The Philippine Competition Act (PCA) or R.A.

10667 is the primary

competition policy of the Philippines for promoting and protecting
competitive market. A competitive market means a market with
multiple buyers and multiple sellers, driving market prices lower
and offering consumers more choices.

The act reflects the belief that competition:

• Promotes entrepreneurial spirit,

• Encourages private investments,
• Facilitates technology development and transfer, and
• Enhances resource productivity.
Section 24. Relevant Market. – For purposes of determining the relevant market, the following
factors, among others, affecting the substitutability among goods or services constituting such
market and the geographic area delineating the boundaries of the market shall be considered:

a) The possibilities of substituting the goods or services in question, with others of

domestic or foreign origin, considering the technological possibilities, extent to which
substitutes are available to consumers and time required for such substitution;

b) The cost of distribution of the good or service, its raw materials, its supplements and
substitutes from other areas and abroad, considering freight, insurance, import duties
and non-tariff restrictions; the restrictions imposed by economic agents or by their
associations; and the time required to supply the market from those areas;

c) The cost and probability of users or consumers seeking other markets; and

d) National, local or international restrictions which limit access by users or consumers to

alternate sources of supply or the access of suppliers to alternate consumers.
Section 25. Control of an Entity. – In determining the control of an entity, the Commission may
consider the following:
Control is presumed to exist when the parent owns directly or indirectly, through subsidiaries,
more than one half (1/2) of the voting power of an entity, unless in exceptional circumstances, it
can clearly be demonstrated that such ownership does not constitute control. Control also
exists even when an entity owns one half (1/2) or less of the voting power of another entity
when:
(a) There is power over more than one half (1/2) of the voting rights by virtue of an agreement
with investors;
(b) There is power to direct or govern the financial and operating policies of the entity under a
statute or agreement;
(c) There is power to appoint or remove the majority of the members of the board of directors
or equivalent governing body;
(d) There is power to cast the majority votes at meetings of the board of directors or
equivalent governing body;
(e) There exists ownership over or the right to use all or a significant part of the assets of the
entity;
(f) There exist rights or contracts which confer decisive influence on the decisions of the
entity.
Section 26. Determination of Anti-Competitive Agreement or Conduct. – In determining
whether anti-competitive agreement or conduct has been committed, the Commission
shall:

(a) Define the relevant market allegedly affected by the anti-competitive agreement
or conduct, following the principles laid out in Section 24 of this Chapter;
(b) Determine if there is actual or potential adverse impact on competition in the
relevant market caused by the alleged agreement or conduct, and if such impact
is substantial and outweighs the actual or potential efficiency gains that result
from the agreement or conduct;
(c) Adopt a broad and forward-looking perspective, recognizing future market
developments, any overriding need to make the goods or services available to
consumers, the requirements of large investments in infrastructure, the
requirements of law, and the need of our economy to respond to international
competition, but also taking account of past behavior of the parties involved and
prevailing market conditions;
(d) Balance the need to ensure that competition is not prevented or
substantially restricted and the risk that competition efficiency, productivity,
innovation, or development of priority areas or industries in the general interest
of the country may be deterred by overzealous or undue intervention; and

(e) Assess the totality of evidence on whether it is more likely than not that the
entity has engaged in anti-competitive agreement or conduct including whether
the entity’s conduct was done with a reasonable commercial purpose such as
but not limited to phasing out of a product or closure of a business, or as a
reasonable commercial response to the market entry or conduct of a
competitor.
Section 27. Market Dominant Position. – In determining whether an entity has
market dominant position for purposes of this Act, the Commission shall
consider the following:
(a) The share of the entity in the relevant market and whether it is able to fix
prices unilaterally or to restrict supply in the relevant market;
(b) The existence of barriers to entry and the elements which could foreseeably
alter both said barriers and the supply from competitors;
(c) The existence and power of its competitors;
(d) The possibility of access by its competitors or other entities to its sources of
inputs;
(e) The power of its customers to switch to other goods or services;
(f) Its recent conducts; and
(g) Other criteria established by the regulations of this Act.
There shall be a rebuttable presumption of market dominant position if the market share of an
entity in the relevant market is at least fifty percent (50%), unless a new market share threshold
is determined by the Commission for that particular sector.

