ARTICLE 10.2

Legislative Framework

1.      Each Party shall adopt or maintain comprehensive legislation on competition that proscribes anti-competitive conduct, with the objective of promoting economic efficiency and consumer welfare, and shall take appropriate action with respect to such conduct.

2.      The competition law of the Parties shall, in their respective territories, effectively address:

(a)     agreements between enterprises, decisions by associations of enterprises and concerted practices which have as their object or effect the prevention, restriction or distortion of competition;

(b)     abuses by one or more enterprises of a dominant position; and concentrations between enterprises which would significantly impede effective competition.

ARTICLE 10.3

Implementation

1.      Each Party shall maintain its autonomy in developing and enforcing its competition law.

2.      Each Party shall maintain authorities which are responsible for the full application and the effective enforcement of its competition law and ensure that they are appropriately equipped and have the powers necessary for fulfilling their responsibilities.

3.      All enterprises, private or public, shall be subject to the competition law referred to in Article 10.2 (Legislative Framework).

4.      Each Party shall apply its competition law in a transparent and non-discriminatory manner, including to private and public enterprises, respecting the principles of procedural fairness and rights of defence of the enterprises concerned.

5.      The application of competition law shall not obstruct the performance, in law or in fact, of the particular tasks of public interest assigned to the enterprises in question. Exemptions from the competition law of a Party shall be limited to tasks of public interest, proportionate to the desired public policy objective and transparent.

SECTION B SUBSIDIES

ARTICLE 10.4

Principles

1.      The Parties agree that a Party may grant subsidies when they are necessary to achieve a public policy objective. The Parties acknowledge that certain subsidies have the potential to distort the proper functioning of markets and undermine the benefits of trade liberalisation. In principle, a Party should not grant subsidies to enterprises providing goods or services if they negatively affect, or are likely to affect, competition and trade.

2.      An illustrative list of public policy objectives for which a Party may grant subsidies, subject to the conditions set out in this Section, includes the following:

(a)     making good the damage caused by natural disasters or exceptional occurrences;

(b)     promoting the economic development of areas where the standard of living is abnormally low or where there is serious underemployment;(c)     remedying a serious disturbance in the economy of one of the Parties;

(d)     facilitating the development of certain economic activities or of certain economic areas, including but not limited to, subsidies for clearly defined research, development and innovation purposes, subsidies for training or for the creation of employment, subsidies for environmental purposes, subsidies in favour of small and medium-sized enterprises as defined in the Parties' respective legislations; and