Trade Competition And Thai Business Law Explained

In a world changing as rapidly as ours, sometimes it seems that laws are outdated as soon as they are penned into existence

. In Thailand, the law that aims to preserve free market conditions in all industries and competition is known as the Trade Competition law. This Thai law is facing an overhaul shortly, so we are looking at what the law actually specifies and tries to protect, some examples of trade competition law from other countries, and a brief interpretation by Thai business legal services of the Act.

The basics of Thai laws on trade competition

Here are some of the basic facts about Thai competition law - many of these vary little from country to country.

.Objective: To promote free and fair trade, by prohibiting anti-competitive practices.

.Scope: All ordinary business come under the law, however for some types of organizations this Thai law doesn't apply. Farming groups and co-ops for the benefit of farmers are one; state enterprises and administrative facilities for provincial and local areas are also exempt.

.Enforcement: Is theoretically done by the Competition Commission.

Competition laws around the world

Every country's laws on competitive practices differ somewhat from the Thai laws, naturally. In general though, competition laws around the world will prohibit practices like collusion and cartel (when companies that are competing agree amongst each other that they will fix prices at a certain level); the development of monopolies (where larger businesses gradually buy out all smaller competing businesses, so that eventually they are the only reasonable option left in a particular industry); mergers and acquisitions (while these are not specifically prohibited, there is quite a lot of red tape surrounding them).

Worldwide, competition laws are also tightly intertwined with intellectual property rights.

Thai corporate legal services explain - what do the laws mean?

Look at reporting of Thai laws on competition, and you'll generally find that only the basics are explained. Most commentary will tell you that abuse of market position, mergers causing monopolies, collusive practices creating monopolies (cartels), import restricting agreements and 'unfair trade practices' are prohibited. But what does this mean, in practical terms? Thai lawyers often see that it is possible to unwittingly break the Trade Competition law ... how can this happen?

.Setting unfair prices: This would come under abuse of market dominance, and is highly subjective - many businesses could come under investigation for this.

.Limiting supply of goods and services to create a shortage: Having supply problems obviously wouldn't come under these Thai law criteria, but deliberately holding back your supplies may.

.Collaborating with other businesses: This is where the help of Thai business law experts can be vital. In some cases there are very reasonable explanations for collaborating with another business, and in some cases those collusions could create a sort of monopoly. If it is necessary, your Thai legal service can help you apply to the Competition Commission for an exemption.

by: Gregory Smyth

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