The law will also regulate mergers and acquisitions (M&As) in the local market.
The UAE has introduced a new competition law that prohibits establishments from offering “very low prices” for their products and services.
The new Competition Regulation Act was launched by the Ministry of Economy after the review of Federal Decree-Law No. 36 of 2023 in a media briefing, according to WAM, which aims to combat monopolistic practices and ensure consumer protection.
“The new law aims to combat monopolistic practices by ensuring a stimulating environment for enterprises, contributing to enhancing effectiveness, competitiveness and protecting consumer interests,”
Abdullah Ahmed Al Saleh, undersecretary of the Ministry of Economy, said.
“It also promotes the market economy and economic activities in line with the principle of economic freedom and ensures that economic concentration is monitored. Its articles address all conditions that may undermine, limit, prevent or restrict competition,”
he added.
The new law would allow customers to have freedom in purchasing commodities, as well as promote fair competition among companies and investors.
“Ensuring consumer protection from anti-competitive practices in the context of operationalisation of new market mechanisms, the promotion of economic efficiency, marketing and R&D are also key goals,”
the undersecretary said.
Competition, as defined by the law, is “carrying out economic activities according to the market mechanisms without affecting or restricting such mechanisms, which would cause harms to trade, development and consumer’s interest.”
The new law introduces measures to prevent the abuse of economic dependence and prohibits establishments to offer commodities at very low prices for the purpose of hindering other competitors in entering the market.
Two conditions must be satisfied to successfully complete the process of economic concentration. The first condition indicates that the total value of annual sales of such establishments in the relevant market, for the last fiscal year, shall exceed the amount determined by the Cabinet, upon the minister's proposal. The second condition states that the total share of such establishments shall exceed the percentage of the total transactions in the relevant market during the last fiscal year, as determined by the Cabinet. The Executive Regulation of this law establishes the controls for submitting the application for economic concentration, the documents to be attached, and its examination mechanisms.
The ministry said that companies can submit their views on the Application for Economic Concentration project and also provide any data or information that would help study the request, in line with global best practices in the field of competition.
The ministry elaborated that efforts are currently underway to develop a more agile and sustainable competitive system, including the launch of more pioneering legislation, initiatives, and programmes to make the UAE a global hub for the new economy within the next decade.
Source: The Filipino Times, Khaleej Times
