The Philippine Competition Commission (PCC)

The PCC’s Jurisdiction to Force Data Sharing

The Philippine Competition Commission (PCC) is an independent, quasi-judicial

regulatory body formed to implement Republic Act No. 10667, otherwise known as the
Philippine Competition Act (PCA). The PCC aims to promote and maintain market competition
within the country by regulating anti-competitive behavior, i.e. prohibited acts which prevent,
restrict, or lessen competition.1
One can argue that it is within the PCC’s jurisdiction to mandate data sharing. Some of
the prohibited acts under the PCA that the PCC can prevent are the abuse of dominant position
and anti-competitive mergers and acquisitions.
The abuse of dominant position under the PCA essentially prohibits entities from abusing
their dominant position by engaging in conduct that would substantially prevent, restrict or
lessen competition.2 Of course, dominant position—the capability to control the relevant market
regardless of other actors—is not per se illegal.3 To constitute a prohibited act under the PCA,
such must be coupled by abusive conduct which includes, among others, limiting production,
markets, or technical development to the prejudice of consumers,4 and setting terms or conditions
that discriminate unreasonably between customers or sellers of the same goods or services, who
are contemporaneously trading on similar terms and conditions, where the effect may be to
lessen competition substantially.5 Therefore, acts of abuse of dominant position can cause
damage to consumers directly, by limiting production, or indirectly, by “impacting on the
effective competition structure.”6
Another prohibited act under the PCA involves anti-competitive mergers and
acquisitions. Generally, mergers and acquisitions can be beneficial for the economy as they
enable a firm to join or acquire other firms thereby promoting efficiency in operations (through
the transfer of technologies, wider access to capital, and increased productivity) and lowering the
price of products.7 Mergers and acquisitions thus, in theory, result into an economies of scale and
scope, since the average costs per unit of output decrease with the increase in the scale or
magnitude of the output being produced and it becomes cheaper to engage in joint production
than to produce products separately. 8 However, mergers and acquisitions, especially those

1
An Act Providing For a National Competition Policy Prohibiting Anti-Competitive Agreements, Abuse of
Dominant Position and Anti-Competitive Mergers and Acquisitions, Establishing the Philippine Competition
commission and Appropriating Funds Therefor [PHILIPPINE COMPETITION ACT], Republic Act No. 10667, sec. 5
(2014).
2
Id., sec. 15.
3
Verizon Communications v. Trinko, 540 U.S. 398 (2004); US v. Alcoa, 148 F.2d 416 (2d Cir. 1945).
4
PHILIPPINE COMPETITION ACT, sec. 5(i).
5
Id., sec. 5(d).
6
Jere Lehtioska, Big Data as an Essential Facility: The Possible Implications for Data Privacy, at 19 (2018)
(master’s thesis, University of Helsinki).
7
Mark Thoma, Are mergers good or bad for the economy?, CBS NEWS, December 29, 2016, available at
[Link] (last accessed June 16,
2019).
8
KB Manage, Economies of Scope and Scale, KB MANAGE, 2008, available at
[Link] (last accessed June 16, 2019).
involving dominant companies, which prevent, lessen, or restrict competition are prohibited
under the law.9
With regard to big data, anti-competitive concerns may arise when the accumulation of
big data from a huge multitude of sources by merging companies leads to “such an advantage
that competitors will not be able to match anymore, increasing the likelihood of further anti-
competitive strategies.”10 This has been referred to as “relative foreclosure of the market
scenario,” where although the information from data acquired is ubiquitous and non-rivalrous,
the incentives to compete in the market are few, considering the incumbent’s position and since
potential competitors lack similar volume of data and are thereby foreclosed. 11 In other words,
companies can engage in ways to prevent reuse of data by competitors, where since the latter do
not have the necessary means and considerations to process the data they receive, such data
become useless.

