Competition law and policy in El Salvador [electronic resource] : a peer review

2008·2 MB·English

by  Organisation for Economic Co-operation and Development

OECD
((
ORGANCIOS-DAOETPVIEEORLNAOTFPIOMORENNEATCNODNOMIC DEIVNETLERO-PAMMEENRTICBAANNK
CompetitionLawandPolicyinChile
APEERREVIEW
TohfitsherepOoErtCwDasCopmrpeeptairteidobnyDTievrirsyioWn.inBselfoowr,ectohnesnulthaentspteontthe20OEyCeaDr,spirnevviaoruisoluysapomseitmibonesr,
includingActingDirector,attheUnitedStatesFederalTradeCommission’sBureauof
Competition.

COMPETITIONLAWANDPOLICYINCHILE:APEERREVIEW
FOREWORD
“Peerreview”hasbeenacoreelementofOECDco-operationsincethe
owriglalniinsganteisosnowfasOfEoCunDdedc.ouCnot-roipeesrattoiosnuhbamsitaltwhaeyisrbleaewnsfoaunnddepdoluipcioensthteo
questioning byother members. Thispeerreview process promotes
transparencyandmutualunderstandingforthebenefitofall,whilegiving
thereviewedcountryvaluableinsightsaboutpossibleimprovements.Such
cpool-iocpye.raItnioncohmapsethiatdiornemlaarwkabelnefosruccecmeesnst,inOthEeCaDreacoofunctormipesetihtaivoenlbaewcoamned
partnersinseekingtohaltharmfulinternationalcartelsandmergers.Andthe
OECD’sCompetitionCommitteealsoplayedamajorroleinassessingand
demonstratingtheusefulnessofapplyingcompetitionpolicyprinciplesin
theprocessofreformingregulatorysystems.
convTehregesnucceceasmsoonfgpOeeErCrDevicoeuwntirniepsroemnoctoiunrgagceod-otpheeraItDioBnaannddOvoElCunDtartyo
includepeerreviewaspartoftheirjointLatinAmericanCompetition
FtmhuoetruuOamlE.lCyTDhibseCneeJnfotiircneitalfOoErdCCiDoa/-looIgpDueBeratpwiriotonhgwriaOtmEhmCeNDowni-lmlMeedmmebbveeerrlsosp,auwnnhddiecrnhotpnhreoammeoegtmiesbseoraf
economies.TheoverallgoalsofIDB/OECDco-operationprogramme
concludedinthis areaaretohelppromoteeconomicgrowthand
employment,greatereconomicefficiency,andahigheraveragestandardof
livinginthemediumtolongterm.Thereisincreasingconsensusthatsound
competitionlawsandpoliciesareimportanttotheachievementofthese
goals,andtheIDBandOECDcanbestpromotetheselawsandpoliciesby
combiningtheirresourcesandtakingadvantageofeachinstitution’s
comparativeadvantage.
InordertoincludeapeerreviewintheLatinAmericanCompetition
Forum,itwasofcoursenecessaryforacompetitionauthoritytovolunteerto
receiveareview.Fortunately,Chile’scompetitionauthorityhadalready
emxeperteisnsgedofinttheeresOtEiCnbDeiGnlgobpaelerFroervuiemweodnaCfotemrpehteiatriionng.abWohuetntheplparnoscefsosratthae
LatinAmericanCompetitionForumcametogetherinAugust2002,Chile
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COMPETITIONLAWANDPOLICYINCHILE:APEERREVIEW
volunteeredtobereviewedattheForum’sfirstmeetingon7-8April2003.
Byallaccounts,thepeerreviewwasthemostsuccessfulpartofthat
meeting,andPeruhasnowvolunteeredtobepeerreviewedatanupcoming
Forummeeting.
Thepeerreviewreportthatfollowsincludesanupdatethatexplains
stepsthatChileanditscompetitionauthorityhavetakensincetheApril
2003peerreviewsession.Evenbeforethepeerreviewwasscheduled,Chile
wasconsideringimportantamendmentstoitscompetitionlaw.Thereport
andcommentsbyForumparticipantsgenerallysupportedtheproposed
amendments,whichhavenowbeenadopted.Inaddition,thecompetition
enforcementauthorityhasadoptedfourinternalchangestodealwithissues
raisedinthereport.
