By command of His Majesty Sultan Haji Hassanal Bolkiah Mu’izzaddin Waddaulah ibni Al-Marhum Sultan Haji Omar ‘Ali Saifuddien Sa’adul Khairi Waddien, Sultan and Yang Di Pertuan of Brunei Darussalam, it is hereby announced that His Majesty has consented to the enforcement of the section 11 prohibition on Anti-Competitive Agreements of the Competition Order 2015 and the provisions relating to this prohibition to take effect on 1 January 2020.
The Competition Order 2015 has the objective to promote market efficiency and consumer welfare in Brunei Darussalam economic landscape through the prohibition of anti-competitive conducts including Anti-Competitive Agreements (Cartel), Abuse of Dominant Position and Anti-Competitive Merger. Through deterring anti-competitive conducts, the Order aims to promote a healthy business eco-system which can build business efficiency and competitiveness that can benefit business ultimately in the export market and also benefit consumers through better choice of goods and quality and competitive pricing.
In line with best practices and Brunei’s domestic context, the implementation and enforcement of the Order is introduced in phases. Since the enactment of Competition Order 2015, the regulatory framework of the Order has been gradually put into place, starting with the establishment of Competition Commission of Brunei Darussalam and its implementing arm, the Department of Competition and Consumer Affairs in the Department Economic Planning and Development (DEPD), Ministry of Finance and Economy. The enforcement of the section 11 prohibition on Anti-Competitive Agreements underlined the subsequent of the phase implementation towards the full enforcement of the Competition Order 2015.
The section 11 of the Competition Order 2015 prohibits anti-competitive agreements between two or more businesses that has an object or effect to limit, prevent, distort or restrict competition in Brunei Darussalam, regardless how the agreement was reached and where the agreement was made – within or outside Brunei Darussalam. Anti-competitive agreements include price fixing, bid rigging, market sharing and supply limitation agreed between or among businesses. For instance, businesses collude to rig the tendering process by taking turns on who will submit the lowest bid and be the designated winner. These offences are categorized as hardcore cartel which are per se illegal.
Similarly, the involvement of business association in determining or recommending prices to be set in the market and facilitating the exchange of sensitive market information are also prohibited with the enforcement of the Order.
The Order applies to all commercial activities across sectors with exception to the functions of the Government and statutory bodies as well as entities that carry out activities on their behalf. The Order excludes activities listed in the Third Schedule of the Order such as service of general economic interest, compliance with legal requirements, avoidance of conflict with international commitments and public policy.
A formal investigation can be launched by the Competition Commission through the Department of Competition and Consumer Affairs should there be reasonable grounds to suspect provisions under the Order have been infringed. The Competition Commission is empowered to issue notices to require businesses to provide information and documents.
A financial penalty of up to 10% of business annual turnover in Brunei Darussalam, up to maximum period of 3 years, may be levied to businesses which are found to have infringed the Order.
Leniency programme will be put into place to encourage businesses to approach the Commission and disclose anti-competitive conducts that they had been involved with. Businesses may be granted up to full immunity from financial penalties in exchange to information disclosure and cooperation.
Businesses are urged to take proactive steps to understand the Order and any necessary steps to ensure compliance. Several regulations and guidelines will be made available to help businesses understand how the Commission will administer and enforce infringements of the prohibitions in the Order as well as provide greater clarity and transparency to businesses on the competition law application.
Enforcement of the Competition Order 2015 aims to promote ethical business conduct and respect to competition process for the benefit of the market, consumer welfare and economy as a whole. An efficient market will provide Brunei Darussalam with the competitive advantage not just domestically but also export market.
More information about the Competition Order 2015 can be found at www.depd.gov.bn/cad.