Code for self-regulation of competition introduced

A Voluntary Competition Compliance Code was introduced to promote individuals to correct their own violations.

ISLAMABAD: A Voluntary Competition Compliance Code (VCCC) has been introduced to promote organisations and individuals to correct their own violations, if any, of competition law. It has been approved and introduced by the Competition Commission of Pakistan (CCP) as a self-correcting mechanism.

The theme of the VCCC is to make markets competitive for undertakings and consumers, by encouraging business undertakings to establish an internal framework for compliance.

The incentives for adoption of the VCCC include lenient treatment, reduction in penalties and burden of costs, promoting goodwill and providing a competitive edge to the undertakings. Registration entails the undertaking’s name appearing on the Commission’s website and issuance of a registration number by the CCP.

The approach taken by CCP in respect of the VCCC differs from other jurisdictions in that it provides an opportunity to undertakings for voluntary adoption of the code as distinct from undertakings developing their own compliance code.

The code has been developed by CCP with the object of creating awareness among undertakings about the competition law and policy in Pakistan, to encourage compliance with the ordinance and to prevent violations under law.

The VCCC sets out the objective, importance and incentives for its adoption. VCCC provides an overview of the functions and powers available to CCP, the practices that are prohibited under the ordinance and the risks associated with non-compliance with the provisions of the ordinance. It also includes the monitoring, auditing, reporting and registration requirements.

The elements of VCCC provide for assessment of risk, establishment and implementation of compliance policy, commitment from senior management, appointment of compliance officers, training and education of employees, dissemination of compliance policy among employees, consequences of non-compliance by employees and evaluation of adoption and implementation of the VCCC.

The draft VCCC – Statement of Principles & Policy was circulated among members of the Competition Consultative Group (CCG) in a meeting held on February 24 in Lahore, for their feedback.

The VCCC has been placed on the website of CCP for its voluntary adoption by the undertakings. The Commission through its in-house resources and expertise developed the VCCC in February 2010 after in-depth review of the guidelines provided in this regard by US, UK, Canada, India and Singapore.

Published in The Express Tribune, July 23^rd, 2010.