Singapore: Competition Commission of Singapore

At the Competition Commission of Singapore (CCS), we see ourselves as part of a larger ecosystem growing a vibrant economy with competitive markets and innovative businesses. We achieve this through robust enforcement, strong internal and external advocacy, and building relationships in the region and internally.

Enforcement

Enforcement remains one of the CCS’s priorities in 2014. Having adopted a policy of an extremely open economy, the CCS needs to be vigilant against anti-competitive cross-border conduct that could negatively impact Singapore businesses and consumers. In this regard, international cartels remained a key focus for 2014. In May 2014, the CCS issued an infringement decision against a ball bearing international cartel for engaging in anti-competitive agreements and unlawful exchange of information, the first international cartel case, with financial penalties amounting to over S$9 million, the largest penalty the CCS has imposed thus far. Subsequently, in December 2014, the CCS issued an infringement decision against 11 freight companies and their Singapore subsidiaries and affiliates, with penalties amounting to over S$7 million. The growing number of cross-border competition cases highlights the importance of cooperation among competition agencies and this is one aspect we hope to work on moving forward.

On the merger front, 2014 has been an active year. To date, we have received 10 merger filings under our voluntary self-­assessment regime, the highest number in a single calendar year since the merger regime came into force in 2007. Six have been completed, with an additional four being assessed. In November 2014, the CCS published a conditional clearance decision in relation to the proposed acquisition of Jobstreet Singapore by Seek Asia Investments Pte Ltd, marking the first time that the CCS has accepted both behavioural and structural commitments to address competition concerns arising from a merger. This decision demonstrated the importance of industry feedback, which resulted in the CCS balancing the parties’ desire for the merger to proceed with commitments from them to preserve competition, choice and innovation in the related market. Earlier in the year, the CCS initiated a Phase II merger review of the proposed acquisition of Singapore Cruise Centre Pte Ltd by SATS Airport Services Pte Ltd and SATS-Creuers Cruise Services Pte Ltd in view of competition concerns raised by the two-to-one merger. The parties subsequently withdrew their application. At the time of writing, we are working on several merger filings pertaining to the aviation sector, a sector that has seen an increasing number of alliances in Asia.

One of the foundations of a good competition regime is due process and transparency. The CCS has a set of measures in place for safeguarding due process and transparency. These include:

• access to file by parties served with provisional infringement decisions and the ability to make written and oral representations;
• the right to appeal to an independently constituted Competition Appeal Board on a full merits basis; and
• the publication of guidelines and decisions.

To further strengthen the CCS’s enforcement toolkit and to allow more effective administration of the Competition Act, the CCS has an ongoing legislative review to ensure its guidelines and legislations are up-to-date and in line with international practices. Another initiative that the CCS has embarked on to strengthen its enforcement toolkit is to work on detection mechanisms. As such, a cross-divisional unit has been set up to:

• collect data;
• detect cartels and other anti-competitive behaviour; and
• collect intelligence.

The purpose is to ensure the efficient use of resources and a more targeted detection of anti-competitive activities.

Advocacy

Apart from enforcement, competition advocacy is equally important for promoting a pro-competition culture. For 2014, we focused on advocacy within government. The Policy and Markets Division was formed to step up engagement with government agencies to ensure that government policies take into consideration the competition impact of these policies on markets. To ensure the relevance of the CCS’s decisions in the rapidly changing and increasingly complex business environment, the CCS has enhanced its research capabilities and developed institutional knowledge on evolving and new markets. The Policy and Markets Division also conducts market studies and surveillance, and collaborates with academic and research institutions and think tanks on suitable areas of research on competition policy, economics or law. Earlier this year, the CCS entered into a collaboration with the National University of Singapore Centre for Law and Business to co-sponsor a fellowship to encourage more research on competition issues in Singapore and within the region to promote a greater awareness of competition policy and law issues, and build Singapore’s profile as a leader in research on competition policy and law.

Compliance and awareness

Successful compliance programmes help minimise potential infringements of the Competition Act by businesses, and enables them to take appropriate remedial action. That said, the CCS recognises that measuring effectiveness is not easy as effective compliance comes from what undertakings avoid, as they are aware of its illegality. However, we have noted an upward trend in the number of businesses with a keen interest in competition compliance programmes, and we have received many requests at the CCS to share our views on compliance matters.

To help us better gauge the awareness and perception levels on competition law in Singapore, the CCS conducts a bi-annual survey on various groups of stakeholders. The 2014 survey results were very encouraging and showed that the CCS’s outreach activities have borne fruits as general awareness levels have increased, especially among the businesses. Businesses and practitioners also perceive the quality of the CCS’s enforcement to have improved. The CCS will use the results of this survey to continue to sharpen its communication and outreach methods in order to help stakeholders understand the CCS’s decisions and foster a deeper appreciation of the benefits of competition policy and law.

International and regional front

The CCS plays an active role in free trade agreements (FTAs), particularly in the negotiation of competition chapters in various proposed FTAs. In 2014, we were involved in the negotiation of the Turkey–Singapore FTA and the Regional Comprehensive Economic Partnership (RCEP), a trade agreement involving all 10 ASEAN member states and six of ASEAN’s dialogue partners: Australia, China, India, Japan, New Zealand and South Korea. As chair of the competition chapter in the RCEP, the CCS aims to achieve a high standard competition chapter that will benefit all RCEP partners and facilitate regional economic integration. Notwithstanding differences in the legal framework among countries, we feel that the core principles of competition, transparency and fairness will eventually benefit all parties.

We will continue to be active in the various international competition forums, and we are excited to share that the CCS has been selected to be the host for the ICN Annual Conference 2016. In 2015, we will also be partnering OECD to host a joint competition workshop on the topic of advocacy.

As the regional economy becomes more interconnected through the formation of the ASEAN Economic Community in 2015, the CCS sees the importance of strengthening competition cooperation and working towards a coherent and effective regional competition architecture. In this regard, the ASEAN Experts Group on Competition (AEGC) will continue to facilitate the establishment of the ASEAN Economic Community (AEC), which will see the formation of a single market and production base in 2015. The AEGC has undertaken several initiatives over the years to build up capabilities of competition authorities in the region and to encourage greater cooperation and integration in the area of competition policy and law. One such initiative introduced in 2014 was the Competition Law Implementation Program which will see Australia and New Zealand partner with ASEAN to develop and put in place multiple projects to further the institutional capacities and expertise of competition-related authorities in ASEAN. The CCS also contributes to the region’s development by sharing its experiences at various AEGC training events, including organising a workshop on competition compliance in 2014, as well as hosting staff attachments from the Malaysia Competition Commission and the Vietnam Competition Authority to train up local competition expertise.

Conclusion

The CCS will be celebrating its 10th Anniversary in 2015. We will continue to ensure healthy competitive markets for the benefit of the Singapore economy by stemming out anti-competitive behaviour and any other business practices that undermine the competitive process. As part of efforts in the organisation to chart our direction for the next 10 years and beyond, we have embarked on a comprehensive review of our goals. The CCS will place emphasis on not simply championing competition for competition’s sake, but on making markets work better well to create opportunities and choices for businesses and consumers in Singapore.