By: Diego Petrecolla, U. de San Andrés
Argentina’s Defense of Competition Law 25156 (DCL) was approved in 1999. It has never been properly enforced, since the National Competition Defense Tribunal which (NCDT) it established was never assembled. The NCDT was conceived as an independent agency, free from political power and isolated from private sector interests. The Kirchner couple, however, never showed the slightest interest in actually forming the NCDT. Instead, competition regulation continued under the Secretariat for Trade, which issued “non-binding” resolutions through its National Commission for Competition Defense (NCCD). This choice made ensured that decisions over competition matters would focus on “political” objectives, rather than “economic” ones. This was all laid bare last year (2014) with the passing of the new “Supply legislation”, which eliminates all of the NCDT’s powers and formally transfers them to the Trade Secretary.
In recent years the Kirchner-Fernandez administration has used the DCL as an instrument for fighting inflation. The law’s original intent, of course, was to protect the wellbeing of consumers and the efficient workings of the market. It is not the right tool to fight inflation. This kind of legislation should be applied to specific sectors, and is therefore best suited to solving microeconomic problems, rather than macroeconomic ones. Inflation, as is well known, is best controlled through proper use of monetary and fiscal policy.
The DCL’s powers include: M&A regulation, sanctioning anti-competitive behavior (particularly cartel formation and abuse of market share cases). The administration has not used either of these effectively: No major sanctions have been imposed for anti-competitive behavior in over three years, and the time taken to review mergers and acquisitions has tripled with the NCCD’s involvement.
The law should be applied primarily on particular sectors. I would suggest starting with Mass-consumption products and goods, particularly foodstuffs, as well as industrial goods. The first group is important because competition issues in this sector directly affect the poorest citizens, who will devote a large part of their income to food. The second group is singled out because of its importance for the competitiveness of the economy as a whole. Both issues are of great importance these days.
It is a shame that the Administration has used this intriguing tool for political ends. It is even more worrying that they should try to wield it to battle inflation- a problem it was never designed for.
Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.
Featured News
Uruguayan Antitrust Scrutiny Puts Major Meatpacking Deal Between Marfrig and Minerva on Hold
May 19, 2024 by
CPI
Alaska Airlines Seeks Dismissal of Consumer Lawsuit Over $1.9 Billion Hawaiian Airlines Buy
May 19, 2024 by
CPI
Idaho Attorney General Orders Split of Kootenai Health and Syringa Hospital
May 19, 2024 by
CPI
Court Rejects T-Mobile’s Appeal Bid in Antitrust Case Over Sprint Merger
May 19, 2024 by
CPI
Google Requests Judge, Not Jury, to Decide on Antitrust Case
May 19, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Ecosystems
May 9, 2024 by
CPI
Mapping Antitrust onto Digital Ecosystems
May 9, 2024 by
CPI
Ecosystems and Competition Law: A Law and Political Economy Approach
May 9, 2024 by
CPI
Ecosystem Theories of Harm: What is Beyond the Buzzword?
May 9, 2024 by
CPI
Open Ecosystems: Benefits, Challenges, and Implications for Antitrust
May 9, 2024 by
CPI