Senior officials of the Turkish Competition Agency (TCA) have appreciated the work done by the Competition Commission of Pakistan (CCP) and the achievements it has made in the competition law enforcement despite financial constraints.
A two-member delegation from the Turkish Competition Authority comprising senior competition experts, Erdem Aygun and Salim Aydemir is on a five-day visit to Pakistan to interact with the enforcement officials of CCP and build their capacity on enforcement strategies.
In an exclusive talk with Business Recorder here on Thursday, they said the CCP in just 4 years under the new law worked professionally and taken a number of decisions against cartels and other anti-competitive practices despite several challenges, mainly the shortage of funds.
They said they were surprised to see a competition agency achieving so much in terms of law enforcement in the first four years of its existence. Referring to the enforcement orders issued by CCP, particularly those with reference to cartelisation, they said the orders are landmark decisions.
"Credit should be given to CCP for doing such a great job despite having limited resources. The small but impressive team of CCP is doing a great job. However, the agency's financial autonomy is crucial to enable it to continue the good work," they opined. They said that competition agencies tend to have large teams, especially in the enforcement and advocacy areas, whereas CCP has a very small team.
They informed that during their interaction with the CCP officials, they shared their country's experiences mainly in the area of competition law enforcement. "The purpose of our visit is to share with the CCP officials our experiences in areas such as bid rigging in public procurement and to share examples of cases of the TCA and how they were handled."
Responding to a question, Erdem Aygun said that the Turkish Competition Agency is keeping a regular liaison with CCP with the main focus on capacity building. "Both agencies benefit from their experiences by exchange of information." They said that the CCP and the TCA are co-operating in areas of mutual interest and competition related functions. "Pakistan is one of the first countries with whom we are closely cooperating to share competition related experience and practices."
Sharing their country's experiences, they informed that in their latest decisions against cartels the Turkish Competition Agency has imposed fine of US $180 million for cartelisation in automobile industry whereby 15 leading car manufacturers were involved in cartelisation.
"This is the highest fine ever imposed by the TCA in any cartelisation case. The investigation conducted by the TCA proved cartelisation by the automobile industry." In another such big case, the TCA has recently imposed fine of more than US $45 million on banks for indulging in cartelisation. There were seven banks were involved in cartelisation.
About the mode of collection of fine in Turkey, they informed that Turkish competition law has a unique provision which empowers TCA to collect the fine imposed on companies involved in cartelisation even if they appealed in the courts. "Moving the courts does not stop the Agency from recovery of fines", they added. According to Article-55 of the Turkish Competition Law, 'appealing against the decisions of the Board shall not cease the implementation of the decisions, and the follow up and the collection of administrative fines".
To a question on financial autonomy of the TCA, they said that the TCA is totally an autonomous body with ample funds for carrying out their functions under their Act No 4054 of the Protection of the Commission. The Turkish government has allocated enough budgets for the TCA without interference in the working of the Commission.
Due to the financial and operational autonomy, the quasi-judicial body has been able to break cartels in major sectors like automobile and banking due to availability of enough funds. The Parliament has approved the TCA's competition law, but we are totally working independently.
The government has never hindered the smooth functioning of the commission. "We do not directly report to the Parliament, but we have to report to the concerned Ministry under which the TCA is working. However, the annual budget of the TCA has been approved by the Parliament," they commented.
When asked about any pressure from law makers/politicians, Salim Aydemir confidently stated that during his 10 years of working with the TCA, there has been no pressure from the politicians/policy markers, which further strengthened the autonomy of the commission. We have never seen any pressure from our superiors which enabled the TCA to work independently.
About training of officials, Salim Aydemir stated that capacity building of their officials is the top priority of the TCA. The newly appointed officials have to go through a six month intensive training program. "We send our staff to other countries for training on competition laws. Moreover, the TCA invites international experts from other agencies to train their staff on different areas of competition regime and best practices applicable globally."
To a question on powers to check price hike, Erdem Aygun explained that the TCA can check price hike linked to the collusive behaviour of sectors/companies. There are many factors responsible for price hike and it is not necessary that every time price hike is due to collusive behaviour.
It is important to mention that Erdem holds an economics degree plus a law and economics master's degree from Bilkent University and also a PhD candidate. He has contributed to papers involving bid-rigging and design of public tenders. Salim holds a double major in economics and mathematics as well as a law degree, plus a master's degree in economics from Tilburg University. They are also experienced and able case-handlers.