Prohibited abuse of a dominant position or abuse of a monopoly position in Vietnam

Prohibited abuse of a dominant position or abuse of a monopoly position in Vietnam (Internet image)

Regarding this issue, LawNet answers as follows:

1. Prohibited abuse of a dominant position or abuse of a monopoly position in Vietnam 

Prohibited abuse of a dominant position or abuse of a monopoly position according to Article 27 of the Competition Law 2018 as follows:

- An enterprise or group of enterprises holding a dominant position on the market is prohibited from:

+ Selling goods or providing services below costs that drives or probably drives competitors out of the market;

+ Imposing irrational buying or selling prices of goods or services or establishing minimum resale price maintenance (RPM), which causes or possibly causes damage to customers;

+ Restricting production and distribution of goods, services, limiting markets, preventing technical and technological development, which causes or possibly causes damage to customers;

+ Applying dissimilar commercial conditions in similar transactions, which leads to or possibly leads to prevention of other enterprises from market entry or expansion or exclusion of other enterprises;

+ Imposing conditions on other enterprises to conclude goods or services purchase or sale contracts or requesting customers to accept obligations which have no direct connection with subjects of such contracts, which leads to or possibly leads to prevention of other enterprises from market entry/expansion or exclusion of other enterprises;

+ Preventing other enterprises from market entry or expansion;

+ Other prohibited abuse of a dominant position prescribed in other laws.

- An enterprise holding a monopoly position is prohibited from:

+ Performing acts prescribed in Points b, c, d, dd and e Clause 1 Article 27 of the Competition Law 2018;

+ Imposing unfavorable conditions on customers;

+ Taking advantage of the monopoly position to unilaterally modify or cancel the contract already signed without justifiable reasons;

+ Other prohibited abuse of a monopoly position prescribed in other laws.

2. Regulations on enterprises, groups of enterprises holding a dominant position on the market in Vietnam

Regulations on enterprises, groups of enterprises holding a dominant position on the market according to Article 24 of the Competition Law 2018 are as follows:

- An enterprise shall be considered to hold a dominant position on the market if it has substantial market power as specified in Article 26 of the Competition Law 2018 or has market shares of 30% or more on the relevant market.

- A group of enterprises shall be considered to hold a dominant position on the market if they jointly cause anti-competitive effects and have substantial market power as specified in Article 26 of the Competition Law 2018 or their total market shares fall into one of the following cases:

+ Two enterprises having the total market share of 50% or more on the relevant market;

+ Three enterprises having the total market share of 65% or more on the relevant market;

+ Four enterprises having the total market share of 75% or more on the relevant market;

+ At least five enterprises having the total market share of 85% or more on the relevant market.

- A group of enterprises holding a dominant market position prescribed in Clause 2 of Article 24 of the Competition Law 2018 excludes an enterprise holding market share of less than 10% of the relevant market.

3. Determination of substantial market power in Vietnam

According to Clause 1, Article 26 of the Competition Law 2018, substantial market power of an enterprise or group of enterprises is determined based on some of the following factors:

- Market shares of enterprises on the relevant market;

- Financial strength and size of the enterprise;

- Barriers to market entry and expansion to other enterprises;

- Ability to obtain, assess, control the goods distribution/consumption market or sources of supply;

- Advantages in technology and technical infrastructure;

- Right to own, obtain and assess infrastructure;

- Right to own or use subject matters of intellectual property;

- Ability to transfer to other sources of supply or demand associated with other goods and related services;

- Particular factors in the sector that the enterprise runs the business.

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