Before the parliamentary recess in May, the Congress of the Republic is expected to approve initiative 5074, Competition Law, which must still be discussed in third reading and drafted by articles, including some amendments.
Alfredo Vila, president of the Association of Sugar Producers of Guatemala (Asazgua), made known some considerations regarding the discussion that has developed so far, as well as the possible scope that the regulations would have on sectoral and productive activity.
The business leader made it clear that, as an agro-industrial sector, they are not afraid of the approval of a competition law, but they hope that it does not harm the economy. This was his position, in an interview with Free Press following having participated in the forum “When and why approve a Competition Law” which was recently organized by the Faculty of Law of the University of Istmo.
As a sector, what do you think of competition law?
We have been analyzing competition law for many years, and practically since the first project began to be promoted. In principle, we agree that there should be a competition law.
The entire interest of our sector, and I might say that of the private sector in general, is that a law be approved that achieves the objective of improving the interaction between different companies, not a law that undermines productive activity.
There is no country that can escape poverty without promoting wealth; Companies are the only ones responsible for creating wealth in the country, so laws that undermine the activity they carry out should not be approved.
We are one of the few countries in the world that does not have a competition law and I think it is time for it to be approved, but without harming national production.
In other words, a law that contributes to the economy and does not delay it…
That’s how it is. We do not expect a competition law that will lower prices or change market conditions much. What competition law has to do is regulate the free provision of products and services and compete in a more appropriate way.
In particular, regarding bill 5074, what observations do you have?
There are several observations that we have already raised in the appropriate ways, and we agree that there must be an independent authority, with suitable and expert people. That is a hurdle that we will have to face.
So, would you agree with the process moving forward?
Specifically at Asazgua we agree that it should be regulated; and another very important aspect is that the resources resulting from the fines are not directed to the Judicial Branch (OJ) or the governing entity, because it might become a perverse incentive: I impose more fines… I obtain more resources. An independent budget must be managed, and the proceeds of fines must be set for a specific purpose.
In your opinion, is the legislative dialogue that is being carried out convincing?
Like any law, these have to come out, and then undergo modifications, adapting to the real conditions of the market and the country’s situation. The worst that can happen is that we have been analyzing the regulations for almost 20 years and several proposals for initiatives have come out that have not been approved, so it is time to do it.
But a reasonable period must also be provided so that companies know the law and can adapt their management system to it, so that its implementation throughout the system passes more smoothly.
You believe that cartels operate in Guatemala…
I would not like to talk regarding cartels, and that each one understands the term in different ways. We, the agribusiness, are called cartels and if I give it my interpretation, then I feel proud to be part of that cartel. Why? Because we have managed to elevate the condition of our industry to third place in competitiveness worldwide.
And if calling a poster means that we have carried out joint actions on social issues; that we established Fundazúcar since 1990; that we have carried out extraordinary programs not only for our area of influence, but for the country; that today we are signing agreements with municipalities and governments to transfer successful programs; having established the Sugar Cane Research Center, which is one of the best in the world; that of having established the Climate Change Study Center, which is the only private center on a global scale;… well, it is what all groups would like.
The cargo dispatch center at the Expogranel port, which is one of the most efficient in the world, has been created through joint action. And what’s more, today seeing the results of this action that we have, following much effort we have managed to form the Union of Sugar Producers of Latin America, which included nine countries four years ago and today we are 12 countries in Latin America. And we are not going to stop competing, but we are looking for synergies to be stronger in all our social initiatives and development sustainability for the sectors and, consequently, for the country.
So, is there anything to fear from a competition law?
There is no need to fear it, as long as it is not done with the objective of harming producers, which I believe is not the objective, but we have to analyze what ultimately comes out of the Congress of the Republic.
In international marketing, are there any conditions that are required for this type of legislation?
No. What the markets demand is quality, punctuality in delivery and yes there are some certifications that some companies request, but I have never known that the country or any company is required to have a competition law.
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