What Is an “Effective” Asean Competition Law? A Methodological Note

Abstract

ASEAN is currently reviewing its competition laws with “the difficult task of operationalizing the term effectiveness.” But the review seems more concerned with achieving international best practice rather than promoting effective economic outcomes that are based on local economic and institutional conditions and Asian business practices. There has been minimal input from ASEAN economists in the development and administration of ASEAN competition laws. Instead, ASEAN competition laws are mainly shaped and administered by lawyers who are more concerned with international comparisons of administrable laws, system administration and procedures and not so much with either local economic conditions or the ability of local competition regulators to achieve good economic outcomes. There is an extensive business school literature that shows that Asian business operates differently from those in the West. But these differences are not recognized in the design and operation of ASEAN competition laws. This paper first, reviews how economics can contribute to both the design and implementation of effective ASEAN competition laws that take into account differences in business practices, economic conditions and institutional capacities. Second, because competition laws are mainly designed and run by lawyers, the paper also examines how lawyers perceive and research the transfer of legal rules from one country to another. This provides a guide to economists interested in research on the law and economics of competition law within ASEAN. The authors hope that it will stimulate both economists (and lawyers interested in economics) to undertake practical empirical research that will enhance the effectiveness of ASEAN competition laws and their possible convergence.