lunes, 2 de abril de 2012

Prohibited Agreements and Concerted Practices.

Broadly, Law No. 42-08, on Competition Defense, defines Agreement as: “A) any exchange of will expressed through a contract or agreement, whether explicit or tacit, written or oral, which is likely to align competitive behavior of economic agents.” (Article 4a). Collective bargaining agreements covered by the Labor Code of the Dominican Republic are excluded from this regime. (Art. 3Párrafo).

Similarly, Concerted Practices are defined as: "Any factual behavior between competing economic agents voluntarily directed to eliminate competition."

When such agreements and concerted practices "produce or could produce the effect of imposing unjustified barriers to market" the law considers them anti-competitive, and therefore are susceptible to investigation. In our opinion, although the wording of the law is lax, there necessarily must meet proof or at least prima facie evidence of the existence of some forms of prohibited agreement or concerted practices, as listed in its Article 5. In compliance with the principle of typification or characterization, at least one of the following allegations should prompt a complaint, and consequently, the opening of an investigation for entering into anticompetitive agreements or concerted practices:

a) Price fixing, discounts, special charges, other conditions of sale and exchange of information with the same object or effect;

b) Arrange or coordinate bid riggings;

c) To divide, distribute or assign segments or parts of a market for goods and services, determining specified time or space, suppliers and customers;

d) To limit production, distribution or marketing of goods, or provision and / or frequency of services, regardless of their nature and,

e) To eliminate competitors from the market or impose barriers to entry, from the position of buyers or sellers of particular products.

In future newsletters we will analyze the contents of each of these anti-competitive types of prohibited agreements and concerted practices.

Angélica Noboa Pagán

March 26, 2012.

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