Overview of the Competition Policy Unit

The Competition Policy Unit (CPU) is the competition protection, competition promotion and competition investigation arm of the Competition and Consumer Affairs Commission (CCAC). In its general sense the CPU exists to ensure compliance to the Competition and Fair Trading Act (CFTA). The CPU’s role therefore is derived from the Competition and Fair Trading Act, the objectives of this Act are as follows:

  1. To promote, maintain and encourage competition and enhance economic efficiency in production, trade and commerce;
  2. Prohibit anti-competitive business conduct which prevents, restricts or distorts competition or constitutes the abuse of a dominant position in the marker; and
  3. Promote the welfare and interests of consumers

 

Ultimately, the primary goal of Guyana’s competition law is interpreted by the CCAC as two-fold: (i) to protect the competitive process and (ii) to promote consumer welfare.

Competition Explained

In its simplest form, competition can be thought of as intense rivalry among players that puts each of them under pressure to perform at their best. In relation to competition law, it is intense rivalry among market players or businesses that forces each to operate optimally. The more intense the rivalry among enterprises the greater the benefits that would accrue to:

  • Consumers in the form of lower prices and better quality products and services, thereby improving their welfare and contributing to their protection;
  • Businesses because in a more competitive and level business environment small and large businesses can compete fairly for their share of the market. Additionally, strong competition forces businesses to become more efficient by controlling their costs and offer better and new products and services that consumers want, leading to positive reputational effects and brand image. In such a competitive environment business are under constant pressure to perform optimally to avoid losing customers and revenue to their rivals.
  • The Economy because increased competitiveness leads to increased productivity and more efficiently functioning markets which encourages economic growth.

 

Key Responsibilities of the Competition Policy Unit

In pursuance of the above mentioned goals the CCAC through its competition arm, seeks to curtail business strategies which when implemented have the effect of creating inefficiencies in the market and therefore lowered levels of consumer welfare. Market inefficiencies can manifest themselves as reduced production rates and slower production times, lower outputs and little recourse to product research and innovation. These inefficiencies can lead to higher price and low-quality products with little or no innovations.

Certain business arrangements / agreements between competitors and between producers and their suppliers and also certain unilateral decisions taken by an economically strong market player can result in market inefficiencies and therefore lowered levels of consumer welfare. Those activities of manufacturers, importers and retailers will therefore be closely monitored by the CPU.

In pursuance of its goal to protect the competitive process, the CCAC, through its competition arm, brings cases against infringing parties. The Commission can apply a range of pecuniary, punitive and injunctive remedies available to it to correct the behaviour of the infringing parties once found guilty.

Furthermore, to promote competition among market players the CPU employs advocacy initiatives and programs to encourage rivalry among firms, encourage a reduction or elimination of obstacles to firms gaining the ability to enter and remain profitably on a market, as well as lobby for the removal of government erected barriers or restrictions on trade.

More specifically, as the competition protection, promotion and investigation arm of the CCAC, the Competition Policy Unit discharges the following functions:

  1. Keep under review commercial activities with a view to ascertaining practices which may adversely affect the economic interests of consumers;
  2. Conduct investigations in relation to the conduct of business in order to determine whether any enterprise is engaging in business practices in contravention of the CFTA
  3. Conduct relevant inquiries in keeping with the ambits of the CFTA
  4. Make available to persons engaged in business, general information with respect to their rights and obligations under the CFTA
  5. Make available for the guidance of consumers, general information with respect to the rights and obligations of persons under the CFTA, affecting the interests of consumers
  6. Undertake studies and publish reports and information regarding matters affecting the interests of consumers
  7. Co-operate with and assist any association or body of persons in developing and promoting the observance of standards of conduct for the purpose of ensuring compliance with the provisions of the CFTA