C ONVINCING P OLICYMAKERS & G ARNERING G REATER S UPPORT FOR C OMPETITION R EFORMS Rafaelita M. Aldaba PHILIPPINE INSTITUTE FOR DEVELOPMENT STUDIES 13 MARCH 2013, JAIPUR, INDIA COMPETITION REFORMS IN KEY MARKETS FOR ENHANCING SOCIAL & ECONOMIC WELFARE IN DEVELOPING COUNTRIES (CREW PROJECT) CONSUMER UNITY & TRUST SOCIETY (CUTS)

Objectives Identify means/methods/tools that have been most useful in developing countries for communicating with the policy community on competition related issues – How does one communicate with policymakers? – What evidence is required, where are the gaps? – What methods/tools can work? – How to gather data in developing countries? – What could be possible limitations? Draw insights/lessons from Philippine experience that can be useful to the CREW Project

Legal Framework -- background No comprehensive & developed anti-trust law implemented by a central government body Laws dealing with monopolies, combinations in restraint of trade, price control measures & consumer protection Constitution, Revised Penal Code, Civil Code, special legislations, regulatory agencies Senate & House Competition Bills since the late 1980s EO 45 in June 2011: OFC under the Department of Justice as competition office investigate all cases violating competition laws & prosecute violators enforce competition law & policy; supervise competition call on other government agencies for studies & assistance Comprehensive legal framework: on-going deliberations at the House and Senate Constraints: lack of culture of competition, weak consumer groups, inadequacies of the courts, political apathy/opposition

Philippine Institute for Development Studies evidence-based research, information dissemination, advocacy Independent, non-profit, government think tank engaged in long term socio-economic policy research Toward A National Competition Policy for the Philippines (2000): examined state of competition, government policies & interface with competition policy, existing competition laws – Industry focus: manufacturing, cement, oil, telecommunications, banking, air transport, power, ports, shipping – Regulatory & competition interface, Philippine Antitrust framework Regional seminars: Luzon, Visayas, & Mindanao Competition forums in cooperation with other institutions: Manila Competition watch: Policy Notes and Discussion Papers on cement, telecommunications, ports; micro studies linking competition, innovation, productivity studies (manufacturing) ( assessment of competition, Aldaba) (PLDT-Sun merger, Aldaba) ( why cement prices remain high despite zero tariffs, Aldaba) (ports Llanto, Basilio & Basilio) (Medalla et al)

Communicating with policymakers Evidence-based research: solid analytical framework – Flexibility in approaches used, qualitative & quantitative, use competition framework available in empirical literature (data availability) – SCP, efficiency measures, game theory, conjectural variations – Micro data studies: competition, innovation, productivity links Theories, empirical models: presented in layman’s terms Timing of release of competition studies: position papers Vigilance, continued monitoring of industries; engagement of media is important – Price data, newspaper reports of suspected anticompetitive acts, mergers Relationship between PIDS & Policymakers/Lawmakers – MOA between OFC-DOJ & PIDS: research support, policy advise – PIDS: chairs OFC-DOJ’s Working Group on Planning – Senate & House: comment on competition bills & act as resource persons Support by the government & political leadership at the highest level is crucial – Aquino: competition one of his priority legislations; Arroyo:not a priority

Lessons from Philippine Experience In communicating with policymakers evidence-based research is crucial constant communication & dialogues with policymakers, briefings, involvement as Project Steering Committee members regular discussion forums through seminars, brown bags, press briefings and the like where all stakeholders are invited, policymakers given a role, provide reactions & make presentations, engage in public discussions information dissemination through PIDS Policy Notes : non- technical simplified version of discussion papers Limitations Limited financial & human resources – PIDS a very small organization with a small subsidy from the government, resources compete for many other research projects – Expertise in infrastructure: water, telecommunications, government procurement Data availability: government regulators, National Statistics Office, Securities & Exchange Commission, UN COMTRADE data – Firm level data is difficult to obtain, no time series data (Census every 5 years, firm identification is prohibited by law, broad sector classification) – Cooperation among research & government agencies especially in data exchange

T HANK Y OU !