PHILIPPINES Law and Practice Contributed by: Francis L. Fragante and Jennifer Marie G. Castro, Cruz Marcelo & Tenefrancia
a market engages in conduct that substantially pre - vents, restricts or lessens competition. Examples include predatory pricing, price discrimination, limit - ing production, markets or technical development and exploitative behaviour towards consumers, customers or competitors. 6.2 Criteria for Antitrust/Competition Review Rule 4 of the IRR of the PCA provides that the PCC, motu proprio or upon notification, shall have the power to review mergers and acquisitions having a direct, substantial and reasonably foreseeable effect on trade, industry or commerce in the Philippines, based on factors deemed relevant by the PCC. In conducting this review, the PCC shall assess whether a proposed merger or acquisition is likely to substantially prevent, restrict, or lessen competition in the relevant market or in the market for goods and services as may be determined by the PCC; and take into account any substantiated efficiencies put for - ward by the parties to the proposed merger or acqui - sition, which are likely to arise from the transaction. In evaluating the competitive effects of a merger or acquisition, the PCC shall endeavour to compare the competitive conditions that would likely result from the merger or acquisition with the conditions that would likely have prevailed without it. Further, the PCC evaluates the competitive effects of a merger or acquisition, and may consider, on a case-by-case basis, the broad range of possible fac - tual contexts and the specific competitive effects that may arise in different transactions, such as: • the structure of the relevant markets concerned; • the market position of the entities concerned; • the actual or potential competition from entities within or outside of the relevant market; • the alternatives available to suppliers and users, and their access to supplies or markets; and
Behavioural remedies seek to address the identi - fied substantial prevention, restriction or lessening of competition (SLC) by regulating the conduct of par - ties, post-transaction. This is achieved by imposing requirements or restrictions on certain conduct of the merged firm post-transaction so that it does not act in an anti-competitive manner or exercise its enhanced market power to foreclose rivals despite having the ability and incentive to do so. Behavioural remedies target and seek to minimise the adverse effects of the transaction by regulating post-merger outcomes. An example is access or non-discrimination obligations. Proposed behavioural remedies must conform to the following: (i) their terms are readily and affordably monitored, (ii) there is a straightforward punishment mechanism with strong deterrence effect for breach, and (iii) there is more benefit to adopt a behavioural remedy than a structural remedy or a structural rem - edy is not feasible. On the other hand, structural remedies affect the structure of the market, usually by creating, restoring or maintaining a firm that will compete independently. These are self-policing and do not require active moni - toring; their effects on the market have a degree of permanence; and they directly address the source of competitive harm by eliminating its root cause. Dives - titure is an example of a structural remedy. Ancillary measures refer to additional steps or condi - tions that the parties must comply with before, dur - ing and/or after the implementation of the remedy to ensure the effectiveness of the proposed remedy. 6.4 Antitrust/Competition Enforcement The PCC has the power to conduct inquiries, inves - tigate and hear and decide on cases involving any violation of the PCA. It may also exercise its powers of review to prohibit mergers and acquisitions that will substantially prevent, restrict or lessen competition in the relevant market. Further, the PCC has the power to issue adjustment or divestiture orders including orders for corporate reorganisation or divestment in the man - ner and under such terms and conditions as may be prescribed in the rules and regulations implementing the PCA.
• any legal or other barriers to entry. 6.3 Remedies and Commitments
Under the PCC’s Merger Remedies Guidelines, the parties may propose behavioural and structural rem - edies, and ancillary measures.
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