SPEECH BY DR KOH POH KOON, SENIOR MINISTER OF STATE FOR MINISTRY OF TRADE & INDUSTRY AND NATIONAL DEVELOPMENT AT THE OFFICIAL LAUNCH OF THE COMPETITION AND CONSUMER COMMISSION OF SINGAPORE, MONDAY, 9 APRIL 2018, 11.00AM, SUNTEC CONVENTION AND EXHIBITION CENTRE
Mr. Lim Biow Chuan, President CASE
Ladies and gentlemen,
A very good morning.
1. I am happy to be here this morning to launch the new identity of the Competition Commission of Singapore, better known as CCS. Competition is a defining characteristic of a free market economy, which facilitates innovation and encourages a more efficient allocation of resources. This in turn contributes to the growth and resilience of the economy.
2. CCS may be one of the smaller government agencies in the public service, but despite their lean structure, they have shown themselves to be a competent and capable competition law enforcement agency. The Global Competition Review, a leading competition law journal and news service, in its annual survey of the world’s leading competition authorities, awarded CCS with three stars in 2017 and 2016. CCS was also commended for being a small but effective enforcer and a “true success story” in the growing ASEAN competition community.
New Identity – Competition and Consumer Commission of Singapore
3. As many of you would already know, Enterprise Singapore or ESG, was recently formed through the merger of SPRING Singapore and International Enterprise Singapore.
4. To sharpen ESG’s focus on enterprise development and internationalisation, CCS has been restructured to take over ESG’s role as the appointed administering agency for the Consumer Protection (Fair Trading) Act or CPFTA. And to better reflect CCS’s expanded scope of functions, CCS is renamed the “Competition and Consumer Commission of Singapore”, or CCCS.
Consumer Protection in Singapore
5. The government’s approach to consumer protection is based on promoting fair trading by businesses, while helping consumers make informed purchasing decisions. There are three main thrusts in our consumer protection framework: consumer education, legal redress by consumers as provided by consumer protection law, and enforcement of the consumer protection law.
6. It is important for consumers to know their rights and be alert to unfair trading practices. Playing a key role in championing consumer education is the Consumers Association of Singapore, or CASE. CASE was founded in 1971 as a non-profit, non-government organisation committed towards protecting consumers’ interests, and CASE was also one of the driving forces behind the introduction of consumer protection legislation in Singapore.
7. The CPFTA provides for civil actions against the errant businesses who engage in unfair trading practices, and is a key pillar in our consumer protection framework. The CPFTA was introduced in 2004 and was last amended in December 2016, when I took Parliament through the amendment. This was done to enhance the consumer protection framework to better safeguard consumers’ interests. One of the key amendments then was to appoint then-SPRING Singapore, now known as ESG, as the administering agency for the CPFTA. Since their appointment, ESG has worked closely with CASE in enforcing and advocating consumer rights.
Transfer of Consumer Protection Function from SPRING to CCCS
8. As the appointed administering agency of the CPFTA, CCCS will be empowered with investigation and enforcement powers to take timely action against the small number of errant businesses, who unfortunately continue to persist in unfair trading practices and take advantage of consumers. CCCS will also be able to file injunction applications with the Court to stop unfair trading practices.
9. CCCS is well-positioned to take on the consumer protection role. The enforcement of both the Competition Act and the CPFTA involves investigations and enforcement related to the conduct of individuals and businesses, which plays well to the strength of with CCCS’s track record in enforcement, as well as its strong in-house legal and economic capabilities.
10. The existing officers in ESG are transferred to CCCS to ensure a smooth transition. Meanwhile, CASE will continue its good work in assisting consumers resolve their disputes with businesses and raising consumer awareness. In addition, ESG will maintain their role in enforcing other aspects of consumer protection such as consumer product safety and standards. CCCS will continue to work closely with partners and stakeholders, including CASE and ESG, to promote fair trading practices by businesses and to help consumers make informed purchasing decisions.
Relationship between Competition and Consumer Protection
11. Competition and consumer protection share a close and complementary relationship. Measures to enhance competition in markets can bring about benefits for consumers, and similarly, measures to empower consumers can also spur greater competition in markets.
