New amending bills to the Antitrust Law

1.    Introduction

Members of the House of Representatives Patricia Vaca Narvaja and Mercedes Marcó del Pont submitted two bills (the “Amending Bills”) to Congress to amend the Argentine Antitrust Law No 25,156 (the “Antitrust Law”). One of the projects is aimed to modify article 1 of the Antitrust Law and replace the existing “general economic interest” concept with a new of “economic interest of consumers or general economic interest” (the “First Project”); and the other one set up the position of the general prosecutor for competition (the “Second Project”).

Both Amending Bills were approved by the House of Representatives on July 5 and 19, 2006, respectively, and now they have been sent to the Senate for approval.

2.    Background

The First Project (File No 431-D-2006) intends to modify article 1 of the Antitrust Law and, therefore, replace the legally protected interest of “general economic interest” with a new one of “economic interest of the consumer or general economic interest”.

The current interest protected by the Antitrust Law is “general economic interest”. Pursuant to the Antitrust Law, restrictive practices of competition are not forbidden per se, as said conducts must also harm, at least potentially, the general economic interest. Additionally, harm to the general economic interest has been identified by the Commission for the Defense of Competition (the “Antitrust Commission”) with the economic concept of consumer surplus and producer surplus (Case No 314/99 decided on March 19, 1999, File No 064-002687/97). This analysis has been confirmed by the Supreme Court of Justice (“Fallos” 325:1702). Additionally, Resolution No 164/2001 of the Secretary of Defense of Competition, Consumer and Deregulation states that consumer surplus is the system to asses whether an economic concentration may harm the general economic interest.

The First Project replaces a macroeconomic motivation related to the general interest by a concept that already identifies the specific interest of consumers, which would be a much broader concept.

In relation to the general interest of consumers, Argentina has specific legislation to protect them (Law No 24,240). The Antitrust Law does not protect the interest of consumers, as it was conceived to protect a higher interest: the “general economic interest”.

According to the new wording of article 1 of the Antitrust Law, the economic theories of consumer and producer surplus may not be used anymore as the conduct shall be considered restrictive of competition as soon as damage to the consumers is evidenced or alleged.

The Second Project (File No 893-D-2006) sets up the general prosecutor for competition who may (i) file a claim in order to start the proceedings provided by the Antitrust Law, (ii) require the issuance of preventive measures mentioned in Article 35 of the Antitrust Law; and (iii) require the assistance of national, provincial and municipal authorities in order to investigate potential anticompetitive conducts. Also, all claims filed by any third party regarding anticompetitive conducts must be notified to the prosecutor for its intervention. Finally, the prosecutor must also look after due compliance of the resolutions issued by the Antitrust Commission, the Argentine Tribunal for the Defense of Competition (the “Tribunal”) or any Court of Appeals.   

It is important to point out that while the independent Tribunal has not yet been set up, the Second Project concentrates additional powers within the Ministry of Economy and Production. If this amendment is approved, a deputy to secretary of the Ministry of Economy and Production will be the prosecutor while the Antitrust Commission, which also depends from the same Ministry, will issue the opinion and the final resolution will be issued by the Secretary of Domestic Trade (the “Secretary”) of the Ministry of Economy and Production.

Finally, the Amending Bills have only been approved by the House of Representatives and have to be considered by the Senate.