Peer reviews of competition law and policy are a valuable tool to reform and strengthen a country’s competition framework. This peer review of Thailand presents the evolution of its competition regime over the last few years and assesses the effectiveness of its current competition law and policy. It provides recommendations to help Thailand strengthen its competition regime and institutions, developed and discussed at the peer review examination carried out during the 2024 Global Forum on Competition.
OECD Peer Reviews of Competition Law and Policy: Thailand
Competition Law and Policy Reviews
Abstract
Executive Summary
This report results from the Peer Review of the Thailand’s competition law and policy. It presents the main findings of the current panorama of competition law and policy in Thailand and concludes with recommendations developed by the lead examiners and discussed at the Peer Review examination, carried out during the 2024 OECD Global Forum on Competition.
In 2017, Thailand adopted a new Trade Competition Act, establishing an independent competition authority, the Trade Competition Commission of Thailand (TCCT), and covering the traditional areas of competition law. However, institutions empowered to enforce competition law, in particular the TCCT, face significant challenges related to budget and human resources. The Trade Competition Act excludes certain operations from its scope of application, including State-owned enterprises and regulated sectors under specific circumstances. Moreover, hard-core cartels and abuse of dominance are exclusively subject to a criminal procedure, which makes it challenging to gather sufficient evidence to establish cases. In addition, Thailand has both ex-ante and ex-post merger control regimes, with different notification thresholds. However, the TCCT can only intervene in the ex-ante regime, having no powers in the ex-post system, even when mergers are deemed anti-competitive.
Competition enforcement remains incipient in Thailand. While the OECD was unable to obtain consistent information on the total number of infringement cases, it confirmed that the number is low. The TCCT has reviewed 12 mergers under the ex-ante regime and imposed behavioural remedies in three of these cases. Furthermore, competition advocacy continues to be a challenge, despite the TCCT’s efforts to promote competition in Thailand.
The recommendations relate to the institutional and legal framework, competition law enforcement, as well as competition advocacy and institutional co-operation. They suggest possible ways forward for consideration by Thailand, with the aim of improving the country’s competition law and policy.
Scope of application
Ensure that equivalent competition law rules apply to enterprises irrespective of their ownership, location or legal form, in particular that:
SOEs performing economic activities are subject to competition law.
All entities engaged in economic activities, including not-for-profit organisations, associations of firms and holding companies, are subject to competition law.
Competition law applies extraterritorially to business practices outside Thailand that produce effects within the country.
Adopt a general competition legal framework, including both substantive and procedural rules, that uniformly applies across all sectors. In addition, clarify which entities are responsible for the enforcement of competition law in the different sectors (i.e. TCCT or sector regulators).
Budget, human resources and institutional set-up
Reallocate TCCT resources by reorganising its institutional structure and increasing the resources dedicated to competition enforcement.
Ensure that TCCT’s budget is at least at the level of comparable jurisdictions.
Consider abolishing the sub-committees of inquiry, ensuring that investigations are conducted solely by TCCT staff.
Transparency and procedural fairness
Publish the facts (including the name of the parties), legal basis and sanctions relating to all decisions, subject to the protection of confidential information.
Provide clear procedural rules for all investigations against anti-competitive behaviour, specifying what the investigated parties must be informed about and in what stage. This should include the factual and legal basis, the competition concerns and the relevant evidence collected by or submitted to the TCCT, subject to the protection of confidentiality and privileged information.
In merger cases, establish clear procedural rules to guarantee that merging parties have the opportunity to obtain sufficient and timely information about competitive concerns raised by a merger and a meaningful opportunity to respond to such concerns.
Anti-competitive behaviour
Increase enforcement actions against cartel and abuse of dominance cases.
Enable hard-core cartels and abuse of dominance to be sanctioned as administrative infringements by the TCCT.
Make hard-core cartels illegal regardless of the existence of proof of actual adverse effects on markets.
Clarify that the TCCT can enforce the legal provision against bid rigging in public procurement.
When assessing abuse of dominance, focus on the impact of the behaviour on competition.
Merger control
Streamline the merger review regime, in particular:
Consider reviewing the necessity for having both ex-ante and ex-post merger control regimes, taking into account their associated costs and benefits.
Ensure the TCCT has effective powers to review transactions and, if needed, prohibit them or authorise them subject to remedies.
Ensure that merger notification thresholds are clear and do not relate to the competition assessment. For this purpose, the creation of a monopoly or a dominant position, as well as the substantial lessening of competition should not be used as notification thresholds.
Establish local nexus criteria, such as local turnover, within the merger notification thresholds.
Reduce the current numerical levels of merger notification thresholds, taking into account, among other elements, the size of the Thai economy and of most companies operating in the country, the average number of transactions that can be effectively reviewed and the experience of other similarly situated jurisdictions. In addition, threshold levels should be subject to periodic review to reflect the changes in the economic context in Thailand.
Establish a clear substantive test for reviewing mergers that relies on the substantial lessening of competition, in addition to a test based on the impact on market structure.
Allow third parties with legitimate interest in the merger under review to have an opportunity to express their views during the merger review process.
Advocacy and promotion of competition
Provide advocacy opinions to the Ministry of Commerce, the Cabinet and government agencies on policies and regulations that unduly restrict competition.
Empower the TCCT to submit advocacy opinions to Parliament and Ministries other than the Ministry of Commerce.
