21 July 2017
THAILAND: Trade Competition Act Details Prohibited Practices and M&A Requirements
The incoming Trade Competition Act, effective as of 5 October, specifies a list of prohibited activities deemed unfair trade practices, while also establishing the Office of Trade Competition Commission (OTCC) as an independent regulatory body, free of its previous ties to The Commerce Ministry.
Among the practices specifically prohibited are any unfair intervention in / obstruction of the business operations of other operators and the use of superior market / bargaining power to fix the price level of goods and services. It will also be illegal to impose trade conditions designed to limit the ability of other operators to produce / trade in goods and services.
In a further change introduced in the new legislation, any mergers or acquisitions likely to create a monopoly will require prior approval from the OTCC. Similarly, the OTTC will need to be informed, within seven days, of any merger leading to a significant reduction of the level of competition in any given market.
In terms of the OTCC’s new autonomous status, this is expected to minimise political / commercial interference in any bid to counter unfair trade practices. In line with this, the Commission will also have the authority to impose administrative fines on any businesses seen to be in breach of the new law and to direct any such business to cease or modify any prohibited conduct.