The Commission shall from time to time determine and publish the threshold for dominant
position or minimum level of share in the relevant market that could give rise to a presumption
of dominant position. In such determination, the Commission would consider the structure of
the relevant market, degree of integration, access to end-users, technology and financial
resources, and other factors affecting the control of a market, as provided in subsections (a) to
(g) of this section.

The Commission shall not consider the acquiring, maintaining and increasing of market share
through legitimate means not substantially preventing, restricting, or lessening competition in
the market such as but not limited to having superior skills, rendering superior service,
producing or distributing quality products, having business acumen, and the enjoyment and use
of protected intellectual property rights as violative of this Act.
Section 28. Forbearance. – The Commission may forbear from applying the provisions of this
Act, for a limited time, in whole or in part, in all or specific cases, on an entity or group of
entities, if in its determination:
(a) Enforcement is not necessary to the attainment of the policy objectives of this Act;
(b) Forbearance will neither impede competition in the market where the entity or group of
entities seeking exemption operates nor in related markets; and
(c) Forbearance is consistent with public interest and the benefit and welfare of the
consumers.
A public hearing shall be held to assist the Commission in making this determination.
The Commission’s order exempting the relevant entity or group of entities under this section
shall be made public. Conditions may be attached to the forbearance if the Commission deems
it appropriate to ensure the long-term interest of consumers.
In the event that the basis for the issuance of the exemption order ceases to be valid, the order
may be withdrawn by the Commission.
Section 29. Administrative Penalties. –

(a) Administrative Fines. – In any investigation under Chapter III, Sections 14 and 15, and Chapter
IV, Sections 17 and 20 of this Act, after due notice and hearing, the Commission may impose the
following schedule of administrative fines on any entity found to have violated the said sections:
First offense: Fine of up to one hundred million pesos (P100,000,000.00);
Second offense: Fine of not less than one hundred million pesos (P100,000,000.00) but not more
than two hundred fifty million pesos (P250,000,000.00).
In fixing the amount of the fine, the Commission shall have regard to both the gravity and the
duration of the violation.

(b) Failure to Comply With an Order of the Commission. – An entity which fails or refuses to
comply with a ruling, order or decision issued by the Commission shall pay a penalty of not less
than fifty thousand pesos (P50,000.00) up to two million pesos (P2,000,000.00) for each violation
and a similar amount of penalty for each day thereafter until the said entity fully complies. Provided
that these fines shall only accrue daily beginning forty-five (45) days from the time that the said
decision, order or ruling was received.
(c) Supply of Incorrect or Misleading Information. – The Commission may likewise impose upon
any entity fines of up to one million pesos (PI,000,000.00) where, intentionally or negligently, they
supply incorrect or misleading information in any document, application or other paper filed with or
submitted to the Commission or supply incorrect or misleading information in an application for a
binding ruling, a proposal for a consent judgment, proceedings relating to a show cause order, or
application for modification of the Commission’s ruling, order or approval, as the case may be.

(d) Any other violations not specifically penalized under the relevant provisions of this Act shall be
penalized by a fine of not less than fifty thousand pesos (P50,000.00) up to two million pesos
(P2,000,000.00).
Provided that the schedule of fines indicated in this section shall be increased by the Commission
every five (5) years to maintain their real value from the time it was set.
Section 30. Criminal Penalties. – An entity that enters into any anti-
competitive agreement as covered by Chapter III, Section 14(a) and 14(b)
under this Act shall, for each and every violation, be penalized by
imprisonment from two (2) to seven (7) years, and a fine of not less than fifty
million pesos (P50,000,000.00) but not more than two hundred fifty million
pesos (P250,000,000.00). The penalty of imprisonment shall be imposed
upon the responsible officers, and directors of the entity.
When the entities involved are juridical persons, the penalty of. imprisonment
shall be imposed on its officers, directors, or employees holding managerial
positions, who are knowingly and willfully responsible for such violation.
Agris, Charmaine Joy
Andrada, Ma. Salvie
Cordenillo, Roberto III
Pasco, Junna Rose