Professor Mark Williams is associate head of the school of accounting and finance and a professor of law at Polytechnic University. Here, he explains the importance of competition law and how it is applied in Asia.
What is competition law and why is it important?
A competition law is part of an overall public policy stance in favour of enhancing rivalry between providers of goods and services in a market, promoting economic efficiency and the welfare of consumers by providing more choice at less cost. The importance of a competition law is that it provides a mechanism to promote pro-competitive ends, prohibit anticompetitive activities and punish firms that engage in anticompetitive activities that ultimately injure consumer welfare. However, competition law is not a tool primarily to protect inefficient market players or to directly affect prices or quantities or the quality of goods or services offered by firms - the idea is for the market to supply consumer demand effectively and to prevent firms manipulating the market to unjustifiably enrich themselves at the expense of exploited consumers.
Has economic globalisation made the formulation and application of competition law more difficult across Asia?
Globalisation has, in fact, strengthened the case for appropriate and effective laws across Asia. The most problematic political issue is for an individual country and its government to be convinced that market forces can best provide the goods and services that consumers require within a framework of transparent and predictable rules provided by a pro-competition law. There are many international examples from which Asian countries have drawn inspiration for formulating their own statutes. Some have modelled their law on the United States anti-trust system, some on the European Union and others have taken a hybrid approach, but now almost all East Asian countries have a competition law of some sort and many are more actively enforcing them.
Can the principle of free and fair competition exist without the practice of free and fair access to information?