12. For example, the then-CCS conducted a market inquiry into the supply of formula milk in Singapore last year, and that has attracted quite a lot of attention publicly. In their study, CCS found that an insufficient understanding of the nutritional content of formula milk and the dietary requirements of infants and young children, had led parents to perceive that the more expensive or premium brands of formula milk were of a higher quality. Coupled with strong consumer brand loyalty, formula milk manufacturers therefore competed by building a premium brand image through aggressive marketing.
13. To facilitate grater price competition in the market, recommendations, such as a review of importation rules for formula milk to allow consumers to enjoy a wider range of formula milk products at more competitive prices, were proposed. In addition, CCS also suggested to strengthen education efforts to help consumers better understand the nutritional content of formula milk and the dietary requirements of infants and young children. The taskforce for infant formula milk, which I chair, has therefore taken on board the recommendations of CCS and we have since coordinated a multi-agency workforce to push through some of these recommendations, to bring about a more balanced market for the infant milk sector.
New Mission and Vision
14. CCCS’s vision is for “a vibrant economy with well-functioning and innovative markets”. Competition keeps our markets free and open, and ensures that all businesses can compete on a level playing field. Competition also spurs innovation, as businesses strive to differentiate themselves in terms of efficiency and new products and services, which in turn benefits consumers by driving productivity and sustainable long term economic growth.
15. Well-functioning markets, with fair trading practices, also bring about benefits for consumers as they gain quicker access to newer and better products and services, and this is CCCS’s promise to both businesses and consumers – “making markets work well to create opportunities and choices for businesses and consumers in Singapore”.
16. It gives me great pleasure to announce that CCCS will be embarking on two new initiatives in the coming year, both of which will bring about benefits for both businesses and consumers.
Market study on the online travel booking sector
17. Firstly, CCCS will be conducting a market study into the online travel booking sector, to take a closer look at whether the market is functioning well. I am sure many if us here are consumers that go onto the online travel booking platform fairly frequently. Singaporeans are increasingly well-travelled and with the rise of the digital economy, online travel booking platforms have become a key channel for consumers to search for and purchase travel-related products, including air tickets and accommodation, other than purchasing directly from the service providers, for example the hotels and airlines.
18. CCCS’s market study will focus on understanding the industry landscape relating to both the provision of flight tickets and hotel accommodation in Singapore. This will help CCCS to understand how commercial practices and arrangements in the online travel sector impacts competition and consumers in Singapore. In particular, CCCS intends to look into the types of commercial arrangements entered into between third party online travel booking platforms and the service providers, including how such commercial arrangements are negotiated and applied in Singapore; and how online travel booking platforms and service providers compete with each other.
Joint initiative with the Personal Data Protection Commission (PDPC) on data portability
19. CCCS’s second key initiative this year is a joint one with the Personal Data Protection Commission or PDPC. Both agencies will be working together to study consumer protection, competition and personal data protection issues, which could arise if a data portability requirement is introduced in Singapore.
20. Internationally, several jurisdictions have provided, or are considering to provide for a right to data portability, which enables individual consumers to request for the personal data and other data which they have provided to a service provider, in a format which is structured, commonly used and machine-readable. This empowers consumers and allows them more control over their personal data.
It enhances the ability of consumers to choose between service providers and, having made that choice, facilitates consumers switching between service providers, as they do not have to repeatedly provide their details each time they switch providers. So certainly better competition and more convenience to all.
21. In addition, the right to data portability could extend to requiring service providers to transmit the personal data to another service provider without hindrance, where it is technically feasible. The ease of switching will in turn foster competition between service providers and also encourage them to innovate and develop new services, resulting in more choices for consumers.
22. Even as CCCS steps up to take on their new consumer protection role, CCCS will not compromise their current role as the national competition authority.
The enforcement of the Competition Act deals with the anti-competitive conduct of businesses while the enforcement of the CPFTA ensures that businesses engage in sound trading practices. Both bring about benefits for consumers, and in different ways.
23. With a broader overview of both the competition and consumer protection domains, CCCS will work to safeguard fair trading and competition to ensure the proper functioning of Singapore’s markets so that consumers can enjoy a wider variety of products and services at competitive prices.
24. I thank all of you for being here to celebrate the launch of the Competition and Consumer Commission of Singapore with me – A new function, a new perspective, and a new identity, both nationally and internationally, but certainly one that we are all proud to have in Singapore. CCCS will be counting on your support as they tackle the challenges ahead.
25. Thank you.