its effectivity. 
30 
! 
31 
Approved, 
Page 31 of 31