unfair competition practices cao xuan quang – deputy head of unfair competition division...
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UNFAIR COMPETITION PRACTICES
Cao Xuan Quang – Deputy Head of Unfair Competition Division
EXPERIENCES FROM VIETNAM
Viewpoints in this presentation do not necessarily express those of the VCA
Hanoi, March 2011
www.vca.gov.vn www.qlct.gov.vn
CONTENTS
1. VIETNAM COMPETITION AUTHORITY
2. REGULATIONS ON UNFAIR COMPETITON
3. CASES HANDLED BY VCA
www.vca.gov.vn www.qlct.gov.vn
CONTENTS
1. VIETNAM COMPETITION AUTHORITY
2. REGULATIONS ON UNFAIR COMPETITON
3. CASES HANDLED BY VCA
1. Vietnam Competition Authority
A governmental agency under Ministry of Industry and Trade.
Functions: Competition; Anti-dumping, anti-subsidy, application of safeguard measures; Consumer Protection.
VCA’ functions, duties and powers are regulated by the Government.
Vietnam Competition Agencies: Vietnam Competition Authority and Vietnam Competition Council
1. VCA - Functions and duties
Competition: Investigate competition cases on competition
restriction acts. Investigate and handle competition cases on
unfair competition acts and other violations against competition law.
Control the process of economic concentration. Detect and recommend relevant agencies to settle
upon authority issued documents with inappropriate content according to competition law.
Build competition law and policy.
1. VCA - Organization
Leaders Director General: appointed by the Prime Minister
upon the recommendation of Industry and Trade Minister.
Deputy Director Generals: appointed by Industry and Trade Minister.
6 Boards International Cooperation Board ( Board I). Trade Remedies Board (Board II) Consumer Protection Board (Board III) Competition Policy Board (Board IV) Unfair Competition Investigation Board (Board V) Antitrust Investigation Board (Board VI)
1. VCA - Organization
3 Offices: General Office in Hanoi. Branch office in Ho Chi Minh city. Branch office in Da Nang city.
2 Centers Center for Competition and Information Data. Center for Investigator Training.
www.vca.gov.vn www.qlct.gov.vn
1. VCA - Human resource
HUMAN RESOURCE
2007 2008 2009
Number of Staffs
40 60 85
Average age 32 30 29
Major field
Law 10 20 30
Economics 20 35 40
Other 10 15 15
GenderMale 27 42 50
Female 13 28 35
Tile
Bachelor 33 49 62
Master 6 10 17
Ph. D 1 1 1
www.vca.gov.vn www.qlct.gov.vn
CONTENTS
1. VIETNAM COMPETITION AUTHORITY
2. REGULATIONS ON UNFAIR COMPETITON
3. CASES HANDLED BY VCA
2. Law enforced Competition Law:
Adopted by the National Assembly in December 2004 and took effect since July 1st 2005.
Guidance documents: Decree No. 116/2005/ND-CP by the Government
dated September 15th 2005 on enforcing some articles in Competition Law.
Decree No. 120/2005/ND-CP by the Government dated September 30th 2005 on handling violations against competition law.
Decree No. 110/2005/ND-CP by the Government dated August 24th 2005 on management of multi-level sale practices.
2. Related Regulations Intellectual Property Law:
The IP Law 2005: Took effect since 1 July 2006. The law on Amendments to the IP Law 2005: Took
effect as from 01 January 2010. Decree No. 97/ND-CP by the Government dated
September 21st 2010 on sanctioning of administrative violations in industrial property.
Law on Commerce: Law on Commerce 2005: January 21st 2006. Decree No. 06/2008/ND-CP by the Government dated
January 16th 2008 on dealing with breaches in Commercial Activities.
Decree No. 37/ND-CP by the Government dated April 4th 2006 on detailing the Commercial Law regarding Trade Promotion activities.
2. Related Regulations Law on Advertisement
Ordinance on Advertisement: Took effect since 1 May 2002.
Decree No. 24/2003/ND-CP by the Government dated March 13th 2003 on detailing articles of the ordinance on advertisement.
Decree No. 56/2006/ND-CP by the Government dated June 6th 2006 on sanctioning of administrative violations in cultural and information activities.
Decree No. 02/2011/ND-CP by the Government dated January 6th 2011 on sanctioning of administrative violations in press and publication activities.
