Philippine Competition Act 2024 Flashcards
sec.14 to sec. 22
What is this law about?
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The Philippine Competition Act (PCA) or R.A. 10667 is the primary competition law of the Philippines for Promoting FAIR COMPETITION in the marketplace and PROTECTING well-being of CONSUMERS in the process.
The PCA was passed in 2015 after languishing in Congress for 24 years. It is a game-changing legislation envisioned to improve consumer protection and help accelerate investments and job creation in the country, consistent with the national government’s goal of creating more inclusive economic growth.
Enforcement of this law helps ensure that markets are open and free, challenging anti-competitive business practices while maintaining an environment where competition is driven by business acumen. A competitive market means a market with multiple buyers and multiple sellers, driving market prices lower and offering consumers more choices. A truly competitive market encourages efficiency and innovation, and forces businesses to excel. The act reflects the belief that competition:
promotes entrepreneurial spirit;
encourages private investments;
facilitates technology development and transfer, and
enhances resource productivity.
CHAPTER III
PROHIBITED ACTS
Section 14. Anti-Competitive Agreements. –
Which of the following practices, between or among competitors, is per se prohibited under Section 14(a) of the Anti-Competitive Agreements?
a) Joint investment in technical development
b) Market research collaboration
c) Restricting competition as to price
d) Employee training programs
Correct Answer: c) Restricting competition as to price
CHAPTER III
PROHIBITED ACTS
Section 14. Anti-Competitive Agreements. –
a-
In Section 14(b) of the Anti-Competitive Agreements, what type of agreement between competitors is prohibited?
a) Collaborative research initiatives
b) Market allocation and bid suppression practices
c) Employee benefit negotiations
d) Joint ventures for technological advancements
b-
According to Section 14(c) of the Anti-Competitive Agreements, which agreements may not necessarily be deemed a violation of the Act?
a) Agreements contributing to improving production or distribution
b) Agreements limiting market control
c) Agreements related to employee benefits
d) Agreements on market research sharing
a-
Correct Answer: b) Market allocation and bid suppression practices
Essay Type Question:
Discuss the key provisions of Section 14 of the Anti-Competitive Agreements. Explain the categories of agreements that are per se prohibited, those that are prohibited for having the object or effect of substantially preventing, restricting, or lessening competition, and the exceptions provided under Section 14(c). Provide examples to illustrate the application of these provisions and how they contribute to maintaining fair competition in the market.
CHAPTER III
PROHIBITED ACTS
Section 14. Anti-Competitive Agreements. –
According to Section 14(c) of the Anti-Competitive Agreements, which agreements may not necessarily be deemed a violation of the Act?
a) Agreements contributing to improving production or distribution
b) Agreements limiting market control
c) Agreements related to employee benefits
d) Agreements on market research sharing
Correct Answer: a) Agreements contributing to improving production or distribution
CHAPTER III
PROHIBITED ACTS
Essay Type Question:
Discuss the key provisions of Section 14 of the Anti-Competitive Agreements.
Explain the categories of agreements that are per se prohibited, those that are prohibited for having the object or effect of substantially preventing, restricting, or lessening competition, and the exceptions provided under Section 14(c).
Provide examples to illustrate the application of these provisions and how they contribute to maintaining fair competition in the market.
Section 15. Abuse of Dominant Position
Multiple Choice Questions:
What is a permissible price differential under Section 15(d) of the Prohibited Acts?
a) Price differential reflecting differences in the cost of manufacture
b) Any price difference between customers or sellers
c) Discriminatory pricing without justification
d) Fixed prices for a specific market segment
Correct Answer: a) Price differential reflecting differences in the cost of manufacture
Section 15. Abuse of Dominant Position
Multiple Choice Questions:
According to Section 15(e) of the Prohibited Acts, what agreements are not considered unlawful?
a) Agreements preventing competition among entities
b) Exclusive distributorship agreements with termination rights
c) Price-fixing agreements
d) Agreements restricting intellectual property rights
Correct Answer: b) Exclusive distributorship agreements with termination rights
Section 15. Abuse of Dominant Position
Multiple Choice Questions:
In Section 15(g) of the Prohibited Acts, what entities may be protected against unfairly low purchase prices?
a) Large-scale enterprises
b) Marginalized agricultural producers
c) Exclusively urban enterprises
d) International suppliers
Correct Answer: b) Marginalized agricultural producers
Section 15. Abuse of Dominant Position
Essay Type Question:
Discuss the key provisions of Section 15 of the Prohibited Acts, focusing on the abuse of dominant position.
Explain the various forms of conduct that are prohibited, such as selling below cost, imposing barriers to entry, discriminatory pricing, and restricting production.
Analyze the exceptions provided under the section, including permissible price differentials, lawful agreements, and the role of the Commission in promoting fair competition.
Provide examples to illustrate how these provisions contribute to maintaining a competitive market environment in the Philippines.
CHAPTER IV
MERGERS AND ACQUISITIONS
Section 16. Review of Mergers and Acquisitions.
What is the authority granted to the Commission under Section 16 of the Mergers and Acquisitions chapter?
a) Power to approve all mergers and acquisitions
b) Power to review mergers and acquisitions based on relevant factors
c) Power to initiate mergers and acquisitions
d) Power to veto all mergers and acquisitions
Correct Answer: b) Power to review mergers and acquisitions based on relevant factors
CHAPTER IV
MERGERS AND ACQUISITIONS
Section 16. Review of Mergers and Acquisitions.
Who has the discretion to determine the factors relevant to the review of mergers and acquisitions?
a) Congress
b) The President
c) The Commission
d) The entities involved in the merger
Correct Answer: c) The Commission
CHAPTER IV
MERGERS AND ACQUISITIONS
Section 16. Review of Mergers and Acquisitions.
According to Section 16, what is the primary focus of the Commission’s review of mergers and acquisitions?
a) Profitability of the entities
b) The impact on competition and relevant markets
c) The size of the entities involved
d) The political implications of the merger
Correct Answer: b) The impact on competition and relevant markets
Essay Type Question:
Discuss the significance of Section 16 in the regulation of mergers and acquisitions in the Philippines. Explain the power granted to the Commission and the factors it considers relevant in the review process. Analyze how the review process contributes to maintaining fair competition, protecting consumers, and preventing monopolistic practices. Provide examples of situations where the Commission’s intervention in mergers and acquisitions would be crucial for promoting a competitive market environment.
CHAPTER IV
MERGERS AND ACQUISITIONS
Section 16. Review of Mergers and Acquisitions.
Essay Type Question:
Discuss the significance of Section 16 in the regulation of mergers and acquisitions in the Philippines.
Explain the power granted to the Commission and the factors it considers relevant in the review process.
Analyze how the review process contributes to maintaining fair competition, protecting consumers, and preventing monopolistic practices.
Provide examples of situations where the Commission’s intervention in mergers and acquisitions would be crucial for promoting a competitive market environment.
CHAPTER IV
MERGERS AND ACQUISITIONS
Section 17. Compulsory Notification
What is the threshold value for a merger or acquisition transaction that triggers compulsory notification to the Commission under Section 17?
a) P500 million
b) P1 billion
c) P2 billion
d) P5 billion
Correct Answer: b) P1 billion
CHAPTER IV
MERGERS AND ACQUISITIONS
Section 17. Compulsory Notification
What is the consequence if parties consummate a merger or acquisition agreement without providing the required notification to the Commission?
a) A warning letter
b) Administrative fine of 5% of the transaction value
c) Mandatory approval by the Commission
d) Voiding of the agreement
Correct Answer: b) Administrative fine of 1% to 5% of the value of the transaction