The PCC’s Power to Force Data Sharing

The question now arises as to how the PCC can use its regulatory powers in order to
prevent or discourage the aforementioned acts and in effect force data sharing. Under the PCA,
the PCC has the general power to “[c]onduct inquiry, investigate, and hear and decide on cases
involving any violation of this Act.”12 It may do so motu proprio or upon receipt of a verified
complaint or upon referral.13
For abuse of dominant position, the PCC thus has a variety of regulatory powers under
the PCA to stop or redress the same. The PCC can, based on substantial evidence that “an entity
has abused its dominant position after due notice and hearing, stop or redress the same, by
applying remedies, such as, but not limited to, issuance of injunctions, requirement of
divestment, and disgorgement of excess profits under such reasonable parameters.” 14 It may thus
not only conduct interim preventive measures for dominant companies to comply with
significant market power obligations but also provide safeguards for non-dominant companies. 15
It can also undertake consultation with stakeholders and sector regulators.16
For mergers and acquisitions, the law provides for a notification and review process
where parties, the size of each exceeds P5 billion, to a merger and acquisition agreement in
excess of the P2 billion threshold are required to notify the PCC before consummating their
transaction.17 The PCC then reviews their notification within 30 days. 18 Failure to comply with
this notification requirement makes the merger and acquisition void and can subject the parties to
administrative penalties.19

9
PHILIPPINE COMPETITION ACT, sec. 20.
10
Jorg Hoffman and German Johannsen, EU-Merger Control & Big Data On Data-specific Theories of Harm and
Remedies, 19-05 MAX PLANCK INSTITUTE FOR INNOVATION AND COMPETITION 1, 1 (2019).
11
Lehtioska, Big Data as an Essential Facility: The Possible Implications for Data Privacy, at 19 (2018).
12
PHILIPPINE COMPETITION ACT, sec. 12 (a).
13
Id.
14
Id., sec. 12(d).
15
Id., sec. 12.
16
Id., sec. 12(c).
17
PCC Memorandum Circular 18-001: Amendment of Rule 4, Section 3 of the Implementing Rules and Regulations
and Republic Act. No. 10667 (Threshold Adjustment).
18
PHILIPPINE COMPETITION ACT, sec. 17.
19
Id.
 Given the foregoing powers, it appears that the PCC can enforce data sharing in order to
prevent or redress anti-competitive behavior it reasonably believes to exist or is in the verge of
existing. It bears emphasis however that the exercise of these powers of the PCC must be
consistent with the law’s purpose of prohibiting acts which prevent, restrict, or lessen
competition. As such, a company must actually abuse its dominant position or engage in anti-
competitive mergers and acquisitions (or commit other prohibited acts) in order for the PCC to
effectively and legally enforce data sharing, consistent with the essential facilities doctrine.
Further, the PCC shall not only take into account whether the exemptions apply to the companies
involved, but must also conduct rigorous economic analysis and investigation pursuant to
guidelines provided by law and the rules. While the PCC can enforce data sharing, the
administrative feasibility of doing such is questionable.

In assessing dominant position of a company, the PCA and its implementing rules
provide for a list of illustrative and non-exhaustive criteria for the PCC to consider. These
criteria include: (a) The share of the entity in the relevant market and the ability of the entity to
fix prices unilaterally or to restrict supply in the relevant market; (b) The share of other market
participants in the relevant market; (c) The existence of barriers to entry and the elements which
could foreseeably alter both the said barriers and the supply from competitors; (d) The existence
and power of its competitors; (e) The credible threat of future expansion by its actual competitors
or entry by potential competitors (expansion and entry); (f) Market exit of actual competitors; (g)
The bargaining strength of its customers (countervailing power); (h) The possibility of access by
its competitors or other entities to its sources of inputs; (i) The power of its customers to switch
to other goods or services; (j) Its recent conduct; (k) Its ownership, possession or control of
infrastructure which are not easily duplicated; (l) Its technological advantages or superiority,
compared to other competitors; (m) Its easy or privileged access to capital markets or financial
resources; (n) Its economies of scale and of scope; (o) Its vertical integration; and (p) The
existence of a highly developed distribution and sales network.20
For mergers and acquisitions, the PCC, in reviewing such transactions, must consider the
following factors by obtaining relevant data: (a) the structure of the relevant markets concerned;
(b) the market position of the entities concerned; (c) the actual or potential competition from
entities within or outside of the relevant market; (c) the alternatives available to suppliers and
users, and their access to supplies or markets; (d) any legal or other barriers to entry.21
A recent case in the Philippines involves the acquisition of Uber by Grab, both
transportation network companies (TNC), where the PCC imposed a fine amounting to P16
million for violation of Sec. 29(b) of the PCA or failure to comply with the PCC’s Interim
Measures Orders (IMOs).22 These IMOs were imposed by the PCC to first, prevent prejudice to
its power to review the transaction; second, to prevent prejudice to its power to impose remedies;
third, and most importantly, because it has reasonable ground to believe that substantial
lessening of competition was likely to exist.23 The PCC thus considered the following factors: (i)
the imminent integration of Uber and Grab given that they are the only major players in the
relevant market would lead to the latter being a virtual monopoly; (ii) Grab was still free to set
the price per kilometer closer to the maximum allowable price without any competitive pressure

