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Competition Law falls on deaf ears   2009-03-17 - VietNamNet/DTCK

A recent survey showed that people and institutions have little knowledge of competition management laws.


The book introducing Competition Law

Two weeks ago, local newspapers began publishing a series of articles on the pricing policy of Honda Vietnam, which since has become a hot topic among consumers.


The stories were published in newspapers after consumers sent letters to newspapers complaining that they had to buy Honda products at prices several million VND higher than the manufacturer’s suggested retail prices (MSRP).


The Competition Administration Department (CAD) under the Ministry of Industry and Trade then requested a working session with Honda Vietnam.


The motorbike manufacturer, after meeting with CAD on February 18, committed to ask Honda Exclusive Authorised Dealers (HEAD) to sell products at MSRP and to make public its sales plan in February.


However, no changes in the prices of Honda products have been made since the meeting. No information about the number of products to be launched onto the market has been released, while HEADs are still selling products at different prices.


CAD, as the state management agency which protects consumers’ benefits, has only given a vague recommendation that consumers should keep cautious and research products well in order to avoid purchasing at high prices.


This is just one of the examples of the effectiveness of the Competition Law, which was brought into life five years ago. Prior to that, consumers were discontented with manufacturers of the Vietnam Automobile Manufacturers’ Association (VAMA) because they joined hands to raise sales prices.


The Competition Law…?


In 2008, CAD conducted a survey on the awareness of the community about the Competition Law. The survey kicked off on November 1 and finished December 31, aiming to assess the knowledge of people, businesses, associations and state management agencies on competition-related laws.


The survey was conducted in the northern, central and southern regions.


The survey found that, in general, people’s awareness of competition laws was limited to the knowledge that a law called the Competition Law did in fact exist.


The polled subjects had basic knowledge of unhealthy competition activities. However, the number of businesses which have good knowledge of the law, like fines and procedures for initiating lawsuits, remains modest.


The fact that the Competition Law has been ignored shows the weakness of Vietnam’s business environment. Nguyen Dinh Cung, Head of the Macroeconomic Studies Division under the Central Institute of Economic Management, said that the poor enforcement of laws has been mentioned in many forums about Vietnam’s business environment, but the problems have not been settled.


Even the Enterprise Law, a basic law that regulates the operations of enterprises, is also violated regularly, while in many cases, state management agencies cannot punish the violators because of a lack of regulations.

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