2. Related Regulations
Law on Consumer Protection: (shall take effect since July 1st 2011 )
- Decree on detailing articles of the law: Drafting;- Decree on sanctioning of administrative violations:
Drafting; Other regulations:- Insurance;- Banking and finance;- Electricity;
- Others.
2. Unfair Competition Acts
Definitions: (Article 3.4 – Competition Law 2005):
“ Unfair competitive practices means competitive practices by an enterprise during the business which are contrary to general standards of business ethics and which cause or may cause damage to the interests of the State and/or to the legitimate rights and interests of other enterprises or of consumers”.
2. Unfair Competition Acts
Unfair Competition Acts (Article 39 – Competition Law):
1. Misleading indications;
2. Infringement upon business secrets;
3. Constraint in business;
4. Discrediting other enterprises;
5. Disturbing business activities of other enterprises;
2. Unfair Competition Acts
Unfair Competition Acts (Article 39 – Competition Law):
6. Advertising for the purpose of unfair competition;
7. Sale promotion for the purpose of unfair competition;
8. Discrimination by associations;
9. Illicit multi-level sale;
10. Other acts prescribed by the government.
2. Unfair Competition Acts - Fines
Decree No. 120-2005-ND-CP A fine of from 5 millions VND to 20 millions VND can be
imposed for breach of provisions on :- Misleading indications;- Infringement upon business secrets;- Constraint in business;- Discrediting other enterprises;- Disturbing for the purpose of unfair competition;
2. Unfair Competition Acts - Fines
A fine of from 15 millions VND to 50 millions VND can be imposed for breach of provisions on:
- Advertising for the purpose of unfair competition;- Sale promotion for the purpose of unfair competition;- Discrimination by associations; A fine of from 50 millions VND to 100 millions VND can
be imposed for breach of provision on illicit multi-level sale.
In addition to these fines, with differences for each breach, some other penalty or measures can be applied….
www.vca.gov.vn www.qlct.gov.vn
CONTENTS
1. VIETNAM COMPETITION AUTHORITY
2. REGULATIONS ON UNFAIR COMPETITON
3. CASES HANDLED BY VCA
3. Competition cases -2006
2006
8
1 12 2
00
2
4
6
8
10
Initative Investigation Decision
Unfair Competition Cases Restriction Competition Cases
3. Competition cases -2007
200714
5 53
10
0
5
10
15
Initative Investigation Decision
Unfair Competition Cases Restriction Competition Cases
3. Competition cases -2008
2008
1513 13
53
00
5
10
15
20
Initative Investigation Decision
Unfair Competition Cases Restriction Competition Cases
3. Competition cases -2009
200919
1412
7
31
0
5
10
15
20
Initative Investigation Decision
Unfair Competition Cases Restriction Competition Cases
3. Competition cases(2006-2009)
8
1 1
14
5 5
1513 13
19
1412
2 20
31 0
53
0
7
31
0
5
10
15
20
Ini Inv Deci Ini Inv Deci Ini Inv Deci Ini Inv Deci
2006 2007 2008 2009
Unfair Competition Cases Restriction Competition Cases
3. Cases on misleading indications
Complainant: Center A: Product: Wat-Clean
Investigated party: Company B: Product: Bitico
Violations: Misleading indications on
packing
3. Cases on misleading indications
Complainant: GlaxoSmithKline Product: Zinnat
Investigated party: Company B: Product: Zaniat
Violations: Misleading
indications on packing
3. Discrediting other enterprises
Investigated party: Saigon Petro.
Sector: Gas Violation: Sending leaflets to
customers to discredit other enterprises by incorrect information on price and quality of products.
3. Unfair Advertisements
Investigated party: Company A. Product: Functional foods (Vitamins) Violation: Providing false and
incorrect information on nature and use of products to customers.
3. Unfair Advertisements
HOW TO REGULATE
How to regulate effectively unfair competition practices in Vietnam:
1. Enhancing the capability of the implementing agencies;
2. More regulations: Detailing the definitions (General standards of business ethics)…;
3. Dealing with unfair competition issues in other sectors;
4. Co-operating with regulatory agencies and other domestic agencies;
5. Co-operating with international organizations and foreign competition agencies…
Cao Xuan Quang – Deputy Director of Unfair Competition Board