About Competition Law

What is Competition Law ?

Competition law regulates the conduct of businesses operating in a market to allow for optimum levels of competition. 
The main goal in doing so is to increase consumer welfare manifested by:
  • Wider choices
  • Lower prices
  • Higher quality goods
  • Increased investment by businesses
  • More effective production methods 

When exclusion of rivals in business occurs, this leads to high prices being imposed on consumers and other businesses. So, by regulating business conduct, regulators ensure that rivals are not pushed out of the market.  

Why is Competition Law Important?

Competition policy is about applying rules to make sure businesses and companies compete fairly with each other. This encourages enterprise and efficiency, creates a wider choice for consumers and helps reduce prices and improve quality.

Low prices for all:

the simplest way for a company to gain a high market share is to offer a better price. In a competitive market, prices are pushed down. Not only is this good for consumers - when more people can afford to buy products, it encourages businesses to produce and boosts the economy in general.

Better quality:

Competition also encourages businesses to improve the quality of goods and services they sell – to attract more customers and expand market share. Quality can mean various things: products that last longer or work better, better after-sales or technical support or friendlier and better service.

More choice:

In a competitive market, businesses will try to make their products different from the rest. This results in greater choice – so consumers can select the product that offers the right balance between price and quality.

Innovation:

To deliver this choice, and produce better products, businesses need to be innovative – in their product concepts, design, production techniques, services etc.

Better competitors in global markets:

Competition within the EU helps make European companies stronger outside the EU too – and able to hold their own against global competitors.

(List from: European Commission)

How will Competition Law Affect my Business? 

Competition Law is an economic law that is meant to increase consumer welfare and protect businesses from anti-competitive conduct. (See "Three pillars of Competition Law" below) It allows the oversight and regulation of negative conduct of persons and businesses within Belize that don’t allow other to operate within the country, restricting competition. When exclusion of rivals in business occurs, this leads to higher prices being imposed on you. By overseeing regulating negative business conduct, regulators help to ensure that rivals are not pushed out of the market.

Three Pillars of Competition Law

Competition Law is necessary to preserve fair competition in a market that focuses on three areas: 


THREE PILLARS OF COMPETITION LAW

PILLAR #1: Anti-Competitive Agreements - watch video
These are agreements between two or more persons/businesses that restrict competition so that only the entities involved can profit such as: 
  • Price Fixing – when firms agree to sell items at a price higher than they normally would if they were competing against each other.
  • Restricting Supply – When firms restrict the quantity of goods/services supplied with the intention of raising prices.
  • Market Sharing – When firms agree to operate only within agreed areas in the country.
  • Bid Rigging - When businesses agree, when bidding for a contract, which one will win that contract and at what price. 
PILLAR #2: Abuse of Dominance - watch video

Abuse of a dominance occurs when a large company, or group of companies, come together to: 

  • Eliminate or discipline a competitor, 
  • Drive out competitors, or
  • Restrict new businesses from entering the market... 

with the intention of preventing or substantially lessening competition to solely own the market. 

PILLAR #3: Regulating Mergers / Acquisitions - watch video

Merger control refers to the procedure of reviewing mergers and acquisitions to vet in advance whether mergers will

  • Have a detrimental impact on competition, or 
  • Result in anti competitive effects.