SAWTEE in association with Lawyers' Academy Committee, Nepal Bar Association (NBA) and Society of Economic Journalists of Nepal (SEJON) organized a discussion forum on “Status of Competition in Nepal” on 5 December 2011 to mark the World Competition Day. The World Competition Day is celebrated on 5 December every year to mark the adoption by the United Nations of the Set of Multilaterally Agreed Equitable Principles and Rules for the Control of Restrictive Business Practices. This year the World Competition Day was marked with the theme 'Cartels and their harmful effects'.
The executive chairman of SAWTEE, Dr. Posh Raj Pandey chaired the forum which hosted Hon’ble Mr. Lekh Raj Bhatta, Minister of Commerce and Supplies, Government of Nepal as the chief guest. In the discussion forum, SAWTEE's program director, Dr. Dhrubesh Chandra Regmi presented a paper on the “Achievements and Challenges of Competition Law in Nepal" in front of participants, which included government officials, representatives from business community, consumer groups, lawyers, journalists, and economists. In his presentation, Dr. Regmi highlighted the rationale, benefits and features of the Competition Law in Nepal. During his presentation, Dr. Regmi also pointed out some of the loop holes in the Competition Promotion and Market Protection Act 2007, particularly feeble enforcement mechanisms that does not provide the Department of Commerce (DoC) with executive power necessary to enforce the Act and thus maintain competition in the market.
In the forum, the Minister of Commerce and Supplies lauded the initiative of the organisers of the forum and accepted the existence of numerous anticompetitive practices in Nepalese market. He opined that many factors were contributing to the existence of anticompetitive practices that require the government to address the root cause of the problem, which according to the Minister was public undertaking that can compete with the private sector hence which can also check anticompetitive practices. In the forum, director of DoC Mr. Tika Prasad Bhandari highlighted the procedural and administrative difficulties in the enforcement of Competition Act. He also recommended, among others, various amendments to the existing Act to ensure adequate authority to the DoC in maintaining competition in the market.
The chair of the forum Dr. Pandey reiterated that competition in market increases efficiency which ultimately gets passed on to the consumers therefore fair competition ensures all get to participate and enjoy the benefits of economic growth. Dr. Pandey also observed that the situation of anticompetitive practices in Nepal owes a lot to the tardiness in the preparation of economic policy and laws when Nepal was liberalizing her economy in the 1990s.In the forum, the general secretary of SAWTEE, Mr. Ratnakar Adhikari highlighted on the objectives of the forum and observed that many anticompetitive practices occur in the market largely due to ignorance and lack of knowledge regarding the law; the forum can prove to be vital in sensitizing the stakeholders and thus ensuring effective abidance of the competition law.
The participants of the forum also actively presented their views and comments regarding the maintenance of fair competition in the market. In general, participants agreed that Nepal should be committed to the free market and that the Competition Act needs to be effectively enforced. During the discussions, participants recommended various changes to the administrative arrangements for the enforcement of the Competition Act. Particularly, participants were unanimous in demanding an independent and powerful competition authority or officer to enforce Competition Act. Similarly, few participants, including consumer rights activist Mr. Jyoti Baniya also recommended amendment to the Competition Act to reduce the threshold of market dominance and to increase the punishment for the violations of the Act. Mr. Baniya also argued that Competition Law is more to the benefit of the businesses than to consumers, thus businesses need to realize this fact and do not indulge in anticompetitive practices. Representatives from the business community reiterated their commitment to abide by the prevailing law including the Competition Act.
In the forum, the representatives from the NBA including the secretary general of the NBA, Advocate Mr. Bijay Prasad Mishra spoke about the importance of the Competition Act and the necessity of training lawyers on the area of competition law. Similarly, the treasurer of the NBA, Advocate Mr. Yubaraj Kumar Bhandari stressed that the government has to be strong to address the problems of anticompetitive conducts in the market. The general secretary of SEJON Mr. Bigyan Adhikari shared his experience of various instances of anticompetitive conducts prevailing in the market, especially anticompetitive conducts in the transport sector.
In short, the forum was successful in highlighting the existence of blatant forms of anticompetitive practices in Nepalese market. In addition, the forum also concluded the need to amend various provisions of the Competition Act and improve administrative and institutional arrangements made available to implement the Act to make the Act more effective. Furthermore, the forum succeeded in bringing all stakeholders together to sensitize, and inform those actors on the issues relevant to maintenance of fair competition.
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