FTAA Negotiating Groups - Canadian Proposals
November 2000
CANADA'S PROPOSALS THE FTAA NEGOTIATING GROUP ON COMPETITION POLICY
Item 1 Scope of the Negotiations on Competition Policy
Objective: To ensure that the benefits of the FTAA liberalization process are not undermined by anti-competitive business practices.
The delegations shall examine whether or not it would be advisable to define the term "anti-competitive."
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1.1
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Commitments to have, implement and enforce competition policy and measures which will promote competitive markets in the FTAA, both among countries in the Hemisphere and internally in each of those countries.
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The term "measures" is intended to cover laws, rules, or other official regulatory acts.
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1.2
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Anti-competitive conduct with cross-border impact.
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1.3
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Exclusion and exceptions
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Some delegations considered that exclusion refers to areas that are outside the scope of the competition law and that exception refers to case-specific non-application.
Proposal
Commitments to Have, Implement and Enforce Competition Policy
Each Party shall adopt or maintain measures, at a national or sub-regional level, to proscribe anti-competitive business conduct and shall take appropriate action with respect to such conduct.
Anti-competitive conduct with cross-border impact
No Proposal
Exclusions and Exceptions
For the purposes of this Chapter, any exclusions and exceptions from the coverage of national or sub-regional measures to proscribe anti-competitive business conduct should be transparent and reviewed periodically to assess whether they are both necessary and no broader than necessary to achieve their overriding policy objectives.
Item 2 Basic Competition Principles and Criteria
Some delegations consider it would be necessary to define the principles and criteria of competition, while others feel this might not be relevant to negotiations on competition.
Proposal
Each party shall adopt or maintain measures, at a national or sub-regional level, to proscribe anti- competition business conduct with the objective of promoting economic efficiency and/or consumer welfare and shall take appropriate action with respect to such conduct.
Item 3 Identification of Anti-competitive Behaviors to Be Covered by the Negotiations
Proposal
Parties to adopt or maintain measures to proscribe anti-competitive business conduct and to take appropriate action against such practices.
"Anti-competitive business conduct" includes, but is not limited to:
- Hard Core Cartels (definition in the OECD Recommendation);
- Abuse of Dominant Position (NGCP to develop common understanding and language); and
- Anti-competitive Mergers (NGCP to develop common understanding and language).
Item 4 Broad Principles Concerning the Application of Competition Policies and Measures
Proposal
Transparency
Parties to ensure that the measures it adopts or maintains, including laws, regulations, procedures and administrative rulings of general application are published or otherwise publicly available.
National Treatment
Parties to ensure that any actions taken or measures in place to proscribe anti-competitive business conduct are applicable on a national treatment basis.
Non Discrimination
Parties to ensure that any actions taken, measures in place, or rights and remedies available, pursuant to the chapter on competition policy, are applicable on a non-discriminatory basis.
Procedural Fairness
Parties to ensure that administrative and judicial practices and procedures relevant to competition law enforcement are fair and equitable and include reasonable notice and details of claims, an opportunity for defense and to make necessary representations, access to courts and independent decisions.
Item 5 Institutional Provisions
Proposal
Competition Law*
The obligation to adopt or maintain measures to proscribe anti-competitive business conduct and take appropriate action with respect to such conduct
Competent Competition Authorities
Parties to establish or maintain, at the national or sub-regional level, competition authorities which:
- are authorized to take appropriate action under the competition laws and are reasonably independent from political interference; and
- have reasonably independent authority to advocate pro-competitive solutions in the design, development and implementation of Government policy and legislation.
Appeal Process
Parties to ensure that, where legal action is taken to address anti-competitive business practices, an independent national or sub-regional appeal process is available to firms or individuals who are subject to the action.
* Relates to Item 1.1 of Indicative List: "Commitments to have, implement and enforce competition policy and measures which will promote competitive markets in the FTAA, both among countries in the Hemisphere and internally in each of those countries."
