Philippine Competition Act – (RA No.

other means, for the purpose of

10667) obtaining control by:
(1) One (1) entity of the whole or part of
Definition another;
●​ An act providing for a national (2) Two (2) or more entities over
competition policy prohibiting another; or
anti-competitive agreements, (3) One (1) or more entities over one (1)
abuse of dominant position and or more entities;
anti-competitive mergers and
acquisitions, establishing the (b) Agreement refers to any type or form
Philippine competition of contract, arrangement,
commission and appropriating understanding, collective
funds therefore. recommendation, or concerted action,
whether formal or informal, explicit or
Scope and Application – (Sec. 3) tacit, written or oral;
●​ This Act shall be enforceable
against any person or entity (c) Conduct refers to any type or form of
engaged in any trade, industry undertaking, collective
and commerce in the Republic of recommendation, independent or
the Philippines. It shall likewise concerted action or practice, whether
be applicable to international formal or informal;
trade having direct, substantial,
and reasonably foreseeable (d) Commission refers to the Philippine
effects in trade, industry, or Competition Commission created under
commerce in the Republic of the this Act;
Philippines, including those that
result from acts done outside the (e) Confidential business information
Republic of the Philippines. This refers to information which concerns or
Act shall not apply to the relates to the operations, production,
combinations or activities of sales, shipments, purchases, transfers,
workers or employees nor to identification of customers, inventories,
agreements or arrangements or amount or source of any income,
with their employers when such profits, losses, expenditures;
combinations, activities,
agreements, or arrangements are (f) Control refers to the ability to
designed solely to facilitate substantially influence or direct the
collective bargaining in respect of actions or decisions of an entity,
conditions of employment. whether by contract, agency or
otherwise;
Definition of Terms – (Sec. 4)
●​ As used in this Act: (g) Dominant position refers to a
(a) Acquisition refers to the purchase of position of economic strength that an
securities or assets, through contract or entity or entities hold which makes it
capable of controlling the relevant concerned is involved in the supply and
market independently from any or a demand of goods and services, in which
combination of the following: the conditions of competition are
competitors, customers, suppliers, or sufficiently homogenous and which can
consumers; be distinguished from neighboring
(h) Entity refers to any person, natural areas because the conditions of
or juridical, sole proprietorship, competition are different in those areas.
partnership, combination or association
in any form, whether incorporated or Prohibited Agreements
not, domestic or foreign, including Anti-Competitive Agreements – (Sec.
those owned or controlled by the 14)
government, engaged directly or (a) The following agreements, between
indirectly in any economic activity; or among competitors, are per se
prohibited:
(i) Market refers to the group of goods (1) Restricting competition as to price,
or services that are sufficiently or components thereof, or other terms
interchangeable or substitutable and of trade;
the object of competition, and the (2) Fixing price at an auction or in any
geographic area where said goods or form of bidding including cover bidding,
services are offered; bid suppression, bid rotation and
market allocation and other analogous
(j) Merger refers to the joining of two (2) practices of bid manipulation;
or more entities into an existing entity
or to form a new entity; Bid manipulation:
Bid rotation:Companies take turns
(k) Relevant market refers to the market being the winning bidder
in which a particular good or service is
sold and which is a combination of the Bid suppression: companies remove
relevant product market and the themselves from the bidding entirely
relevant geographic market, defined as
follows: (b) The following agreements, between
or among competitors which have the
(1) A relevant product market object or effect of substantially
comprises all those goods and/or preventing, restricting or lessening
services which are regarded as competition shall be prohibited:
interchangeable or substitutable by the (1) Setting, limiting, or controlling
consumer or the customer, by reason of production, markets, technical
the goods and/or services’ development, or investment;
characteristics, their prices and their (2) Dividing or sharing the market,
intended use; and whether by volume of sales or
purchases, territory, type of goods or
(2) The relevant geographic market services, buyers or sellers or any other
comprises the area in which the entity means;
(c) Agreements other than those (b) Imposing barriers to entry or
specified in (a) and (b) of this section committing acts that prevent
which have the object or effect of competitors from growing within the
substantially preventing, restricting or market in an anti-competitive manner
lessening competition shall also be except those that develop in the market
prohibited: Provided, Those which as a result of or arising from a superior
contribute to improving the production product or process, business acumen,
or distribution of goods and services or or legal rights or laws;
to promoting technical or economic
progress, while allowing consumers a (c) Making a transaction subject to
fair share of the resulting benefits, may acceptance by the other parties of other
not necessarily be deemed a violation of obligations which, by their nature or
this Act. according to commercial usage, have no
An entity that controls, is controlled by, connection with the transaction;
or is under common control with
another entity or entities, have common (d) Setting prices or other terms or
economic interests, and are not conditions that discriminate
otherwise able to decide or act unreasonably between customers or