20
Implementing Rules and Regulations (IRR) of the Philippine Competition Act, Rule 8, sec. 2.
21
Id., Rule 4, sec. 1(c).
22
PCC Case No. M-208-001
23
Id.
from Uber; (iii) Uber’s non-discriminatory features would no longer be available to the market,
leading to a reduction of quality of service; and (iv) there is a perceived barrier to market entry
since there was no indication that any TNC applications would be timely approved by the
LTFRB.24
As such, if there appears to be a justifiable reason for a dominant company to refuse
supplying data to other companies, such must be respected by the PCC as these do not constitute
anti-competitive behavior given the criteria provided by law. For example, a refusal to supply
might be necessary to allow the dominant company to receive an adequate return on investments,
thus creating incentives to continue to invest in the future, while acknowledging the risk of a
project’s success.25 Also, the dominant company can assert that its innovation will be negatively
affected by the obligation to supply data. 26 As argued earlier, however, forcing the sharing of
data even on reasonable grounds is easier said than done especially considering the policy
objective of the essential facilities doctrine and the administrative constraints attendant to such
imposition of the duty to deal or supply. These administrative constraints are, once again,
revolve around the lack of a single way to define the access terms for data, the PCC’s lack the
expertise to determine the optimal access price, and decrease of legal certainty given the lack of
clear limits to the essential facilities doctrine.27

Data Privacy and the PCC

At first glance, there appears to be an inconsistency with regard to the legality of data
sharing, where if such measure is required, a violation of data privacy laws may arise in the same
way that there may be a violation of competition law if such measure is not undertaken. This
inconsistency is also bolstered by the fact that individuals whose data are being collected are
often unaware of the processing of the same. 28 It is argued that despite the fact that the PCC
orders or forces data sharing, the law on data privacy will place additional requirements in the
processing of such data.
In the Philippines, Republic Act No. 10173, otherwise known as the Data Privacy Act
(DPA), was passed in 2012 “to protect the fundamental human right of privacy, of
communication while ensuring free flow of information to promote innovation and growth.”29
The DPA provides that the collection of personal data must be for “legitimate purposes
determined and declared before, or as soon as reasonably practicable after collection, and later
processed in a way compatible with such declared, specified and legitimate purposes only.” 30
Section 12 of said law also provides for criteria for lawful processing of personal data, which
essentially state that the data subject must freely give his/her consent or be subject of a contract,
that the data collector complying with a legal obligation, or that such processing is necessary for