WewouldliketorenewourthankstotheResearchDepartmentofthe
IDBforhelpingcreatetheForumandfinancingChile’speerreviewandto
ChileforbeingthefirstcountryreviewedintheForum,andtothemany
competitionofficialswhosewrittenandoralcontributionstotheForumare
soimportanttoitssuccess.
EricBurgeat CarloBinetti
Director IDBSpecialRepresentative
CentreforCo-operationwith inEurope
Non-Members
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COMPETITIONLAWANDPOLICYINCHILE:APEERREVIEW
TABLEOFCONTENTS
AnUpdateonDevelopmentsSinceApril2003 7
Summary 11
1. TheEconomicandPoliticalContext 14
11..12 CHiusrtroernitcaelccoonnotmeixctcontext 1144
11..34 CGheinleer’aslfeircsotncoommpiectpiotliiocniels,aw1970-1973 1155
11..65 CEhciolneo’smiccurproelnitciceosmpseitnictei1on97l3aw 116
2. TheGoalsofChile’sCompetitionLaw 18
3. TheContentofTheCompetitionLaw 25
3.1 Thecompetitioninstitutions 25
3.2 Thelaw’ssubstantiveframework 31
3.3 Thelaw’scoverage 33
4. SubstantiveCompetitionLawViolations 36
44..21 HVeorrtiizcoanltaalgraegermeeenmtesntasndpractices 4318
4.3 Monopolisationorabuseofdominance 42
4.4 Mergersandacquisitions 44
4.5 Unfaircompetition 46
5. CompetitionLawandPolicyinRegulatedSectors 48
5.1 Telecoms 48
5.2 Electricity 50
5.3 Bankingandfinancialservices 52
5.4 Waterandsewerservices 53
5.5 Transportation 54
5.6 Othersectors 54
6. CompetitionAdvocacy 56
7. PolicyOptions 58
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COMPETITIONLAWANDPOLICYINCHILE:APEERREVIEW
AnnexA 64
AnnexB 65
Notes 72
References 74
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COMPETITIONLAWANDPOLICYINCHILE:APEERREVIEW
ANUPDATEONDEVELOPMENTSSINCEAPRIL2003
ThisreportoncompetitionlawandpolicyinChileisaneditedversion
oatftthheereIpDoBr/tOthEaCtDproLvaitdiendtAhmeerbaisciasnfoFrotrhuempeeornre8viAepwritlhat20w0a3scaotndOuEctCeDd
HeadquartersinParis,France.Someupdates,suchasSupremeCourt
affirmationoftwocompetitiondecisions,havebeenincorporatedintothe
textofthereport.Inaddition,severalreformssincethenmeritseparate
treatment.First,asanticipated,theproposedcompetitionlawthatis
describedinthereporthasbeenenacted.Second,Chile’scompetition
enforcementauthority,theNationalEconomicProsecutor,hasadoptedfour
reformsthatimplementthereport’srecommendations.
Amendmentstothecompetitionlaw
ChileanLawNo.19.911,publishedon14November2003,amendsthe
priorcompetitionlawbycreatinganewCompetitionTribunal and
introducinganumberofotherreforms.Thelawwillgointoeffectsix
monthsfromitspublicationdate.
