Introduction

The Competition Policy and Deregulation Group's Workshop was held on 27th and 28th of May on Bandar Seri Begawan; Brunei Darussalam. Previously on May 26th the group held an informal meeting to discuss a proposal for a joint cooperation program APEC-OECD on regulatory issues. Twenty APEC economies, the APEC Secretariat and a delegate from PECC attended the meeting.

The main purpose of the workshop was to discuss the views from member economies on the implementation of the APEC Principles to Enhance Competition and Regulatory Reform and the specific projects that need to be considered.

This was the first meeting of the group in 2000 since the Workshop in Christchurch, New Zealand in 30 April - 1 May 1999, and the first one with Peru as Convenor of the Group.

The economies will continue working through electronic means until their next workshop scheduled initially for the year 2001.

1. Major Developments since the 1st CTI meeting

The Convenor reported that at the first meeting held on 16-17 February 2000, the CTI endorsed the proposed work program for year 2000, noting in particular, the key areas highlighted - implementation of the APEC Principles to Enhance Competition and Regulatory Reform and the Road Map on Strengthening Markets. With respect to strengthening markets, the Convenor reported on the Group� point of view that the focus should be centered on the identification of alternative sources of funding for technical assistance programs.

2. Discussion of APEC Principles to Enhance Competition and Regulatory
Reform

The Workshop included presentations from New Zealand, Korea, Peru, United States, Japan, Hong Kong China and the delegate from PECC on effective ways to implement the APEC Principles of Competition and Regulatory Reform.

New Zealand presented the lessons learned on strengthening their competition Law and the challenges related with APEC initiatives on strengthening markets. With respect to the lessons learned, the issues addressed were the interaction between economics and law, the costs of reform and the importance of general deterrence.

Some challenges for the APEC process mentioned were:

• The need to develop capacity for more coherent and globalised policies,
• The need to rethink regulatory approaches taking into account the rapid advances produced in technology -for example, rethink the concept of definition of market-,
• The need to strengthen competition and co-operation in order to avoid problems of cross-border anti competitive behavior.

Korea reported on the efforts of the Korean government and the Korean Fair Trade Commission (KFTC) to encourage policies that create a fair market environment and play a crucial role in enhancing efficiency and fostering competitiveness in the Korean economy. Regarding aspects of Cooperation among Competition Authorities, the KFTC has vigorously pursued international cooperation at bilateral and multilateral level, taking part in dialogues within working groups in the different multilateral fora such as APEC, OECD and WTO.

Some points that were proposed for consideration in the future agenda of the CPD of APEC were:

• The need of raising awareness in other APEC Fora on the necessity of protecting the competitive process.
• The need to reinforce technical assistance programs.
• The need to pursue various programs to promote cooperation among Member Economies.

United States presented the significant benefits that accrue from participating in multinational fora such as APEC, NAFTA, FTAA, OECD and WTO. This interaction has deepened and broadened the U.S. understanding of competition policy issues, and undoubtedly has had much the same beneficial effect on the other participants in these fora. The work done in APEC's competition policy and deregulation workshops has contributed to the U.S. understanding of the dynamics of competition policy in economies structured very differently than its own.

The U.S. experience also indicates that existing frameworks already provide significant opportunities for enhancing cooperation, and for engaging in technical assistance/capacity building. The value of these existing mechanisms should be recognized and enhanced. Multilateral fora such as APEC should be -- as they clearly are -- recognized as organizations that present opportunities for increased understanding -- and for positive action.

Peru presented a brief review of the main efficiencies that arrived into the economy as a result of the reforms implemented by Peruvian government on the Institutional Framework. This experience suggests that the existence of a coherent and consistent mechanism to regulate competition constitute a necessary condition for businesses to achieve increased levels of competitiveness and global economic growth. Peru also reported on the experience of implementing the APEC Principles by Indecopi, the Peruvian Competition Authority.

Four minimum conditions were proposed for the process of implementation of the principles related to:

• Consideration of joint efforts with the private sector and other public organizations for any process of capacity building,
• Design of permanent mechanisms for active participation of the private sector in the process,
• Design of tangible indicators to measure the performance of the institutions in charge of the process and the benefits that the programs generate for the economy, and
• Consideration of the important role that academic sector plays in this process.

