Chief Justice Gesmundo: Courts Must Balance Protecting Intellectual Property Rights and Promoting Fair Competition
November 29, 2023
Chief Justice Alexander G. Gesmundo delivers his keynote address entitled “Balancing IP, Innovation and Competition in ASEAN Markets” at the 10th ASEAN Competition Conference on November 29, 2023 at Hotel Conrad Manila in Pasay City. (Courtesy of the Supreme Court Public Information Office)
“Courts must strike a careful balance, interpreting laws in a way that safeguards IP [intellectual property] rights while at the same time, preventing their misuse in creating monopolistic or anti-competitive market conditions.”
Thus, remarked Chief Justice Alexander G. Gesmundo in his keynote address entitled “Balancing IP, Innovation and Competition in ASEAN Markets” at the 10th ASEAN Competition Conference held on November 29-30, 2023 at Hotel Conrad Manila, Pasay City.
Recognizing the Judiciary’s vital role in shaping the Philippine economy and society, the Chief Justice stressed that “[t]hrough decisions which form part of the law of the land, and rules that ensure the proper exercise of government power, in balance with the fundamental rights of citizens, the Philippine judiciary has defined a legal framework conducive to the development of a free, vibrant, and competitive market.”
Chief Justice Gesmundo also discussed the Philippine Competition Act (PCA) and the state of competition law in the country, highlighting that after the enactment of the PCA in 2015, the Philippine Supreme Court immediately drafted the rules governing the applications, issuance, and enforcement of inspection orders for administrative investigations by the Philippine Competition Commission (PCC).
The Chief Justice likewise shared recent significant decisions of the Supreme Court on the PCA, such as Gios-Samar, Inc. v. Department of Transportation and Communication (G.R. No. 217158), where the Court clarified that what constitutes as monopolistic conduct in the grant of exclusive concession agreements is “when an entity which has achieved a dominant position in a relevant market engages in conduct in abuse of its dominant position.”
Another recent landmark ruling on Philippine competition law is Philippine Contractors Accreditation Board v. Manila Water Company (G.R. No. 217590), where the Court nullified a provision in the Revised Rules and Regulations Governing Licensing and Accreditation of Constructors in the Philippines which reserves regular licenses “for contractor-firms of Filipino sole proprietorship or partnership/corporation with at least 60% Filipino equity participation.” The Court also held in the same case, where the PCC served as amicus curiae, that acts that can restrain competition include governmental acts such as laws passed by Congress, rules and regulations issued by administrative agencies, and even contracts entered into by the government with a private entity.
While the Court has yet to decide a case specifically touching on the interplay between IP rights and the principles of fair competition under the PCA, the Chief Justice emphasized the need for the Judiciary to be “deeply aware of the socio-economic implications of its decisions.”
The two-day Conference is themed “From Innovation to Impact: Synergizing Antitrust and IP Regulation for a Stronger ASEAN.” Among the panelists and attendees are business leaders, IP experts, diplomats, ASEAN officers, and Competition Commission officials from Brunei Darussalam, Malaysia, Thailand, Laos, Vietnam, Singapore as well as officials from the Philippine Competition Commission. Plenary sessions include discussions on Advancing Merger Control and IP Regulation in ASEAN Pharma Markets, Combatting Anti-Competitive Practicing in ASEAN Pharma Markets, AI [artificial intelligence] and IP in Digital Platforms: A Future (Competition) Issue?, Seeds of Innovation: Promoting Access in Biotech through Competition, and Technology Transfer and Competition.
In closing, Chief Justice Gesmundo stressed that the Judiciary’s role in the Philippine economy is not a passive one, but one which “creates a legal landscape that will foster economic growth and ensure that the fruits of progress are equitably shared amongst all members of the community.” (Courtesy of the Supreme Court Public Information Office)
Chief Justice Alexander G. Gesmundo and Philippine Competition Commission Chairperson Michael G. Aguinaldo pose for posterity at the 10th ASEAN Competition Conference on November 29, 2023 at Hotel Conrad Manila in Pasay City. (Courtesy of the Supreme Court Public Information Office)
Chief Justice Alexander G. Gesmundo shares a light moment with Philippine Competition Commission (PCC) Commissioner Ferdinand M. Negre (center) and PCC Chairperson Michael G. Aguinaldo (right) at the 10th ASEAN Competition Conference on November 29, 2023 at Hotel Conrad Manila in Pasay City. (Courtesy of the Supreme Court Public Information Office)