Competition policy is the cornerstone of economic governance, alongside fiscal policy, monetary policy, and trade policy aligned with industrial policy. Competition law is an important instrument of national economic policy. The competition commission is not a court but a research organisation to promote economic activities. It will give advisory services to the regulators to prevent anti-competitive activities.
The competition law of Bangladesh was drafted and passed in Parliament when the concept was new to the nation. After a decade, the law needs an updated amendment. The government prepared a draft amendment to the Bangladesh Competition Act 2012 and posted it on the website of the Ministry of Commerce, inviting public opinion. The current amendment process provides a timely opportunity to establish a balanced competition framework that supports economic growth without compromising market discipline.
SMEs contribute to employment generation, entrepreneurship, regional development, export diversification and supply-chain resilience. However, they often face disadvantages in accessing finance, technology, distribution networks and bargaining power against large enterprises. Appropriate cooperation among smaller businesses can help them share infrastructure, undertake research, reduce transaction costs, improve product quality and access domestic, regional and global markets.
International experience offers valuable lessons. The Australian Competition and Consumer Commission provides a class exemption framework for eligible small-business collective bargaining, helping smaller enterprises negotiate with larger suppliers and customers. In South Africa, the Block Exemption Regulations for Small, Micro and Medium-Sized Businesses, 2024 facilitate specified forms of cooperation, including joint purchasing, production, research and development, and collective negotiations. The objective is not to punish big enterprises for success, but to prevent economic power from becoming a barrier to others’ success.
However, SME status must not provide immunity for price-fixing, bid-rigging, market allocation or other harmful collusion. Eligibility criteria, market-share thresholds, transparency, periodic review and withdrawal powers should therefore accompany any exemption.
Competition cases involve complex legal and economic assessments. Businesses should have meaningful opportunities to challenge potentially erroneous decisions. The draft proposed a rigid mandatory deposit of 10% for review of the decision of BCC and 25% for appeal before the proposed Competition Appellate Tribunal. The decision of BCC is not final and absolute. Such mandatory deposits may create financial barriers to challenging administrative decisions, raising concerns under Articles 27 and 31 of the Constitution of Bangladesh. Such penalties and mandatory deposits may disproportionately affect SMEs and financially constrained businesses. These requirements may discourage legitimate appeals, restrict working capital and adversely affect investor confidence.
A block exemption is a legal mechanism that exempts a defined category of agreements from the ordinary prohibition on anti-competitive agreements, provided specified conditions are satisfied. Singapore’s Competition Act and the European Union’s Article 101(3) framework provide relevant models for conditional exemptions supporting economic efficiencies.
The amendment should introduce block exemptions for qualifying joint purchasing, shared logistics, research and development, technology adoption, export promotion and collective bargaining. Such provisions would improve legal certainty, reduce compliance costs and allow the Bangladesh Competition Commission to concentrate on serious anti-competitive conduct. The Ministry of Commerce should incorporate a statutory mechanism for block exemptions in the proposed amendment, supported by detailed regulations and consultation with stakeholders.
Bangladesh’s July 2024 internet shutdown illustrates the potential scale of economic disruption. The Foreign Investors’ Chamber of Commerce and Industry (FICCI) estimated that the shutdown and associated disruptions caused economic losses exceeding US$10 billion. Such losses underscore the importance of effective legal remedies, although compensation under competition law would require proof of a relevant infringement, causation and actual loss.
The absence of an express mechanism for private damages claims and collective redress may discourage affected consumers and businesses from pursuing compensation, particularly when individual losses are too small to justify separate litigation. A dedicated statutory framework would improve access to justice, strengthen deterrence and ensure that proven competition-law infringements do not leave affected parties without meaningful remedies.
Some international court decisions and precedents on the right to collective proceedings for compensation have been established. In the European Union, in Courage Ltd v Crehan (Case C-453/99, 2001), the Court of Justice recognised the right to claim damages for loss caused by competition-law infringements. In the UK case of Mastercard v Merricks [2020] UKSC 51, the Supreme Court clarified the legal framework for collective proceedings seeking compensation on behalf of consumers allegedly harmed by anti-competitive conduct.
In United States the USA v Apple Inc, the antitrust proceedings concerning alleged collusion to raise e-book prices, Apple paid US$400 million in consumer compensation, contributing to total repayments of approximately US$566 million by Apple and the publishers. These examples demonstrate how individual and collective damages mechanisms can complement public enforcement and provide redress for consumers and businesses.
A new chapter entitled ‘Actions for Damages and Class’ should be incorporated into the Competition Act, 2012, drawing on UNCTAD’s Model Law and relevant international best practices. The provisions should establish the right to compensation, collective redress and procedural safeguards, etc. Chapter XIII of UNCTAD’s Model Law on Competition and Policy recommends enabling individuals, enterprises and the State, acting on behalf of affected persons, to recover losses caused by infringements of competition law, including damages, costs and interest. It also recognizes the importance of individual and collective actions in providing effective remedies. Authorities should take note of UNCTAD’s model law.
The definition of a Down Raid is an unannounced competition inspection intended to secure evidence before it can be concealed, altered or destroyed. It describes the investigative operation, including its surprise nature, timing and coordinated execution. Search means the legally authorised examination of specified premises, records, devices or other material to locate evidence of a suspected infringement. Seizure means taking lawful possession or control of identified evidence for investigative or evidentiary purposes. Both must be subject to legal authorisation, defined scope and appropriate safeguards.
A carefully designed framework would help align competition policy with Bangladesh’s employment, investment, productivity and export-diversification objectives. Rather than weakening competition law, SME provisions and conditional block exemptions would make it more proportionate, development-oriented and responsive to Bangladesh’s economic priorities.
Competition regulation combines economics, law, business, international trade, socioeconomic conditions, SMEs, e-commerce, ICT, artificial intelligence, digital markets and sustainable development. Effective leadership requires extensive knowledge, experience and sound judgment. The proposal to increase the maximum age limit to 67 years or, preferably, removal is appreciable. Most countries have no such age limit for the commission.
The proposed amendment should incorporate these provisions into the legislative revision in question and thereby give effect to the commitment communicated to UNCTAD. The amendment to the Competition Act, 2012 should be recognised as a strategic economic reform, not merely a legislative update. It must prevent the abuse of market power, protect consumers, promote fair business opportunities, correct market failures, reduce monopoly-induced deadweight losses, and ensure the efficient allocation of resources.
Ultimately, a strong competition regime makes the rule of law an economic principle of no privilege over competition, no power above accountability, and no growth at the expense of public interest.
The views expressed in this article are solely those of the author
The writer is the CEO, Bangla Chemical & Legal Economist. E-mail: [email protected]
