The influence of the Competition Act on the behaviour of Maltese larger firms

Abstract

There is a general recognition that market competitionn yields advantages in terms of variety, prices and quality. Manipulation of the market by, for example, firms in dominant positions, distorts competition at the expense of small enterprises, new entrants in the market and most importantly, consumers. For these reasons, it is often argued that a legislation promoting market competition is desirable. Such regulation provides statutory arrangements for the observance of the so-called rules of the game. The competitive game has to be played fairly, that is, without unfair advantages arising from restrictive practices, monopoly power or undue abuse of a dominant position in the market. r The Act to regulate competition and provide for fair trading in Malta was enacted in December 1994 and came into force on February 1st 1995. The act provides for the setting up of the Office for Fair Competition and the Commission for Fair Trading. The objective of the Competition Act is to regulate competition and to provide a framework for fair trading. The Act set up a new legal framework, which was previously non existent within the Maltese legal structure, to control and sanction restrictive practices. The Act, Is to large extent based on competition law in the European Union, which aims to provide an effective mechanism for undertakings to be more efficient and innovative, and at the same time satisfy consumers' needs.