independently of each other, shall not sellers of the same goods or services,
be considered competitors for purposes where such customers or sellers are
of this section. contemporaneously trading on similar
terms and conditions, where the effect
Abuse of Dominant Position – (Sec. may be to lessen competition
15) substantially: Provided, That the
●​ It shall be prohibited for one or following shall be considered
more entities to abuse their permissible price differentials:
dominant position by engaging in (1) Socialized pricing for the less
conduct that would substantially fortunate sector of the economy;
prevent, restrict or lessen (2) Price differential which reasonably
competition: or approximately reflect differences in
the cost of manufacture, sale, or
(a) Selling goods or services below cost delivery resulting from differing
with the object of driving competition methods, technical conditions, or
out of the relevant market: Provided, quantities in which the goods or
That in the Commission’s evaluation of services are sold or delivered to the
this fact, it shall consider whether the buyers or sellers;
entity or entities have no such object (3) Price differential or terms of sale
and the price established was in good offered in response to the competitive
faith to meet or compete with the lower price of payments, services or changes
price of a competitor in the same in the facilities furnished by a
market selling the same or comparable competitor; and
product or service of like quality;
(4) Price changes in response to (h) Directly or indirectly imposing
changing market conditions, unfair purchase or selling price on their
marketability of goods or services, or competitors, customers, suppliers or
volume; consumers, provided that prices that
develop in the market as a result of or
(e) Imposing restrictions on the lease or due to a superior product or process,
contract for sale or trade of goods or business acumen or legal rights or laws
services concerning where, to whom, or shall not be considered unfair prices;
in what forms goods or services may be and
sold or traded, such as fixing prices,
giving preferential discounts or rebate (i) Limiting production, markets or
upon such price, or imposing technical development to the prejudice
conditions not to deal with competing of consumers, provided that limitations
entities, where the object or effect of the that develop in the market as a result of
restrictions is to prevent, restrict or or due to a superior product or process,
lessen competition substantially: business acumen or legal rights or laws
Provided, That nothing contained in shall not be a violation of this Act:
this Act shall prohibit or render
unlawful: Provided, That nothing in this Act shall
(1) Permissible franchising, licensing, be construed or interpreted as a
exclusive merchandising or exclusive prohibition on having a dominant
distributorship agreements such as position in a relevant market or on
those which give each party the right to acquiring, maintaining and increasing
unilaterally terminate the agreement; or market share through legitimate means
(2) Agreements protecting intellectual that do not substantially prevent,
property rights, confidential restrict or lessen competition:
information, or trade secrets;
Provided, further, That any conduct
(f) Making supply of particular goods or which contributes to improving
services dependent upon the purchase production or distribution of goods or
of other goods or services from the services within the relevant market, or
supplier which have no direct promoting technical and economic
connection with the main goods or progress while allowing consumers a
services to be supplied; fair share of the resulting benefit may
not necessarily be considered an abuse
(g) Directly or indirectly imposing of dominant position:
unfairly low purchase prices for the
goods or services of, among others, Provided, finally, That the foregoing
marginalized agricultural producers, shall not constrain the Commission or
fisherfolk, micro-, small-, medium-scale the relevant regulator from pursuing
enterprises, and other marginalized measures that would promote fair
service providers and producers; competition or more competition as
provided in this Act.
 through such means without violating
Prohibited Mergers and Acquisitions the provisions of this Act:
– (Sec. 20)
●​ Merger or acquisition agreements Provided, further, That the acquisition
that substantially prevent, of the stock or other share capital of
restrict or lessen competition in one or more corporations solely for
the relevant market or in the investment and not used for voting or
market for goods or services as exercising control and not to otherwise
may be determined by the bring about, or attempt to bring about
Commission shall be prohibited. the prevention, restriction, or lessening
of competition in the relevant market
Exceptions – (Sec. 21) shall not be prohibited.
●​ Merger or acquisition agreement
prohibited under Section 20 of Covered Transactions – PCC
this Chapter may, nonetheless, Memorandum Circular No. 02-2020
be exempt from prohibition by i. Size of Person Test
the Commission when the -​ exceeds Five Billion Six Hundred
parties establish either of the Million Pesos (Php
following: 5,600,000,000.00)
ii. Size of Transaction Test
(a) The concentration has brought -​ exceeds Two Billion Two
about or is likely to bring about gains Hundred Million Pesos (Php
in efficiencies that are greater than the 2,200,000,000.00)
effects of any limitation on competition
that result or likely to result from the
merger or acquisition agreement; or
(b) A party to the merger or acquisition
agreement is faced with actual or
imminent financial failure, and the
agreement represents the least
anti-competitive arrangement among
the known alternative uses for the
failing entity’s assets:
Provided, That an entity shall not be
prohibited from continuing to own and
hold the stock or other share capital or
assets of another corporation which it
acquired prior to the approval of this
Act or acquiring or maintaining its
market share in a relevant market