The United Arab Emirates (UAE) has introduced a new law that prohibits companies from engaging in monopolistic practices, such as offering or applying very low prices to drive competitors out of the market. The law aims to ensure fair competition and protection of consumer rights in the country. It also regulates mergers and acquisitions (M&A) in the local market. The Ministry of Economy will monitor and communicate with local authorities for inspections to ensure fair competitive practices. The authority can also take action in response to complaints.
Abdullah Ahmed Al Saleh, Undersecretary of the Ministry of Economy, stated that the new law aims to combat monopolistic practices and create a stimulating environment for enterprises, enhancing competitiveness and protecting consumer interests. The law promotes economic activities in line with economic freedom principles and monitors economic concentration. It addresses conditions that may undermine or restrict competition, ensuring consumer protection from anti-competitive practices and promoting economic efficiency.
The law defines economic concentration as any act resulting in the transfer of ownership or control of property, rights, shares, or obligations from one establishment to another, leading to the dominance of a small number of firms in a specific industry. The law considers the annual sales value of enterprises involved in economic concentration. To successfully complete the process of economic concentration, two conditions must be met: the total value of annual sales of establishments in the relevant market must exceed a specified amount, and the total share of establishments must exceed a certain percentage of total transactions in the market.
Companies can submit their views on the Application for Economic Concentration project and provide relevant data or information to support their request in line with global best practices. The ministry is working towards developing a more agile and sustainable competitive system, aiming to make the UAE a global hub for the new economy in the next decade. The law assigns new responsibilities to the Competition Regulation Committee, including proposing general policies for protecting competition and scrutinizing issues related to the application of the law.
In conclusion, the UAE’s new law on competition regulation aims to promote fair competition, combat monopolistic practices, and protect consumer interests. The law prohibits companies from engaging in unfair competitive practices and monitors economic concentration in the market. Companies must comply with the regulations outlined in the law to ensure a level playing field for all businesses operating in the UAE. The government is taking steps to enforce the law and ensure that companies adhere to fair competition practices as part of its efforts to promote economic growth and protect consumer rights in the country.
