Enlightened competition legislation gives businesses a fair and level playing field.
Key Prohibitions
The three main prohibited activities under the Competition Act are:
- Agreements, decisions and practices which prevent, restrict or distort competition ("the Section 34 prohibition")
- Abuse of dominant position ("the Section 47 prohibition")
- Mergers and acquisitions that substantially lessen competition ("the Section 54 prohibition")
In general, anti-competitive activities are likely to result in higher prices, lower quality, and/or less choices of products and services for consumers.
Section 34 – Anti-Competitive Agreements
Section 34 prohibits agreements between undertakings; decisions of associations of undertakings; and concerted practices, which have as their object or effect the appreciable prevention, restriction or distortion of competition within Singapore, unless they are excluded or exempted.
Section 47 – Prohibition on Abuse of a Dominant Position
Section 47 prohibits commercial conduct on the part of one or more undertakings which amounts to the abuse of a dominant position in any market in Singapore.
There is a two-step test to assess whether the section 47 prohibition applies:
- Whether the undertaking is dominant in a relevant market, either in Singapore or elsewhere;
- If it is, whether it is abusing that dominant position in a market in Singapore.
Section 54 – Mergers that Substantially Lessen Competition
Section 54 prohibits mergers that may have resulted or may be expected to result in a substantial lessening of competition, unless they are excluded or exempted. Apart from such mergers, complaints can also be lodged against anticipated mergers which, if carried into effect, will infringe the section 54 prohibition.