The 2017 – 2018 Competition Advocacy Contest: Closing the gap through competition advocacy: microeconomic policies, macroeconomic implications

Competition agencies and public bodies promoting competition policy are welcome to apply. We encourage joint submissions with other governmental bodies or non-governmental organizations.

Submitted stories should include:

• Description of the competition/market problem
• Relevant theme
• Main goal/s of the work undertaken
• Sector/s involved and product/service analyzed
• Geographical regions affected
• Importance of the sector/market analyzed
• Resources mobilized
• Collaboration with other agencies/organizations and stakeholders
• Advocacy strategy
• Specific advocacy activities, milestones and timeframe
• Main messages and recommendations conveyed by the advocacy activity
• Results achieved
• Effects on market (e.g., consumer savings, investment, value added, entry of new firms)
• Impact evaluation, if any
• Lessons learned
• ICN or World Bank Group tools used for this initiative, if any

Stories submitted to previous editions of this contest that were not awarded are eligible for resubmission.

Apply online

Please contact Guilherme de Aguiar Falco with any questions at gfalco@worldbank.org.

The deadline for submissions is January 15^th, 2018 (11h59 pm, Washington D.C. time

Submissions will undergo a rigorous assessment of the following criteria:

• Success of the advocacy activity
• Cooperation mechanisms deployed
• Advocacy strategy
• Results achieved
• Impact  and effects on markets
• Creativity and originality
• Spillover effects and lessons learned

A panel will review the submissions and select the top stories.

Winning applicants will be invited to present their stories at a joint ICN-World Bank Group event, and winning stories will be featured in an ICN-World Bank Group Publication.

Winners and honorable mentions will be announced by February 16^th, 2018.

Apply online  before January 15^th, 2018 (11h59 pm, Washington D.C. time)

The International Competition Network (ICN) and the World Bank Group (WBG) are pleased to announce the winners of the 2017-2018 Competition Advocacy Contest. By showcasing success stories of effective competition advocacy, the contest aims to raise awareness of the key role played by competition agencies, government entities and non-governmental organizations in promoting competition. The winners and honorable mentions will be invited to present their stories at the Advocacy Group Session during the ICN Annual Conference in India. The winners and honorable mentions will also be featured in a joint publication.

The winning stories as well as stories worthy of honorable mention were selected among 50 entries submitted by both government authorities and non-governmental organizations from 30 jurisdictions around the world, divided in the following themes:

• Theme 1: Prompting structural reforms in key sectors
• Theme 2: Creating Markets for private sector development
• Theme 3: Reaping the benefits of globalization and trade openness
• Theme 4: Improving administrative procedures to remove obstacles to competition

The winners and honorable mentions of the 2017-2018 Competition Advocacy Contest were selected by the following panel (in alphabetical order):

• Eleanor M. Fox, Walter J. Derenberg Professor of Trade Regulation, New York University School of Law
• Martha Martinez Licetti, Global Lead, Markets and Competition Policy, Macroeconomics, Trade and Investment Global Practice, World Bank Group
• Mariana Tavares de Araujo, Senior Partner, Levy & Salomão Advogados
• Christine Zhenwei Qiang, Practice Manager, Investment and Competition Unit, Macroeconomics, Trade and Investment Global Practice, World Bank Group

2017-2018 COMPETITION ADVOCACY CONTEST: WINNERS AND HONORABLE MENTIONS

Theme 1: Prompting structural reforms in key sectors

Both winners in this category successfully tackled critical competition barriers in sectors with significant spillover effects across the economy (education, finance and telecommunications) while working in coordination with line Ministries, Central Bank and sector regulators.  As a result, competition principles were embedded in sectoral regulations and policies.

Kenya (Winner)

The Competition Agency of Kenya (CAK), in coordination with the Central Bank and the Communications Authority, implemented system interoperability rules in the provision of Mobile Financial Services (MFS), a key feature to promote entry and prevent abuse of significant market power. This effort changed sector regulations and strategic behavior of incumbents in both financial and telecommunication sectors, benefiting more than 30 million current consumers and paving the way for further economic inclusion by removing impediments to efficient allocation of resources that encourages job creation, investment and productivity. As a result, prices for consumers have already dropped 10-fold.

United Kingdom (Winner)

The Competition and Markets Authority (CMA) has worked alongside the Department for Education ensuring that reforms to the regulation of higher education in England will encourage competition in the interest of students.  The CMA's interventions have helped ensure a level regulatory playing field for different kinds of institutions, improving the information available to students in an environment conducive to entry and innovation. CMA estimates that a realistic increase in uptake of accelerated degrees alone could yield benefits worth £25m to consumers. This effort supports the creation of a high quality and widely accessible education sector, which is a key component of economic growth, positively affecting productivity, jobs and investment.

Theme 2: Creating Markets for private sector development

Stories awarded in this category illustrate the role that competition advocacy can play in opening markets previously completely closed to the private sector through competitive market mechanisms while raising the need to complement market opening with the elimination of anticompetitive regulation that unjustifiably discriminates against certain players or provides incentives for firms not to compete on the merits.

Brazil (Winner)

The Secretary of Economic Monitoring of the Ministry of Finance (SEAE) has led a pro-competition regulatory reform to open the lottery markets for private participation, a sector under statutory public monopoly since 1962. The introduction of market competition and private participation through a competitive bidding process is expected to expand lottery revenues from 0.21% of GDP in 2016 to 1% of the GDP in 10 years, in benefit of both consumers and the country’s fiscal landscape.  This initiative also illustrates successful results of SEAE’s increasingly proactive advocacy role.