Asproposed,theTribunalwillbeanindependententitythathasjudicial
pTohweePrrsesbiudtenitsnoofttfheorTmrailbluynapla,rtwohfotmheusjtudbiceiaaryl.awIytewrilwlihthavaetlfeiavsetmteemnbyeerasr.s
ofexperienceinthecompetitionlawfield,willbeappointedbythe
PresidentoftheRepublicfromalistoffivenomineesestablishedbythe
SupremeCourtthroughapubliccompetition.Theothermembers(two
lawyersandtwoeconomists)willbechosenasfollows.Onelawyerandone
eesctoanbolmiisshetdwiblyltbheecCheonstreanlbByatnhkeP(rCeosuindceinltoffroGmovearnliosrtso),ftahlrseoetnhormoiugnheesa
publiccompetition.Theotherlawyerandeconomistwillbeappointed
directlybytheCentralBankfromcandidatesselectedbythissamepublic
competition.TheTribunalwillalsohavefoursurrogatemembers,selected
bythePresidentoftheRepublicandtheCentralBankfromthesamelistsof
nominees.Allcandidatesarerequestedtohaveexpertiseincompetition
issues.
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COMPETITIONLAWANDPOLICYINCHILE:APEERREVIEW
ThemembersoftheTribunalhavetermsofsixyears,andmayserve
morethanoneterm.Duringtheirterms,theycanonlyberemovedforcause.
Neitherpublicservants norofficersoremployeesofpubliclyheld
corporations(ortheiraffiliates)areeligible.MembersoftheTribunalwill
receivefixedremunerationplusafeethatwillvarydependingonthe
amountofwork.(Bylaw,theTribunalmustmeetatleasttwiceperweek,
balustoihtaivseexitpseoctwendsttoaffm.eetatleastthreetimesperweek.)TheTribunalwill
Otherchangesclarifyhowparticularkindsofanticompetitiveconduct
sinhtoeunlddebdetcoongasiind,ermeadinatnadinb,anor“uinnfcarierasceomapedtoimtiinona”ntonploysiwtihoenn.tThheecolnadwucntoiws
providesalimited“settlement”procedure.Imprisonmentiseliminatedasa
sanction,buttheamountoffinesisraised,toUS$tenmillion.Theheadof
thecompetitionenforcemententity,theNationalEconomicProsecutor,is
givennewpowers,includingtheauthoritytosignagreementswithdomestic
agenciesandforeignentities.
Reformsbythecompetitionenforcementagency
TheNationalEconomicProsecutorhasadoptedfourreformsthat
addressissuedraisedbythepeerreview.First,theProsecutorhascreateda
newunitwithintheEconomicsDepartment thatisresponsible for
consideringthecompetitiveeffectsofproposedmergers.Chilestilldoesnot
haveapremergernotificationprogrammeanddoesnotregardsucha
programmeasnecessary,butthecreationofthismergerunitisvery
importantasanofficialandpublicstatementofintentiontoassessmergers.
Second,theProsecutorhascreatedanewunitwithintheLegal
Departmentwhosefunctionistoreviewproposedlegislationandproposed
regulationsthatcouldharmcompetition.Inshort,Chilehastakena
significantsteptowardshavingasystematicprogrammeofcompetition
advocacy.
Third,theProsecutorhasadoptedaninternalorderonhowinvestigators
writethe“reports”thatconstitutetheirfindings.Forexample,theorder
requiresthatinvestigatorsmustalwaysincludeinformationaboutthe
relevantmarketsandmustco-ordinate theirreportswith theLegal
Departmenttoensurethelegalsufficiencyoftheanalysis.
Fourth,theProsecutorhastakenstepstomakethebusinesscommunity
andthepublicmoreawareofcompetitionlawmatters.On30November,the
ProsecutorheldChile’sfirst“CompetitionDay”-aneventthatbrought
togetherabout250lawyersandotherstohearaboutthenewlyenacted
amendmentstothecompetitionlawandotherrelevantmatters.Amongthe
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COMPETITIONLAWANDPOLICYINCHILE:APEERREVIEW
speakerswasMr.FernandoSanchezUgarte,PresidentofMexico’sFederal
CompetitionCommission,whohadchairedthepeerreviewofChileatthe
April2003meetingoftheIDB/OECDLatinAmericanForum.Echoingthe
peerreviewreport,hecongratulatedChileforbeingapioneerincompetition
policy,stressedcompetitionpolicy’scentralroleineconomicregulation,
supportedtheproposedamendments,andsuggestedfurtheractioninsome
areas to reduce Chile’s vulnerability to international cartels and
anticompetitivemergers.
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