Competition law, also known as antitrust law or competition law, is a branch of law that seeks to promote and protect free competition in economic markets. Its main objective is to prevent anti-competitive practices that may harm competition, limit consumers’ freedom of choice or restrict the entry of new competitors into the market.
Competition law covers several topics, among which are:
Anti-competitive practices: Includes the prohibition of collusive agreements, which are arrangements between competitors to fix prices, share markets or limit production. Unilateral conduct by dominant companies seeking to exclude or harm smaller competitors is also prohibited.
Abuse of dominant position: This refers to practices of companies that have a dominant position in the market and abuse that position to limit competition, prevent the entry of new competitors or unfairly affect their rivals.
Mergers and acquisitions: Competition regulations may intervene in mergers and acquisitions that may have a negative impact on competition in the market. These operations may be prohibited or conditioned if it is considered that they would significantly reduce competition.
Subsidies and state aid: In some cases, state aid or subsidies to certain companies may distort competition and may be subject to regulation to ensure a level playing field in the market.
In Colombia, competition law is mainly regulated by Law 155 of 1959, also known as the Unfair Competition Law, Decree 2153 of 1992 and Law 1340 of 2009, known as the Antitrust Law.
The Superintendency of Industry and Commerce (SIC) is the entity in charge of supervising and enforcing these laws, investigating and sanctioning anti-competitive practices and abuses of dominant position. These rules prohibit all conducts that imply restrictions or limitations by market participants to the constitutional right to free competition, also contemplating the procedures to determine the commission of infringements and the corresponding sanctions.
In addition to the aforementioned laws, Colombia also has a merger control regime that is regulated by the SIC. Companies wishing to carry out mergers and acquisitions must notify the SIC for review and approval, and the entity will evaluate whether the operation would adversely affect competition in the market.
Competition law in Colombia aims to foster fair competition and protect consumers, promoting an economic environment in which there are more options, competitive prices and greater benefits for consumers and society in general.
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