Competition Law

• Author: Kala ANANDARAJAH LLB (Hons) (National University of Singapore), MBA (Banking and Finance) (Nanyang Technological University of Singapore); Advocate and Solicitor (Singapore); Partner, Head, Competition & Antitrust and Trade Practice, Rajah & Tann Singapore LLP.
• Date: 01 December 2015
• Citation: (2015) 16 SAL Ann Rev 275
• Published date: 01 December 2015

Introduction

10.1 2015 marks the tenth year of establishment of the Competition Commission of Singapore (‘CCS’). At the turn of the decade, CCS unveiled its new mission: ‘Making markets work well to create opportunities and choices for businesses and consumers in Singapore.’ It also unveiled its new vision: ‘A vibrant economy with well-functioning markets and innovative businesses.’ The new mission and vision represent the forward-looking approach which CCS is taking, and how it has been making an effort to adapt to the changing business landscape in Singapore. Change has always been the only constant in economies around the world, simply because businesses will be eliminated if they fail to keep up with the demands of evolving markets and consumers. Competition authorities should also be at the forefront of these changes, for when new business practices emerge, new forms of anticompetitive behaviour may surface as well. Indeed, this is what CCS aims to do.

Overview of CCS's decisions and work in 2015

10.2 Compared to the previous year, CCS issued a reduced number of decisions in 2015. There were two decisions (one of them was provisional and the other pursuant to a notification for decision) issued in relation to anticompetitive agreements under s 34 of the Competition Act (Cap 50B, 2006 Rev Ed) (‘the Act’). There were no infringement decisions of abuse of dominance in 2015, although CCS did commence investigations and ultimately reached settlements with the relevant parties in such abuse investigations. Finally, CCS also received numerous merger notifications in 2015, with four of them cleared, one of them abandoned and three still in the process of review.

10.3 In line with its new mission, CCS has come up with some occasional papers detailing its views and analysis on various developments in competition law. These papers will also be discussed briefly so as to keep up to date with the areas of focus of CCS. CCS has also put out for public consultation proposed amendments to its existing guidelines. These amendments are extensive, and are meant to streamline and provide greater clarity on CCS's enforcement of the Act. In particular, it has been suggested that a new fast track procedure be put in place for infringements falling under ss 34 and 47. Under this new procedure, undertakings who accept liability for violations under the aforesaid sections will be eligible for a reduction in their financial penalty.

Section 34 – Agreements with object or effect of restriction or distorting competition

10.4 Section 34 of the Act prohibits any agreements between undertakings ‘which have as their object or effect the prevention, restriction or distortion of competition within Singapore’. Whilst a number of investigations were undertaken in 2015, CCS only issued one provisional infringement decision in 2015, namely, the decision against ten financial advisory companies for allegedly exerting pressure collectively on iFast Financial Pte Ltd (‘iFast’) to withdraw its online offer of a 50% rebate on commission for life insurance products. This agreement was concluded at a meeting of the Association of Financial Advisers (Singapore) and was found to have contravened s 34 of the Act, as the agreement had the object of preventing iFast from competing effectively by offering a more attractive product to potential customers. If these findings by CCS were to be confirmed, this would be the first decision issued against an agreement made between competitors to prevent a potential entrant from entering the market.

10.5 Separately, CCS reviewed the notification for decision made to it in Proposed Strategic Alliance between Cebu Air, Inc and Tiger Airways Singapore Pte Ltd (CCS 400/009/14) (21 September 2015). In this case, CCS had occasion to review the net economic benefits (‘NEB’), an exemption contained in para 9 of the Third Sched to the Act, derived from the strategic...