Russia (Winner)

Based on studies conducted between 2010 and 2017, The Federal Antimonopoly Service of Russia (FAS) advocated for the elimination of the most typical examples of unnecessary product specifications that restrict competition, facilitate collusion and foreclosure in the pharmaceutical procurement markets. In coordination with the Ministry of Health, Ministry of Economic Development and Ministry of Finance, FAS supported the issuance of the Federal Decree n. 1380 of 2017, which is expected to stimulate competition by promoting entry and private sector participation. Increased competition is expected to lead to lower prices, greater availability of medicines for citizens and more efficient budgetary spending.

Serbia (Honorable Mention)

Based on the results of a market inquiry, the Serbian Antitrust Authority (SAA) led a pro-competitive and industry-wide voluntary change in firm behavior in secondary markets of automotive and home appliances industries, tackling both collusive and exclusionary practices. Results of the market inquiry were directly distributed to market participants whose practices were found to be non-compliant with the competition law, leading to voluntary adoption of pro-competition strategies. This initiative simultaneously reduced litigation costs and effectively removed barriers to market participation, signaling the position of SAA to other aftermarkets and paving the way for greater market dynamics and private participation across the Serbian economy.

Theme 3: Reaping the benefits of globalization and trade openness

Stories awarded in this category illustrate the benefits of the involvement of competition authorities in the process of trade liberalization as well in the decision on trade protection measures. They highlight the need to: (i) consider the effects of trade protective measures on market competition and welfare, (ii) analyze these effects both locally and regionally and (iii) engage with trade policy makers early on in the process to inform their decision making.

Argentina (Winner)

The National Commission for the Defense of Competition (CNDC) was successful in convincing the Ministry of Production (MoP) to not impose an antidumping measure on load cells for weighing scales, a market characterized by high local market concentration and significant import contestability. By considering both price and non-price competition dimensions, a study developed by CNDC showed that the antidumping measure would lead to an increase in downstream production costs without increasing the demand for local inputs. At the end, the interaction between different government stakeholders, such as the CNDC and the National Commission of Foreign Trade (CNCE) of the MoP, has demonstrated that cooperation between agencies in the design of public policies is key to effectively promote general economic interest.

Malawi (Winner)

Under the request of the Ministry of Industry, Trade and Tourism (MITT), and in cooperation with the Common Market for Eastern and Southern Africa (COMESA) Competition Commission, the Competition and Fair-Trading Commission (CFTC) prevented the establishment of import barriers to cement that would have curtailed the benefits of recent entries of regional players in a historically concentrated and high priced local market. The inquiry found no evidence of dumping, rather observed that the foreign companies were large and benefited from economies of scale, and therefore sold their cement at relatively low prices. The CFTC used these findings to sensitize the MITT and cement producers about the need to leave the market open to imports.

European Competition Commission (Honorable Mention)

The European Competition Commission promoted an inquiry aimed at removing barriers to cross-border online trade in the European Union (EU) that led to the adoption of an EU regulation addressing geo-blocking and other forms of discrimination based on customers' nationality, place of residence or place of establishment. As a result, many companies have reviewed their commercial practices on their own initiative, and the EU's Court of Justice has already relied on the results of the inquiry for a ruling. Currently, only 15% of consumers buy online from another EU country and only 8% of companies sell cross-border within the EU. The Digital Single Market strategy has significant potential to spread the benefits of online trade across borders.

Theme 4: Improving administrative procedures to remove obstacles to competition

Stories awarded in this category highlight the importance of embedding competition principles in regulatory reform process to tackle administrative barriers that are harming competition. These stories also provide pioneering examples on: (i) how institutional changes in the advocacy mandate lead to more successful advocacy, (ii) how not only regulations but also administrative practices matter and (iii) how to engage civil society to identify regulatory obstacles to competition in a cost-effective way.

Chile (Winner)

Taking advantage of a new and more flexible advocacy mandate, the Fiscalía Nacional Económica (FNE, the Competition Agency) developed a strategy focused on building an inclusive, collaborative and non-confrontational work relationship with regulators. This strategy positioned FNE as a partner of other government entities in promoting public policy improvements, rather than a sole provider of opinions. Coming from an unsatisfactory track record of unilateral pro-competition recommendations issued by the Competition Tribunal, only in 2017, the FNE implemented three successful cases by (i) reforming  outdated calorie and nutrient standards that prevented entry in the processed baby food, (ii) reforming environmental regulations that created a monopsony and export prohibition on the market of recycled batteries, and (iii) promoting voluntary compliance by players on the mobile telecom services regarding anticompetitive bundling.

Hong Kong (Honorable Mention)

The Competition Commission worked with the Hong Kong Housing Authority (HKHA) to replace the practice of automatically renewing long term concession contracts in the provision of Piped Liquefied Petroleum Gas (LPG) only to incumbents.  This resulted in the promotion of new competitive tenders. The practice of renewing incumbent’s contracts instead of conducting bidding processes prevented entry and competition, with potential negative effects over prices and quality of services. Estimations showed that LPG prices are 3-5% lower in regions where LPG services have been recently tendered, a benefit that is now expected to reach all the 156,000 residents in 15 public rental housing estates in Hong Kong.

Mexico (Honorable Mention)

In an innovative approach on how to simultaneously save public resources, promote public awareness and gather concrete information on anticompetitive regulations, the Mexican Federal Economic Competition Commission (COFECE) launched the “Most Absurd Regulatory Obstacle to Competition Award”. Providing financial incentives to participants, and advertising the contest by e-mail, telephone, meetings, social media and radio, COFECE received 615 applications listing restrictions at the federal, state and municipal levels. In the future, this material will allow COFECE to prioritize, monitor and act on concrete restrictions across the country. Results have generated a broad public discussion and targeted reactions around the topic. This initiative used a new approach to increase engagement of non-traditional stakeholders and civil society in the implementation of competition policy.