Anti-trust issues fester

"Anti-trust issues fester"

by Willie S. Baun

Originally published on 08 March 2011, People's Journal, STREETLIGHTS, p. 4

Also available online here.

"WHENEVER a mall opens in a sleepy town, the local community is normally drawn to imaginings of bustling economic activity, hopefully jobs as well, including small businesses in the vicinity linking with the mall to supply it with backdoor goods and services.

But what if the mall owners and operators were a bunch of bullies only out to dominate the local market, or even drive smaller enterprises out of business? Or plague their suppliers with delayed payments and oppress their employees to meet unrealistic production targets?

What then if not just like the small town the Philippines were viewed as such by some giant multinational companies with absolutely no intention, apparently, to be apostles of fair trade helping to grow the domestic economy?

Noted lawyer and anti-trust advocate Lorna Patajo Kapunan has shown the MNC-victimized Filipino entrepreneurs, small and medium enterprise owners, and employees they can fight back – if only to arouse the government to look at their desperate straits.

This was brought to light recently when a client of Kapunan filed a case of predatory pricing and unfair trade practices against a Swiss food and beverage multinational. The client actually was a group of the distributors allegedly driven to bankruptcy by the MNC’s violation of free-market standards.

The group went straight to the Department of Trade and Industry for redress of numerous grievances only to be told, at the end of tedious documentations, that their case was ultra vires, “not within DTI jurisdiction.”

Admittedly, state agencies were at a loss about which bureau has jurisdiction of such cases, not to mention that the penalties for anti-trust and monopolistic conduct are “laughably negligible,” according to Kapunan.

Thankfully, relief is in sight of the distributors and similarly situated small businessmen. Parallel to relevant Senate measures, House Bill 1980 has been filed by Reps. Jack Ponce-Enrile, Rufus by Rodriguez, and (whadyanno?) Gloria Macapagal-Arroyo.

HB 1980 seeks to stiffly penalize “anti-competitive agreements, abuse of dominant power and anti-competitive mergers” and above all, the “establishment of the Philippine Fair Competition Commission.”

In virtual leap from immunity of restraints in trade, the bill threatens the MNC bullies with up to P750-million in fines if found to be in violation of anti-trust regulations.

Moreover, a fine shall be imposed in an amount double the gross proceeds gained by the violators or double the gross loss suffered by the plaintiffs. Damn right, Jose, from a nation of MNC-dependent distributors, the enactment of HB 1980 into law would call for standing ovation.

Kapunan and her clients, of course, deserve a big applause that, I believe, is bound to strike a resonant chord in the Senate and among the hundreds of thousands of small and medium entrepreneurs all over the country."

Anti-trust bills timely

"Anti-trust bills timely"
by Willie S. Baun
Originally published in People's Journal, 01 February 2011, STREETLIGHTS, p. 4

"Multinational companies, particularly those dealing in "fast-moving goods," have enjoyed an array of privileges that otherwise would not be available to them, not even in their own countries.

What makes the FMCGs so profitable in the domestic market, apart from the usual bias for the "imported," is the participation of local distributors.

Numerous small enterprises take on the difficult job of bringing the FMCGs to the buying public, and set their profit margins based on standard retail prices and bulk-discount costs.

In effect the MNC plays commissary that merely takes care of administrative matters but somehow gets the lion's share of the income earned by the distributors.

'In and of itself,' observed a trade official, 'this is already a rather one-sided business deal.' It was added when flagrantly abused by a giant MNC to the graver prejudice of the distributors - the alarm bells should ring against anti-trust.

Two distributors in particular claim to have fallen under the mercy of one such MNC due to its alleged predatory pricing in direct conflict with the corporate codes enforced by the Department of Trade and Industry.

As this case wider currency in business circles, so has "Anti-Trust" attained buzzword standing. Soon enough, I believe, Senate President Juan Ponce Enrile and Sen. Miriam Defensor-Santiago would be asked to include FMCG distributors and other such outsource companies in appropriate bills they have proposed.

Legal proceedings between the MNC and the distributors showed the multi-national may have perjured. That, moreover, the MNC's counter-affidavits and joint counter-affidavits versus the predatory pricing charge are inconsistent with one another and with the facts of the matter at bar.

When their attention was reportedly called, the MNC executives seemed unmindful of the resulting perjury charges. 'Their rebuttals were at best amusing, and, at worst dismissive. Yeah, as in 'we didn't know or realize we were lying!''

They also posited that 'privilege' and 'right' were synonymous and took issue with the distributors for the focusing on semantics. Cited in the MNC's defense, the Webster's Encyclopedic Dictionary defined 'privilege' as a 'right, immunity, or exemption only by a person beyond the advantages of the most.'

On the other hand, Black's Law Dictionary, the authority on legal terms and legal definitions, indicates 'privilege' as a 'particular and peculiar benefit or advantage enjoyed by a person, company, class, beyond the common advantages of other citizens.'

Common sense, of course, tells us that a right is inherent while a privilege is bestowed. Then again, there's no guarantee that common sense is precisely what it says it is.

In any case, here's Mr. Webster just once more; Anti-trust, adj., Pertaining to the regulation of or opposition to trusts, cartels, pools, monopolies, and other organizations and practices in restraint of trade.

So there, Jose, and trust JPE and Miriam to get it right all the way."

More anti-trust buzz

Click on image to enlarge and to read full article.
Originally published in People's Journal, 27 February 2011.