In Colombia, there are five sectors that have specific dominance rules. The rules on these sectors are complementary by virtue of article 6 of Law 1340 of 2009. These sectors are explained below.
The financial sector
Delving into the financial sector, the relevant regulation is Decree 663 of 1993 - Organic Statute of the Financial Sector (OSFS), the basic legal circular of the Financial Superintendency, and Law 1328 of 2009. Article 46 of the Organic Statute of the Financial Sector establishes two principles that govern state intervention, namely to promote free competition; and ‘to structure a legal framework in which each type of institution can compete with others under conditions of equity and equilibrium’.
In addition, article 58 of the Organic Status regulates the Financial Superintendent’s competition to object ex ante mergers between financial entities. One of the regulated causes (article 58(d)) refers to dominant position. However, by express legal provision, it is presumed that transactions that do not exceed a 25 per cent threshold do not generate significant risks for the competition process, which is why they will be considered authorised. In any case, it should be noted that section 2 of article 71 of the OSFS, indicates that the Financial Superintendent must ensure that the public welfare is fostered with the proposed operation.
Finally, financial entities have specific obligations to refrain from incurring an abuse of contractual dominant position since article 7(e) of Law 1328 of 2009 consecrates that obligation.
Gas and energy
Certain levels in the value chain of gas and energy are subject to more stringent regulations, such as transportation and distribution. By way of example, the activity of transporting natural gas is strictly regulated, since transporters cannot refuse to provide the natural gas transport service to users who request it, except for objective reasons defined in the regulation.
The Commission for Regulation of Energy and Gas (CREG) in Law 142 is the competent body to regulate this sector. In fact, according to article 73 of the Law 142 of 1994, it is up to this authority to regulate monopoly markets in the provision of this public utility when competition is not possible. It is for this reason that vertical integration is prohibited in this level of the natural gas’s value chain.
Likewise, the CREG has regulated aspects related to natural gas’s transportation contracts such as price, by establishing the applicable methodology to set the rate. In this sense, Resolution 126 of 2010 consecrates the general criteria for the remuneration of the natural gas transport service and the general scheme of rates within the National Transportation System, based on which the CREG, through a special administrative act, approves the rates that each transporting company can charge during a tariff period of five years.
The CREG’s Resolution 089 of 2013 modifies essential aspects of the natural gas wholesale market for supply and transportation, based on the functions assigned to regulatory commissions by virtue of article 73 of Law 142 of 1994 as well as stipulated in subparagraph a) of article 74.1. Based on these articles, the CREG regulates the exercise of activities of the energy and fuel gas sectors to ensure the availability of an efficient energy supply, foster competition in the mining energy sector, and propose the necessary measures to prevent abuses of dominant position.
Finally, regarding the distribution of functions among different state authorities, the design of the general policies of the industry corresponds to the government through the Ministry of Mines and Energy (MME). For its part, it is the task of the CREG to issue the ex ante regulation applicable to the market agents that attend the sector, by issuing administrative acts of a general and particular nature.
Dominance rules, as well as anticompetitive conducts in the health sector, are regulated through the Decree 1663 of 1994. The first applicable rule is article 3, which establishes a general prohibition to refrain from anticompetitive conducts, stating that all agreements, acts, and covenants, as well as practices and concerted decisions that are intended or have the effect of an abuse of dominant position are prohibited.
The Decree also includes a list of abusive conducts for the health sector in article 9 that uses technical health language. The decree includes predatory pricing, discriminatory conditions, tying and bundling, discriminatory sales to distributors and regional discrimination. Finally, article 10 of the Decree clarifies that the competent authority regarding the protection of competition is the SIC.
Public utilities regime
Dominance rules in the public utilities sector are described in the Law 142 of 1994. Specifically, dominance rules are described in articles 14, 34, 35, and 133. Article 14 defines dominant position combining contractual and market matters. By this provision, it is presumed that public utility companies always have dominant position over the users and subscribers since dominant position is the one that a utility company has with respect to its users. In a different manner, dominant position in the market is presumed only when a public utility company has a market share of at least 25 per cent. Hence, to determine a dominant position in this market it is not necessary to analyse any additional elements such as barriers to entry and concentration of the market.
Article 34 consecrates a general prohibition that public utilities must follow, and that combines unfair competition and competition law subjects. This article also establishes a list of conducts that are considered as anticompetitive. Within the list, there is a prohibition on abuse of dominant position, which refers to article 133 of the Law. For its part, article 133 of Law 142 of 1994 provides a list of contractual clauses that are presumed to be abuses of dominant position in the public utilities sector.
Article 35 of the law imposes a duty to pursue the best objective conditions on companies that have a dominant position in the market and whose main activity is the distribution of goods or services provided by third parties.
Television’s specific dominance rule is contained on article 5(d) of Law 182 of 1995, which refers to the state’s obligation to investigate and punish the monopolisation of the electromagnetic spectrum.
Article 13 of the Law 1507 of 2012 states that the superintendency is the competent body to develop what is stated on article 5(d) of Law 182 of 1995.
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