Item 6 Mechanisms for Cooperation and for Exchange of Information
Proposal
Cooperation
Parties to recognize the importance of cooperation and coordination among authorities to further effective competition law enforcement in the free trade area, including notification, consultation and exchange of information relating to the enforcement of competition laws and policies.
Unless providing notice would harm its important interests, Parties to notify another Party when a proposed competition law enforcement action may have an effect on the second Party's important interests, and give full and sympathetic consideration to possible ways of fulfilling its enforcement needs without harming those interests.
Confidentiality Laws
Nothing in this Chapter shall require the provision of information by a Party or its competition authority contrary to its laws including those regarding disclosure of information, confidentiality or business secrecy.
Parties may enter into mutual cooperation and mutual legal assistance arrangements.
Item 7 Technical Assistance and Information Dissemination
Proposal
Parties to recognize the importance of technical assistance and information dissemination to facilitate implementation and enhancement of commitments of member countries under the FTAA chapter on competition policy.
Item 8 Regulatory Policies And Practices, Official Monopolies and State Enterprises
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Effects of regulatory policies on market access and conditions of competition.
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8.1.1 |
Need for pro-competitive regulatory principles.
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8.2 |
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Official monopolies and state enterprises.
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8.3
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Competition advocacy.
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| 8.4 |
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Effects of State aids on competition.
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Some delegations feel that this item could be dealt with by the Negotiating Group on Subsidies, Antidumping and Countervailing Duties.
Proposal
No Proposal
Item 9 Dispute Settlement
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Evaluate the possibility of establishing a specific dispute settlement mechanism for competition or the possibility of applying the general FTAA dispute settlement mechanism.
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| 9.2
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Evaluate what provisions or commitments, if any, would be subject to the dispute settlement mechanism.
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| 9.3
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Possibility of establishing other mechanisms to ensure or review country compliance with commitments.
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The delegations considered that the dispute settlement system should not be launched to challenge or review administrative or judicial decisions made by a country in specific cases of competition law enforcement.
Proposal
Committee
A Committee shall be established whose principal members shall be comprised of a representative from each Party's competition authority and/or another person, including a trade official, with competency and expertise in the area of competition law and policy.
The Committee shall meet to consider matters regarding the operation, implementation and interpretation of this Chapter and to conduct non-binding, periodic reviews of Parties' or sub- regional competition policies and practices.
The purpose of reviews of Parties' or sub-regional competition policies and practices will be to contribute to improved adherence by all Parties to rules, disciplines and commitments under the chapter on competition policy by achieving greater transparency in, and understanding of, the competition policies and practices of Parties and sub-regional groupings and their impact on the FTAA region. Such reviews are not, however, intended to serve as a basis for the enforcement of specific obligations under the chapter on competition policy, or for dispute settlement procedures, or to impose new policy commitments on Parties or sub-regional groupings.
The Committee may make recommendations on the operation, implementation and interpretation of this Chapter as well as whether changes in the obligations under this Chapter are warranted to the FTAA Commission.
The Committee shall act by consensus. Unless the Committee decides otherwise, its reports shall be public.
Confidentiality
Nothing in the chapter on competition policy shall require the provision of information by a Party or its competition authority contrary to its laws including those regarding disclosure of information, confidentiality or business secrecy.
Item 10 Compliance with Commitments Given Asymmetry of Country Development
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Consideration should be given to economic development and the size of the economy, as well as the stage of legislative and institutional development of countries.
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10.2
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Possibility of a transitional period
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Some delegations stated that consideration should be given to the need for a transitional period to implement competition policy commitments within the FTAA. Other delegations see this as a part of FTAA negotiations, where the possibility of a general or specific transition period for FTAA implementation will be determined.
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Some delegations expressed the view that, during the negotiations, consideration will be given to the creation of a permanent, non-binding review mechanism for competition policy making and enforcement. Some delegations consider that the results of such review shall not prejudge any dispute.
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Proposal
No Proposal
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