Control of Restrictive Business Practices

The relevant provisions of the set of Multilaterally Agreed Equitable Principles and Rules of the Control of RBP adopted by the General Assembly of UN should apply in the field of restrictive business practice of TNCs (Art. 35).

Taking into account the interests of all countries, particularly those of developing countries, the Set of Multilaterally Agreed Equitable Principles and Rules are framed in order to achieve the following objectives:

  1. To ensure that RBP do not impede or negate the realization of benefits that should arise from the liberalization of tariff and non-tariff barriers affecting world trade, particularly those affecting the trade and development of developing countries;
  2. To attain greater efficiency in international trade and development, particularly that of developing countries;
  3. To protect and promote social welfare in the interests of consumers in both developed and developing countries;
  4. To eliminate the disadvantages to trade and development which may result from the RBP of transnational corporations;
  5. To provide a Set of Multilaterally Agreed Equitable Principles and Rules for the Control of Restrictive Business.

Definitions

“RBP” means acts or behaviours of enterprises which, through an abuse or acquisition and abuse of a dominant position of market power, limit access to markets or otherwise unduly restrain competition, having or being likely to have adverse effects on international trade, particularly that of developing countries, and on the economic development of these countries, or which through formal, informal, written or unwritten agreements or arrangements among enterprises, have the same impact.

General principles

  1. Appropriate action should be taken in a mutually reinforcing manner at national, regional and international levels to eliminate, or effectively deal with, RBP;
  2. Collaboration between Governments at bilateral and multilateral levels should be established.
  3. Appropriate mechanisms should be devised at the international level and/or the use of existing international machinery with respect to RBP.
  4. Appropriate means should be devised for multilateral consultations with regard to RBP.
  5. The provisions of the Set of Principles and Rules should not be construed as justifying conduct by enterprises which are unlawful under applicable national or regional legislation.

Relevant factors in the application of the Set of Principles and Rules

  1. In order to ensure the fair and equitable application of the Set of Principles and Rules, States should take due account of which the conduct of enterprises, is accepted under applicable regulations should be clearly defined and publicly and readily available of RBP.

Preferential or differential treatment for developing countries

  1. In order to ensure the equitable application of the Set of Principles and Rules, States should take into account in their control of RBP the development, financial and trade needs of developing countries in application of RBP..

Principles and Rules for enterprises, including TNCs

  1. Enterprises should conform to the RBP laws and the provisions at host-countries and this should be subject to the competence of the enforcement of law.
  2. Enterprises should consult and co-operate with competent authorities of countries which are directly affected in controlling RBP.
  3. Enterprises should refrain from the following acts or behaviour in a relevant market when, through an abuse or acquisition.

 

 Principles and Rules for States at National level

  1. States should, at the national level or through regional groupings, adopt, improve and effectively enforce appropriate legislation.
  2. States should base their legislation primarily on the principle of eliminating or effectively dealing with acts or behavior.
  3. States, in their control of RBP, should ensure treatment on equitable bases.
  4. States should seek appropriate remedial or preventive measures to prevent and/or control the use of RBP.
  5. Where a State obtains information from enterprises containing legitimate business secrets, it should accord such information reasonable safeguards normally applicable in this field, particularly to protect its confidentiality.
  6. States should improve procedures for obtaining information from enterprises of TNCs, for effective control or RBP.
  7. States should establish appropriate mechanisms at the regional and subregional levels to promote exchange of information on RBP.

 

International measures

Collaboration at the international level should aim at eliminating or effectively dealing with RBP:

  1. Work aimed at achieving common approaches in national policies relating to RBP compatible with the Set of Principles and Rules.
  2. Communication annually to the Secretary-General of UNCTAD of appropriate information on steps taken by states concerning RBP.
  3. Continued publication annually by UNCTAD of a report on developments in RBP legislation.

 Consultations:

a)   Where a State believes that a consultation with another State is appropriate to an issue concerning control of RBP, it may request a consultation.

b)  States should accord full consideration to requests for consultations.

c)   If the States involved so agree, a joint report on the consultations and their results should be prepared by the States with the assistance of the UNCTAD secretariat.

International Institutional Machinery

Institutional arrangements

An Intergovernmental Group of Experts on RBP operating within the framework of a Committee of UNCTAD will provide the institutional machinery. States which have accepted the Set of Principles and Rules should take appropriate steps at the national or regional levels to meet their commitment to the Set of Principles and Rules.

The Intergovernmental Group shall have the following functions:

  • To provide a forum and modalities for multilateral consultations, discussion and  exchange of views
  • To undertake and disseminate periodically studies and research on RBP
  • To submit report at least once in a year on its work.

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