• Regulators forced to tackle conflicting legal regimes, evidentiary rules, confidentiality issues
  • Interaction with new ASEAN regulators to help Singapore and Indonesia learn of infringement conduct sooner
  • Indonesian regulator busy with domestic cases involving collusion and corruption, yet to go after international cartels

The move towards economic integration among the member states of the Association of Southeast Asian Nations (ASEAN), combined with the global expansion of antitrust law, could either be a boon or a bane for established antitrust jurisdictions like Singapore and Indonesia, competition lawyers told PaRR.

The member states of ASEAN have a December 2015 deadline to establish a comprehensive competition law regime. This has seen new joiners like Myanmar and the Philippines recently adopting antitrust legislation for the first time, while Cambodia and Brunei are working on their respective drafts.

On one hand, this integration presents opportunities. As more countries introduce competition law in the region, “we can now talk about cooperation among the competition agencies in these member states,” Han Li Toh, chief executive of the Competition Commission of Singapore (CCS), told PaRR in an exclusive interview. In addition to cross-border cooperation related to cartels and merger cases, established jurisdictions like the CCS can help, as the initial focus of many younger jurisdictions would be on capacity building, he added.

Antitrust enforcers in the APAC region, particularly in Singapore and Indonesia, are increasingly focusing their enforcement efforts on international cartel investigations, Ken Chia, a Principal at Baker & McKenzie Wong & Leow, a member firm of Baker & McKenzie in Singapore, said.

The advent of the ASEAN economic community, and the consequent introduction of competition law in all member states, will not change their enforcement priorities, Chia told PaRR. Rather, it may make it easier for regulators in Singapore and Indonesia to learn about potentially infringing conduct sooner through their interactions with these new ASEAN regulators, he pointed out.

On the other hand, the integration could pose challenges. Countries that have had no competition law regime to date are under pressure to adopt legislation, Clara Ingen-Housz, a partner at Linklaters in Hong Kong, said. This could effectively push countries with more antitrust experience like Singapore and Indonesia to look into new areas of enforcement, and to investigate and prosecute more challenging cases, she pointed out.

After the initial few years of enforcement, regulators tend to improve their processes. The CCS has gradually moved towards enforcement, focusing at first on more domestic and straightforward cases. It has thereby preserved due process and has moved only recently towards more complex cases, Ingen-Housz told PaRR.

The Indonesian regulator has had a less linear development. Although it is an independent regulatory body, the Indonesian Competition Commission - Komisi Pengawas Persaingan Usaha Republik Indonesia (KPPU) - has often been described as an unpredictable, politically-driven agency with little room for improvement. The KPPU has been very busy with domestic cases involving a mix of collusion and corruption, and has not yet progressed to prominently enforcing the law against international cartels like Singapore has done, Ingen-Housz said.

Nevertheless, KPPU chairman Syarkawi Rauf said in a university lecture in August that Indonesia is especially prone to multinational cartels in the food sector since many food commodities are traded among Southeast Asian countries. He cited the crude palm oil sector as a prime example due to the presence of Indonesian and Malaysian palm oil companies that control a large share of the global palm oil industry.

While momentum has been created towards economic integration among the ASEAN member states, there are different dynamics at play, as regulators are working at their own pace, depending on each individual country’s background, Ingen-Housz said. Countries like Malaysia, which introduced competition law less than five years ago, are seeking to gain greater momentum by deepening their enforcement and expanding their scope, she added.

Where the law has been in place for some time, legislation is being reviewed to address defects and/or ensure that they meet global standards,Ingen-Housz said, citing Singapore and Vietnam. Thailand, on the other hand, has had legislation for years, but it has been relatively dormant, she said, adding that the country is trying to find ways to activate it.

There is now a widespread perception that a country cannot claim to be a developed market economy if it neither adopts nor enforces a comprehensive competition law regime, Ingen-Housz said.

However, a truly global enforcement network is still a long way off as regulators tackle conflicting legal regimes, evidentiary rules and confidentiality requirements, Chia said.