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Competition Law Part 6

There are also other general and special laws that prohibit and provide for the consequences of acts in restraint of trade. In particular, Art. 186 of The Revised Penal Code punishes monopolies and combinations in restraint of trade:

The revised Penal Code imposes a penalty of imprisonment or a fine or both upon:


Any person who enter into any contract or agreement, or takes part in any conspiracy or combination in the form of a trust or otherwise, in restraint of trade or commerce or to prevent by artificial means free competition in the market.


Any person who monopolises any merchandise or object of trade or commerce, or combines with any other person or persons to monopolise that merchandise or object in order to alter price by spreading false rumour or making use of any other artifice to restrain free competition in the market.


Any person who, being a manufacturer, producer, processor of any merchandise or object of commerce from any foreign country, either as principal or agent, wholesaler or retailer, combines, conspires, or agrees in any manner with any person likewise engaged in the manufacture, production, processing, assembling or importation of such merchandise or object of commerce or with any other persons not so similarly engaged for the purpose of making transactions prejudicial to lawful commerce, or of increasing the market price in any part of the Philippines, of any such merchandise or object of commerce manufactured, produced, processed, assembled in or imported into the Philippines, or of any article in the manufacture of which such manufactured, produced, processed, assembled, or imported merchandised or object of commerce is used.

If the offence affects any food substance, motor fuel or lubricants or other articles of prime necessity, the maximum penalty will be imposed. In addition, the object of any of the above contacts will be subject to forfeiture by the government. When the offence is committed by a corporation, the directors or managers of the corporation of the agent or representative in the Philippines, in the case of a foreign corporation, who knowingly permitted or failed to prevent the commission of such offences, will be held liable as principals.

The Penal Code gives a right of action to any person who suffers damage as a result of any act by any person involving unfair competition in agricultural, industrial or commercial enterprises or in labour, through the use of intimidation, force, deceit, machination or any other unjust, oppressive or highhanded method. Art. 188 of the Code punishes the substitution and alteration of marks and trade names, and Art. 189 of the Code provides criminal sanctions for unfair competition; fraudulent registration of marks or trade names; fraudulent designation of origin; and false description. Furthermore, Secs. 29 and 30 of the Trademark Law provides civil remedies against unfair competition, false designation of origin and false description. Also The Business Names Law Act(12) punishes certain acts where no proper registration of the firm or business name or style is effected with the Department of Trade or Industry. The Republic Act No. 623 (1951) prohibits certain acts if performed without the written consent of the manufacturers, bottlers, or sellers of duly stamped or marked bottles, boxes, kegs, barrels and other similar containers.

There are also special laws that regulate monopolies. Among them is Press Decree No. 576-A, which prohibits the ownership by one person or corporation of more than one radio or television station in one municipality or city, or of more than five AM and five FM radio stations or of more than five television stations in the country. Any violation is punishable by imprisonment or a fine or both, and will result in the cancellation of the franchise and the confiscation of the station and its facilities without compensation. The Price Act 1992 (Republic Act No. 7581) imposes a penalty of imprisonment and a fine upon persons habitually engaged in the production, manufacture, importation, storage, transport, distribution, sale or other methods of disposition of goods, who shall organise a cartel(13). When a violation is committed by a corporation, its officials or employees, or in the case of a foreign corporation or association, its agent or representative in the Philippines who is responsible for the violation, shall be held liable. Alien offenders shall, upon conviction and after service of sentence, be immediately deported without need for any further proceedings.

Part 7


(12) Act No. 3883 (1931).

(13)  The Price Act defines a cartel as a combination of or agreement between two or more persons engaged in the production, manufacture, processing, storage, supply, distribution, marketing, sale or disposition of any basic necessity or prime commodity designed to artificially and unreasonably increase or manipulate its price. There shall be prima facie evidence of engaging in a cartel whenever two or more persons or business enterprises, competing for the same market and dealing in the same basic necessity or prime commodity, perform uniform or complementary acts among themselves which tend to bring about artificial and unreasonable increase in the price of any basic necessity or prime commodity or when they simultaneously and unreasonably increase prices on their competing products thereby lessening competition among themselves.