Sky-high livestock prices may breach competition law

Although many livestock companies could face an inspection to ensure they follow through on commitments to cut their prices, the market outlook still looks dreary in spite of the government’s call to stabilise the selling cost of live pigs.

Sky-high livestock prices may breach competition law

The Ministry of Industry and Trade wants to see stabilisation of the selling price of live pigs in order to avoid unfair competition.

At a recent seminar on the situation, Cao Xuan Quang, head of the Consumer Protection Division at the Vietnam Competition and Consumer Protection Authority (VCCA), stated that the hike in pork prices has created difficulties for consumers.

Amid the COVID-19 pandemic, the competition agency of Vietnam has already drawn attention to the issue, and the VCCA is gathering information to learn about the collective increase of the price offered by husbandry companies across the country.

Although the high price of pork was previously attributed in part to African swine fever, there has been increasing scepticism that some companies have been taking advantage of their dominant position to exploit consumers by charging irrationally high prices for live hogs. It suggests a potential breach of Article 27 under Vietnam’s Law on Competition.

The total number of pigs slaughtered by the 15 largest enterprises accounts for 35-40 per cent of the total supply, while the rest comes from local farms and households.

 

Pursuant to the Law on Competition, an enterprise is deemed to hold a dominant market position when it has substantial market power or has 30 per cent or more of the market share in the relevant market.

The substantial market, known as the ability of a company to raise price profitably above the competitive level, is determined by a variety of factors, including market shares in the relevant market; financial strength and size; barriers to market entry and expansion to other enterprises; ability to obtain, assess, and control the goods distribution and consumption market or sources of supply; advantages in technology and technical infrastructure; right to own, obtain, and assess infrastructure; right to own or use subject matters of intellectual property; and ability to transfer to other sources of supply or demand associated with other goods and related services.

A breach of Article 27 of the Law on Competition by engaging in prohibited acts of abuse of dominant position would see the violator given a fine ranging from 1 to 10 per cent of their total turnover earned from the relevant market in the financial year preceding the year in which the violation is committed.

In addition, the profits illegally obtained from the violation of the enterprise engaged in the prohibited conduct also may be confiscated. The company that abuses its dominant position may also be forced to carry out restructuring.

Violators of the Law on Competition, depending on the nature and seriousness of the violation, can be prosecuted for criminal liability. Under the Penal Code, criminal penalties in the field of competition include fines of up to VND3 billion ($130,000) and a term of imprisonment of up to five years. Additionally, if loss or damage is caused to other parties, compensation must be paid. VIR

Tieu Quang Khanh

  • Tags :
 
 

Other News

.
Probus Opportunities & Digi Ventures invest in Vietmoney
Probus Opportunities & Digi Ventures invest in Vietmoney
BUSINESSicon  10/09/2020 

Vietnamese pawn chain operator Vietmoney has closed its series A funding round with Probus Opportunities (Probus) and Digi Ventures (DV). Probus and DV will hold a combined 30% stake in Vietmoney and both shall join the Board of Directors.

Vietnam needs US$8-10 billion for electricity investment annually
Vietnam needs US$8-10 billion for electricity investment annually
BUSINESSicon  08/09/2020 

Given the increasing demand for electricity, Vietnam needs US$8-10 billion for electricity investment annually, Minister of Industry and Trade Tran Tuan Anh said at a meeting on Monday, September 7.

Investors still pouring money into corporate bonds, despite warnings
Investors still pouring money into corporate bonds, despite warnings
BUSINESSicon  09/09/2020 

Investors are still preferring corporate bonds to bank deposits, and are withdrawing money from banks to buy corporate bonds to enjoy higher interest rates.

Thu Duc City set to be new growth pole for HCM City
Thu Duc City set to be new growth pole for HCM City
BUSINESSicon  09/09/2020 

Like Gangnam south of the Han River in Seoul and Pudong east of the Huangpu River in Shanghai, Thu Duc City is expected to become a new growth area for HCM City.

Nam Dinh-based Rang Dong Textile Industrial Park sign land lease contracts with foreign firms
Nam Dinh-based Rang Dong Textile Industrial Park sign land lease contracts with foreign firms
BUSINESSicon  08/09/2020 

The signing ceremony of a land lease contract and land delivery for factory construction between Cat Tuong Real Estate Group, Top Textile Co., Ltd and Jehong Textile Viet Nam Co, Ltd took place on September 4.

