Competition Law 2018: Clarifying criteria to identify businesses that dominate the market


The Competition Law 2018 will take effect from July 1, 2019, including a change in the criteria to identify businesses that dominate the market.

Compared to the 2004 Competition Law, currently, the Competition Law 2018 (effective from July 1, 2019) has added tools to determine the market dominance of enterprises. Specifically, in addition to market factors, there is also a market power factor.

Enterprises are considered to have a dominant market position if they have significant market power or have a market share of 30% or more in the relevant market. The significant market power of an enterprise is determined based on a number of the following factors: the correlation of market share among enterprises in the relevant market; financial strength and size of the enterprise; barriers to market entry and expansion for other businesses; ability to hold, access and control the distribution and consumption markets of goods and services or the supply of goods and services; advantages in technology and technical infrastructure; right to own, hold, and access infrastructure; ownership, right to use objects of intellectual property rights; ability to switch to supply or demand for other related goods or services; specific factors in the industry or sector in which the business is operating.

Market share of 30% or more on the relevant market, in which the relevant market is a market of products and services that can be substituted for each other in terms of characteristics, purposes and prices in the region. Specific geographies have similar competitive conditions and differ significantly from neighboring geographic areas.

Relevant markets are determined on the basis of the relevant product market and the relevant geographic market. In particular, the market of related products is the market of goods and services that can be substituted for each other in terms of characteristics, purposes and prices.

The determination of product interchangeability reflects the level of competition of enterprises as competitors, because when they can be substituted for each other, then those products have The common purpose is to meet a market need.

Relevant geographical market is a specific geographical area in which goods and services are provided that can be substituted for each other with similar competitive conditions and significantly different from other regions. Geography nearby.

An unfair competition enterprise will be fined up to 2 billion VND.

Also in the Competition Law 2018, one of the new points of this Law is to specify the maximum level of penalties for enterprises that violate the competition regulations in Article 111. Enterprises that unfairly compete will be fined. 2 billion.

Specifically, violations of unfair competition: maximum fine of VND 2 billion; violating regulations on economic concentration: fining up to 5% of the total turnover of violating enterprises on the relevant market in the fiscal year preceding the year of violation; Violation of regulations on agreements on restraint of competition, abuse of dominant market position, abuse of monopoly position: fining up to 10% of the total turnover of an enterprise committing violations on the relevant market in fiscal year preceding the year of committing the violation; Other violations: maximum fine of VND 200 million.

Saigon Businessman
* Source: Saigon Businessman

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