How to determine an enterprise's share of a relevant market in Vietnam? How to determine market share of affiliated companies in Vietnam?
What are the principles of determination of an enterprise's share of a relevant market in Vietnam?
Pursuant to Article 9 of Decree No. 35/2020/ND-CP stipulating the principles of determination of an enterprise's share of a relevant market as follows:
- An enterprise’s share of a relevant market shall be determined according to methods specified in Article 10 in the 2018 Competition Law in Vietnam.
- While identifying market share, National Competition Commission may consult with business sector or industry administrations, endorsed enterprises, qualified entities and persons.
How to determine an enterprise's share of a relevant market in Vietnam? How to determine market share of affiliated companies in Vietnam? (Image from the Internet)
How to determine market share of affiliated companies in Vietnam?
Pursuant to Article 10 of Decree No. 35/2020/ND-CP on determination of market share of affiliated companies as follows:
- Sales and purchase volume, and quantity of units of a particular product and service sold or purchased of affiliated companies, shall be determined as follows:
+ Sales and purchase volume, and quantity of units of a particular product and service sold or purchased, which are meant for determination of market share of a group of affiliated companies, shall be calculated by the summation of all of these measurements of all enterprises belonging to this group;
+ Sales and purchase volume, and quantity of units of a particular product and service sold or purchased of a group of affiliated companies shall exclude sales and purchase volume, and quantity of units of a particular product and service sold or purchased which arise from sale of products and supply of services amongst this group's member companies.
- Market share of affiliated companies in the group shall be defined as the market share of the entire group.
How to determine an enterprise's share of a relevant market in Vietnam?
Pursuant to Clause 1, Article 10 of the 2018 Competition Law in Vietnam:
Determination of market share and combined market share
1. Based on characteristics and nature of the relevant market, the market share of enterprises on the relevant market shall be determined using one of the following methods:
a) The percentage of sales revenue of an enterprise out of the total sales revenue of all enterprises on the relevant market on a monthly, quarterly or yearly basis;
b) The percentage of purchase revenue of an enterprise out of the total purchase revenue of all enterprises on the relevant market on a monthly, quarterly or yearly basis;
c) The percentage of volume of product/service sold by an enterprise out of the total volume of products/services sold by all enterprises on the relevant market on a monthly, quarterly or yearly basis;
d) The percentage of volume of product/service purchased by an enterprise out of the total volume of product /service purchased by all enterprises on the relevant market on a monthly, quarterly or yearly basis.
2. Combined market share is total market shares on relevant market of enterprises engaging anti-competitive practices or economic concentration.
3. The revenue used to determine market share prescribed in Clause 1 hereof shall be defined by Vietnam’s accounting standards.
4. In case where an enterprise operates for less than one financial year, the revenue, sales, volume of goods and services sold/purchased used to determine the market share prescribed in Clause 1 hereof shall be calculated from the date of commencing its operations till the date of determining its market share.
5. The Government shall provide guidelines for this Article.
Thus, according to the above regulations, based on characteristics and nature of the relevant market, the market share of enterprises on the relevant market shall be determined using one of the following methods:
- The percentage of sales revenue of an enterprise out of the total sales revenue of all enterprises on the relevant market on a monthly, quarterly or yearly basis;
- The percentage of purchase revenue of an enterprise out of the total purchase revenue of all enterprises on the relevant market on a monthly, quarterly or yearly basis;
- The percentage of volume of product/service sold by an enterprise out of the total volume of products/services sold by all enterprises on the relevant market on a monthly, quarterly or yearly basis;
- The percentage of volume of product/service purchased by an enterprise out of the total volume of product /service purchased by all enterprises on the relevant market on a monthly, quarterly or yearly basis.
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