What are anti-competitive agreements? Regulations on anti-competitive agreements in Vietnam

What are anti-competitive agreements? Regulations on anti-competitive agreements in Vietnam (Internet image)

1. What are anti-competitive agreements?

Article 11 of the Competition Law 2018 stipulates anti-competitive agreements as follows:

- Agreements on directly or indirectly fixing goods or service prices.

- Agreements on distributing customers, consumption market, sources of supply of goods, provision of services.

- Agreements on limiting or controlling the quantity, volume of produced, purchased, sold goods or provided services.

- Agreements for one of more parties to the agreements to win tenders when participating in tenders for supply of goods or services.

- Agreements on preventing, restraining, disallowing other enterprises from entering the market or develop business.

- Agreements on abolishing from the market enterprises other than the parties to the agreements.

- Agreements on restricting technical or technological development and investments.

- Agreement on imposing on other enterprises conditions for signing of goods or services purchase or sale contracts or forcing other enterprises to accept obligations which have no direct connection with the subject of such contracts.

- Agreements on not trading with enterprises other than the parties to the agreements.

- Agreements on restricting consumption market, sources of supply of goods and services from enterprises other than the parties to the agreements.

- Other agreements that cause or may cause anti-competitive effects.

2. Case of prohibited anti-competitive agreements in Vietnam

According to Article 12 of the Competition Law 2018, the case of prohibited anti-competitive agreements include:

- Enterprises on the same relevant market are prohibited from entering anti-competitive agreements prescribed in Clauses 1, 2, and 3 Article 11 of the Competition Law 2018.

- Enterprises are prohibited from entering anti-competitive agreements prescribed in Clauses 4, 5 and 6 Article 11 of the Competition Law 2018.

- Enterprises on the same relevant market are prohibited from entering anti-competitive agreements prescribed in Clauses 7, 8, 9, 10 and 11 Article 11 of the Competition Law 2018 if such agreements cause or may cause substantial anti-competitive effects on the market.

- Enterprises doing business in different steps of the same production, distribution, supply chain for specific kinds of goods, services are prohibited from entering anti-competitive agreements prescribed in Clauses 1, 2, 3, 7, 8, 9, 10 and 11 Article 11 of the Competition Law 2018 if such agreements cause or may cause substantial anti-competitive effects on the market.

3. Exemption from prohibition on anti-competitive agreements in Vietnam

Article 14 of the Competition Law 2018 stipulates the exemption from prohibition on anti-competitive agreements as follows:

- Anti-competitive agreements prescribed in Clauses 1, 2, 3, 7, 8, 9, 10 and 11 Article 11 of the Competition Law 2018 which are prohibited in Article 12 of the Competition Law 2018 shall be granted exemption for a definite term if they meet one of the following conditions and benefit consumers:

+ Promoting technical and technological advances, raising the quality of goods, services;

+ Increasing the competitiveness of Vietnamese enterprises on international market;

+ Promoting the single application of quality standards and technical norms of product categories;

+ Agreeing on conditions for contract performance, goods delivery and payment, which are not related to prices and price elements.

- In cases where labor agreements, cooperation agreements in specific sectors or domains have been prescribed by other relevant laws, they shall be exempted in accordance with the provisions of this Law.

4. Application for exemption from prohibition on anti-competitive agreements

Article 15 of the Competition Law 2018 stipulates the application for exemption from prohibition on anti-competitive agreements as follows:

- Enterprises intending to enter into anti-competitive agreements shall submit an application for exemption for prohibited anti-competitive agreements (hereinafter referred to as exemption application) to the National Competition Commission.

- Required documents in exemption application:

+ An application form issued by the National Competition Commission;

+ Draft contents of the agreement reached by the parties;

+ A valid copy of the enterprise registration certificate or equivalent document of each enterprise participating in the anti-competitive agreement and a copy of the association's charter, for cases where an industry association participates in the agreement;

+ Financial statements of the two consecutive years preceding the year of submission of the exemption application or, in case of newly established enterprises, financial statements from the time of establishment to the time of submission of the exemption application of each enterprise participating in an anti-competitive agreement, which are certified by an auditing firm in accordance with the provisions of law;

+ A report explaining in detail the eligibility for exemption as specified in Clause 1 Article 14 of the Competition Law 2018, enclosed with evidence;

+ Letter(s) of authorization given to representatives by the parties to the anti-competitive agreement.

- The party submitting the application shall be responsible for the truthfulness of the application. Vietnamese translations are required if documents in the application are made in foreign language.

5. Acceptance of exemption application in Vietnam

Article 16 of the Competition Law 2018 stipulates the acceptance of exemption application as follows:

Step 1: The National Competition Commission shall be responsible for accepting exemption applications.

Step 2: Within 7 working days from receipt of an exemption application, the National Competitive Commission shall notify the applicant in writing that whether the application is complete and valid.

If the application is incomplete or invalid, the National Competition Commission shall notify the applicant in writing of deficiencies need amendments and allow them 30 days to make amendments from the date of notice.

Upon expiry of 30 days, if no amendment is made or the application is not amended completely, the National Competition Commission shall return the application.

Step 3: After receiving a notice certifying that the application is complete and valid, the applicant shall pay an amount of appraisal fee as prescribed in law on fees and charges.

Note: The application is accepted when the applicant fully pays the appraisal fee.

Ngoc Nhi

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