./.WORLD TRADE
ORGANIZATIONWT/WGTCP/W/179
10 September 2001
(01-4238)
Working Group on the Interaction
between Trade and Competition PolicyOriginal:  English
COMMUNICATION FROM TRINIDAD AND TOBAGO
The following communication, dated 16 August 2001, has been received from the Permanent
Mission of the Republic of Trinidad and Tobago, with the request that it be circulated to Members.  Itsets out a number of points that were made by the delegation of Trinidad and Tobago in the Working
Group's meeting of 5-6 July 2001.
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Progressivity and Flexibility in Developing a Competition Regime
The papers submitted to the Working Group on the Interaction between Trade and
Competition Policy by the European Community and its member States (document
WT/WGTCP/W/175) and Canada (document WT/WGTCP/W/174) contain two concepts of particular
interest to developing countries in general, and to small economies in particular.  These concepts are
flexibility and progressivity.
For Trinidad and Tobago, a small economy, flexibility in developing a competition regime
refers to the substance of the competition law that a country embraces.  It is the ability of a country tochoose from the menu of prohibitions contained in competition law, those aspects that are relevant for
the particular economy, given its market structure, level of development, the types of anti-competitive
conduct that are prevalent and special characteristics.  This means that some aspects of competition
law may either not be relevant for that economy, or may have to be tempered to complement the
government's development (industrial) policy, through the use of exemptions and exclusions.  This isvery important for small economies whose market structure and nature of economic development are
very different from industrialized countries where competition law emerged.
To provide an example, a small open economy may not need merger control regulation at all,
given that the size of firms may be too small to pose a threat, given the level of competitionintroduced by imports.  Further, the structure of the market may be able to accommodate
concentrations or may require concentrations for efficiency reasons.  Analysing mergers is a very
complex procedure and it may be a waste of resources to have merger control regulation in these
circumstances.  In another sense, a small economy may want to support its industrial policy by using
exclusions and exemptions in its competition law.  For instance, it may want to exclude ExclusionaryDistribution Agreements, because the peculiarities of smallness may require that a distributor does not
carry competing products.  The point is that smallness may lead to circumstances where conduct
normally deemed to be anti-competitive in a larger more complex economy, may not have
anti-competitive intentions or effects in a small open economy.WT/WGTCP/W/179
Page 2
Progressivity , in our view, refers to the approach or methodology in developing and
implementing a competition regime.  It allows for the gradual and selective introduction of
instruments to control anti-competitive behaviour.  This allows the authority, other government
departments and stakeholders the time to accommodate and adjust to the changes that are required.
Further, as economies develop, and regimes mature, the instruments could be deepened in thisapproach.  Progressivity is particularly important in small economies due to the lack of sufficient
human and financial resources to establish a competition regime for the first time.  It allows a country
time to build a firm foundation for the competition regime by fully assimilating one aspect of
competition rules before progressing to the next.
Perhaps a practical application of the concept will be instructive.  In establishing its
competition regime, a small developing country may find it more effective, in the first phase, toconcentrate its efforts on measures to address one type of anti-competitive conduct such as hardcore
cartels.  The choice of conduct addressed first should be guided by the procedures necessary for each.
For instance, addressing "abuse of dominance" involves such complex rule of reason
procedures that it may consume too many of the ec onomy's resources at such an early stage.  Instead,
the small economy could focus on consumer protection, so that consumers can gain a positive
understanding of competition law and how it works in their favour.  This approach would also allow
the personnel in a new Competition Authority the time they need to ride the learning curve.  They
could get technical training during this time, accessing technical assistance that is available, and also
do internships in more mature competition authorities.  After a critical mass of experience has beengarnered, the country is then able to introduce the more complex aspects of anti-competitive
agreements and "abuse of dominance" provisions.  At that phase, a greater degree of focus could be
given to sanctions.
In our view, new Competition Agencies should focus much more on competition advocacy
than on sanctions.  As such, the cases that they do investigate should be those that they can easily deal
with (and that they could win), so that their authority could be established.  This gradualist approach
allows for:  (i) the phased introduction of the components of competition law;  and (ii) the
development of an appropriate mix of strategies that will enable the generation of support and respect
for the competition regime.  These two aspects are of critical importance to the success of any
competition regime.
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