Ministry proposes overhaul of investment framework for power projects
Ministry proposes overhaul of investment framework for power projects
BUSINESSicon  08/09/2020 

The National Assembly's economic committee held a hearing on the development of Vietnam's energy sector until 2030 yesterday.

Mooncake producers begin selling well before Mid-Autumn Festival
Mooncake producers begin selling well before Mid-Autumn Festival
BUSINESSicon  08/09/2020 

The Mid-Autumn Festival is a time for mooncakes, a baked pastry that symbolises family reunions and which is traditionally consumed as part of the...

Vietnam to face power shortages
Vietnam to face power shortages
BUSINESSicon  08/09/2020 

Vietnam would face the risk of power shortages from 2021-25 due to slow progress at many large power projects both in the northern and southern...

Biggest business stories: August 31 to Sep 6
Biggest business stories: August 31 to Sep 6
BUSINESSicon  08/09/2020 

Big changes were made with the key personnel of Quoc Cuong Gia Lai Group, while the president of Hoang Anh Gia Lai Group, Doan Nguyen Duc, has not been able to escape difficulties despite his efforts to sell assets to pay debts.

Multi-trillion VND helps VN-Index regain peak
Multi-trillion VND helps VN-Index regain peak
BUSINESSicon  07/09/2020 

The strong cash flow to the stock market in recent days has helped stock prices bounce back.

10,000 businesses dissolved, thousands of others in danger
10,000 businesses dissolved, thousands of others in danger
BUSINESSicon  09/09/2020 

Amid the impact of COVID-19, as many as 10,400 businesses completed procedures for dissolution in the first eight months of the year.

Online shopping sees record growth, ranked 3rd in region
Online shopping sees record growth, ranked 3rd in region
BUSINESSicon  08/09/2020 

The total number of visits to online shopping apps in Vietnam reached 12.7 billion in the first six months of the year, the highest ever figure.

Vietnamese rice takes bite out of global market
Vietnamese rice takes bite out of global market
BUSINESSicon  07/09/2020 

Vietnam’s rice exports have expanded during the pandemic to surpass rival Thailand in price for the first time in three decades, leading experts to suggest the sector should consolidate its position.

Plastics industry shrugs off pandemic, interests stock investors
Plastics industry shrugs off pandemic, interests stock investors
BUSINESSicon  07/09/2020 

The new wave of Covid-19 infections has caused heavy pressure on the country’s economy. 

EU competition in redrawn public procurement landscape
EU competition in redrawn public procurement landscape
BUSINESSicon  07/09/2020 

Competition in Vietnam’s government procurement market is expected to heat up with the involvement of EU contractors, driven by the country’s highest-ever market-opening commitment in this field. 

Alibaba.com rolls out export-focused program for Vietnamese SMEs
Alibaba.com rolls out export-focused program for Vietnamese SMEs
BUSINESSicon  07/09/2020 

Alibaba.com, the global business-to-business (B2B) e-commerce platform of Alibaba Group, has launched a landmark initiative to help businesses in Vietnam go online and reach an enormous pool of qualified global buyers.

Profit taking to weigh on local market, but September may be bright
Profit taking to weigh on local market, but September may be bright
BUSINESSicon  07/09/2020 

Vietnam’s stock market rally may slow this week as investors eye profits but the one-month projection is still optimistic.

E-commerce gives impetus to woodworking sector
E-commerce gives impetus to woodworking sector
BUSINESSicon  06/09/2020 

In the rapid development of e-commerce, online stores and factories are one of the solutions with which enterprises can cope with the prolonged Covid-19 pandemic while laying a foundation for digitalized business

Key public investment projects gather speed
Key public investment projects gather speed
BUSINESSicon  07/09/2020 

Amid the government’s rush to push up public investment as one of the key pillars for economic growth, numerous projects have been accelerating their progress to match the plan set forth, 

VIETNAM'S BUSINESS NEWS HEADLINES SEPTEMBER 8
VIETNAM'S BUSINESS NEWS HEADLINES SEPTEMBER 8
BUSINESSicon  08/09/2020 

Solar power developers acquire massive profit in short time

 
 
 
Leave your comment on an article

OR QUICK LOGIN