Japan reported on the World Bank Conference held in Jakarta on May 22 and 23 and its focus on supporting the vigorous enforcement of the Competition Law in Indonesia. Some of the issues addressed at the conference were related to competition advocacy and the need to build expertise and adequately funding the competition agency. These findings are also considered in the APEC principles.

Hong Kong China stressed the importance of considering different policy responses and the diverse circumstances of the APEC economies in the process of implementing the APEC principles. Any implementation plan should be able to accommodate differences in approaches and timing to promote competition among member economies.

PECC reported on the Trade Policy Forum to be held on May 29 in Brunei, that will addressed the issue of Competition Principles in Practice and PECC� future agenda. The focus of the session will be on capacity building and institutional linkages, stressing the importance of coordination within government administrations in each APEC economy. At this respect, capacity building implies existing institutions working better and more coherently together- within the competition framework.

PECC also proposed three primary levels of cooperation that are required for the next phase of implementation of the APEC principles:

• At the top leadership level, for reinforcing the integrity of the Principles;
• Cooperation by Ministers and officials in actively promoting the Principles and their application throughout APEC� various fora and activities;
• Cooperation within government administrations for giving coherence and practical effect at the national level to competition-driven policy development.

These three levels need to be complemented with a fourth one, related to cooperation among competition agencies.

In the subsequent discussion, the economies considered that the implementation of the APEC Principles should consider a flexible time frame for the process of implementation and stressed the importance of working jointly with other APEC fora and subfora (cross cutting approach), the private sector and academia.

3. Approaches to the revision of the CAP and IAPs

The Project Team of the Prototype Individual Action Plan Project reported on the progress of the review of the format and presentation of IAPs and the development of an electronic or "e-IAP" system. The chapters on Competition Policy and Deregulation coordinated by Peru have already been developed and have received comments from the economies.

With respect to new areas for broadening and deepening CAPs and possible new areas for inclusion, the economies identified two areas in which the Competition policy and Deregulation CAPs need to be revised.

The first one related to the facilitation of the basic understanding by APEC fora and sub-fora of the APEC Principles and its implications for the process of implementation in each respective area. The second one, related to the design of effective and efficient means for reporting on the advancements of the process of implementation of the Principles by APEC fora and subfora.

On these two issues, the economies considered important to seek some definitions from the CTI, so that the Group can proceed to elaborate proposals for modifying the CAP in the areas of Competition Policy and Deregulation.

4. Strengthening markets in respective areas

Japan reported on the Strengthening Legal Infrastructure Project and the APEC SME and New Business Support Workshop Project. The economies expressed their interest in the fast development of the projects with comments to be provided until June 10.

A proposal for APEC-OECD Co-Operation on Regulatory Reform 2000-2001 was presented and discussed with Mr. Scott Jacobs, Head of OECD Regulatory Reform Program. The economies supported the co-operative initiative and agreed to send comments and suggestions to the proposal until June 15 and to start working jointly with the OECD in the design of an opening seminar in October. The seminar will deal with the challenges of regulatory reform, taking stock of progress in the area since the last symposium on regulatory reform held in Kuantan in 1998, and addressing the future challenges in the process of implementation of the APEC Principles.

New Zealand reported on the APEC Public Sector Management Workshop attended from 9 to 11 May in Singapore.

5. Relations with other APEC sub-fora, PECC and APEC Business Community

PECC presented on the next logical steps in capacity building and technical assistance for the implementation of the Competition Principles. Alternative coordination and delivery frameworks that will help the APEC economies in the implementation process were suggested. The economies considered these contributions very valuable and offered their initial reactions to the proposals.

6. Reports from member economies of future projects and activities

Chinese Taipei reported on the future activities of the Competition Policy and Law Database Web site and the development of an on-line trial forum in June 2000.

Japan reported on the outcomes of the Fourth PFP Training Course on Competition Policy and presented a draft outline of the Fifth PFP Training Course to be held in Bangkok in March 2001.

Peru reported on a project profile for the development of case studies on the implementation of APEC Competition Policy Principles, and asked for comments from the member economies to continue developing the project until June 30.

Australia reported on the development by the ACCC of the Resource Network in the ASEAN Region.

7. APEC contribution to the WTO (Competition Policy aspects)

Japan reported on the APEC Seminar on Investment and Competition proposed by Japan and Peru for August and by Japan and Philippines for October 2000. The economies show interest in the development and the outcomes of the project.

Competition Policy and Deregulation Group
Forecast of 2000 TILF Outcomes