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Trade Competition Act 2017:
New Hope For Thailand?
Dr Nisit Intamano
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Thailand’s new Trade Competition Act (TCA) 2017: Introduction
Approved by the Cabinet in October 2016, and the
National Legislative Assembly on March, 2017
Published on July 7th, 2017 and will become effective on
October 5th, 2017 (90 days from its publication in the
government gazette)
The 2017 will repeal and replace the first competition law
in Thailand, the Trade Competition Act 1999
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Thailand’s new Trade Competition Act (TCA) 2017: Key Changes
Expected to increase enforcement as it establishes the
Trade Competition Commission as a separate entity
dependent of the government, with its own budget
State enterprises will be exempted only in limited
circumstances
Under Jurisdiction of the Central Intellectual Property and
International Trade Court and the Administrative Court
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Section 4: Scope of Application
Exemption:
1. Central administration, provincial and local administration
2. State enterprises and public organizations for actions pursuant to law
or Cabinet Resolutions as required for national security, public interest,
common interest or to provide public utilities
3. Farmers’ groups, agricultural co-operatives
4. Businesses which are specifically regulated by other specific laws on
trade competition (e.g. under the Telecommunications Business
Operations Act 2001)
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Key Provisions
Prevention of Monopoly/Restriction
of Competition
Abuse of Market Power
Merger of Business
Collusion
Prevention of Unfair Trade Practices
Practices which are not free and fair competition
Prevention of Agreement with Business Operator in
a Foreign Country
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Abuse of Dominant Position in a Market S. 50, Trade Competition Act 2017
An abuse of dominance occurs when the dominant player is
acting in any of the following manners:
1. Unfairly fixing or maintaining purchasing or selling price of
goods and services;
2. Unfairly fixing conditions requiring other business operators
who are his or her trading partners to restrict service, production,
purchase or distribution of goods or restrict opportunities in
purchasing or selling goods, receiving or providing services or
obtaining credits from other business operators;
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Abuse of Dominant Position in a Market S. 50, Trade Competition Act 2017
3. Suspending, reducing, or restricting services, production,
purchase, distribution, deliveries or importation without
justifiable reasons, or destroying or causing damage to
goods in order to reduce the quantity to be lower than the
market demand;
4. Intervening in the operation of business
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Merger of Business: S. 51-53, Trade Competition Act 2017
Under the TCA 2017, there are both pre-merger
approval and post-notification requirements:
Pre-merger approval: prior approval from the Trade
Competition Commission (TCC) is required for any
merger that may result in a monopoly or is with a
business operator having market dominance
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Merger of Business: S. 51-53, Trade Competition Act 2017
Post-notification: the TCC also incorporates the
mechanism of post-notification for the business
operators who have merged their business in a
manner which may cause a significant reduction of
competition in the market in accordance with criteria
to be prescribed by the TCC
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Merger of Business: S. 51-53, Trade Competition Act 2017
Exception: the pre-merger approval and post-
notification requirements do not apply to any merger
for the purpose of internal restructuring between the
business operators who are related by policy or
control power according to the criteria set by the TCC
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Anti-Competitive Agreements (Cartels): S. 54-56, 58, Trade Competition Act 2017
The 2017 Act makes a distinction between cartels
between competitors in the same market leading to
price fixing, market allocation, output control or bid
rigging (S.54), which are considered “hardcore
cartels”, and cartels between other operators or “non-
hardcore cartels” (S.55)
Hardcore cartels are subject to criminal penalties,
while the non-hardcore cartels are subject to
administrative fines
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Agreement Between Competitors (Section 54)
1. Fixing purchasing or selling price, or commercial
conditions
2. Limiting quantity of good or services
3. Bid-rigging
4. Fixing geographical sale and purchase areas
Excludes: Affiliated companies
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Agreement with Other Business Operators (Section 55 )
1. Actions in Section 54 (1), (2) and (4) where the business
operators are not competitors in same market
2. Reducing quality of goods or services
3. Appoint or entrust any person as a sole distributor
4. Fixing conditions for buying or selling goods or services
5. Others as prescribed by notifications
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Agreement with Other Business Operators (Section 56)
Excludes:
Affiliated companies
R&D agreement
Licensing agreement
Specific forms of business as prescribed in the
Ministerial Regulation
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Practices which are not free and fair competition (Section 57)
A business operator shall not carry out any act which causes damage to
other business operators in the following manners:
(1) Unfairly restricting the business operation of other business operators
(2) Unfairly exercising the superior market power or bargaining power
(3) Unfairly fixing commercial condition which restricts or impedes the
business operation of other persons
(4) Other acts as notified by the Commission
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Agreement with Business Operator in a Foreign Country (Section 58)
Any juristic act or contract which result on monopoly
or unfair restriction of trade without justifiable
reasons, and has a severe impact on the economy
and the consumers’ interest
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Consequences of Breach Civil Claim and Criminal Penalties
Previously, no breach of the 1999 Act ever proceeded to the
Criminal Court.
Civil claim and criminal penalties are stipulated in the current law
The administrative penalties are now introduced in the TCA
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Consequences of Breach Civil Claim and Criminal Penalties (Section 59)
In order to minimize risks of violation of trade competition
provision, a business operator may file a petition to the
Commission to consider passing a decision in advance on
whether a particular act of such business operator is in violation
of Section 50, 54, 55, 57, or 58 of the 2017 Act
In passing a decision on the petition, the Commission may set
any conditions for compliance by the business operator so that it
be in conformity with the 2017 Act. A decision of the Commission
shall have binding effect only on the petitioner and within the
scope and period of time prescribed by the Commission.
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Offence Criminal Penalty Administrative Penalty
• Abuse of Market Dominance (S.50) Fine: ≤ 10% of revenue in
the year of offence and/or
Imprisonment: ≤ 2 years
First year: Fine: ≤ 1M THB
and/or
Imprisonment ≤2 years
• Agreement Between Competitors
(S.54)
• Merger of Business (S.51) (Notification) Fine: ≤ 200,000,
Daily ≤ 10,000 THB
(Permission) Fine: 0.5% of
value of merger transaction
• Collusive Business Practices (S.55)
• Unfair Practice (S.57)
• Agreement with Business Operator in a
Foreign Country (S.58)
Fine: ≤ 10% of revenue in the
year of offence
First year: Fine: ≤ 1M THB
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