24
Id.
25
Lehtioska, Big Data as an Essential Facility: The Possible Implications for Data Privacy, at 27 (2018).
26
Id., at 45-47.
27
Id., at 47-50.
28
Id., at 54.
29
An Act Protecting Individual Personal Information in Information and Communiactions Systems in the
Government and the Private Sector, Creating for This Purpose a National Privacy Commission, and for Other
Purposes For [DATA PRIVACY ACT] Republic Act No. 10173, sec. 2 (2011).
30
Id., sec. 11(a).
the protection of the vital interests of the data subject, for national emergency, or for legitimate
interests pursued by the personal information controller or third parties.31
More specifically, at least one of the following conditions must exist: (a) The data subject
has given his or her consent; (b) The processing of personal information is necessary and is
related to the fulfillment of a contract with the data subject or in order to take steps at the request
of the data subject prior to entering into a contract; (c) The processing is necessary for
compliance with a legal obligation to which the personal information controller is subject; (d)
The processing is necessary to protect vitally important interests of the data subject, including
life and health; (e) The processing is necessary in order to respond to national emergency, to
comply with the requirements of public order and safety, or to fulfill functions of public
authority which necessarily includes the processing of personal data for the fulfillment of its
mandate; or (f) The processing is necessary for the purposes of the legitimate interests pursued
by the personal information controller or by a third party or parties to whom the data is disclosed,
except where such interests are overridden by fundamental rights and freedoms of the data
subject which require protection under the Philippine Constitution.32
As for the consent and contract requirements, such appear to not be feasible bases for
forced data sharing. For one, it would be highly improbable if not totally impossible for a
dominant company to obtain the consent, which must be freely given, specified, and informed, of
all data subjects whose personal information would be shared to the competitors. 33 Further, law
provides for stricter requirements when it comes to sensitive personal and privileged
information.34 It is also unlikely that the dominant company would enter into a contract with the
data subject for purposes of personal data sharing with another company. 35 As for the necessity
for the protection of the vital interests of the data subject, one must consider what these vital
interests are, and more often than not, such do not refer to the commercial interests of the
company.
However, when the processing is necessary for the legitimate interests of the personal
information controller (e.g. the dominant company) or third persons (e.g. competitors), there
appears to be valid basis and an additional requirement for data sharing. The business interests of
the company can be considered a legitimate interest in that other companies can request for the
sharing of data in order to be competitive in the relevant market.
Another feasible basis under the DPA that can justify data sharing is the legal obligation
requirement, in that provided there is a legal provision which allows for the processing, and
consequent sharing, of personal data, the same shall be allowed. As discussed earlier, the PCC as
a regulatory body can, albeit administratively not feasible, issue orders to enforce data sharing
that would constitute legal obligations for companies.
The DPA also contains a provision on data portability, as a right of the data subject,
which provides:

The data subject shall have the right, where personal information is
processed by electronic means and in a structured and commonly used format,
to obtain from the personal information controller a copy of data undergoing
processing in an electronic or structured format, which is commonly used and

31
Id., sec. 12.
32
DPA
33
Lehtioska
34
DPA
35
Lehtioska
 allows for further use by the data subject. The Commission may specify the
electronic format referred to above, as well as the technical standards,
modalities and procedures for their transfer.36

While this provision allows the individual data subject to get his personal data being
processed and shared from the personal information controller to another without hindrance, the
exercise of this right is a limited solution to induced data competition. 37 Whereas competition
law remedies such as PCC orders concern general structures of economic competition, data
portability is considered an individual right that guarantees self-determination for data subjects
and not competitors.38 In other words, it involves the will of the consumers and not the
competitors which are the main subject of the PCA. On the flipside, reliance on the data
portability provision alone may in fact promote anti-competitive behavior if a dominant company
unduly influences the process of standardizing the data obtained to the detriment of smaller
entities and potential competitors, thus creating incumbent advantage and higher barriers to
entry.39
In sum, while there may be harmonization between the PCA and the DPA in terms of the
latter providing for legal justifications for the forced data sharing that can be conducted by the
PCC, such are limited not only in the number of provisions applicable to big data, but also in the
purpose behind said laws. While DPA provisions like the data portability right are available,
such do not ensure market competition in the big data industry. This, and considering the nature
of big data, pose potential problems in enforcing data sharing to prohibit anti-competitive
behavior.

36
DPA
37
EU merger control
38
Id.
39
EU Merger