The lack of a competition law in Guatemala could expose the country to sanctions from the European authorities, since it is a requirement demanded in the regulations of the Association Agreement with the European Union.
Since the end of 2016, the Association Agreement (AdA) required Guatemala to have a law on the matter, since in 2019 a Central American competition authority would have to be created.
After making more than 40 amendments to the previous project, the legislative commission will be presenting a proposal and expects the process to move forward without further modifications.
The Economy Commission of the Congress of the Republic reported that they presented a second opinion on the Competition Law initiative, and took the opportunity to explain that among the parties that participated in the work room, they agreed that the topic will be addressed in a single reading and no last minute amendments will be presented.
The decree approved by the Guatemalan Congress was the missing step needed to implement the free movement of people and goods between the two Central American countries.
From a statement issued by the Ministry of Trade:
Guatemala, January 22, 2016. The Congress of Guatemala yesterday approved a Protocol Enabling the Deep Integration towards the free movement of people and goods between the Republics of Guatemala and Honduras.
The authorities have until November 31, 2016 to approve a law for the promotion and defence of competition.
The European Union needed to demand a Competition Law in the Association Agreement with Central America in order for Guatemala, the only country in the region not to have rules in this area, to bring the country up to date in this area.
Alejandro Williams, Deputy Minister of Investment and Competition, told Diario de Centroamerica that the initiative will be handed over to the authorities who assume office on January 14, and then it will be forwarded to Congress. The Law on the Promotion and Protection of Competition, as the project will be known, must be approved before the November 31, a deadline established in the trade agreement.
In Costa Rica the regulatory body has agreed to the commitment made by Essilor Internacional not to distort the market by blocking raw materials or price discrimination, as a condition for the purchase of Grupo Vision.
From a statement issued by the Commission to Promote Competition (COPROCOM):
The Commission to Promote Competition (COPROCOM) a body under the Ministry of Economy, Industry and Commerce (MEIC), determined that the transaction whereby the company ESSILOR INTERNACIONAL acquires a majority stake in the company Brine Holding (which owns companies belonging GRUPO VISION), could generate an anti-competitive effect of closing the market by blocking materials, if the company Essilor stops supplying its current or potential customers with the products or services it provides through ILT de Costa Rica and Óptica Industrial S.A. (OPTISA).
The only country in the region that does not have policies on competition needs to legislate before November 2016 in order to trade with the European Union using the Association Agreement.
Year after year the Guatemalan private sector insists on the need for a competition law to help promote foreign investment and to establish a regulatory framework to prevent market barriers and benefit consumers.