Competition Law and Anti-Competitive Practices in Madagascar

Comprehensive vocabulary flashcards covering the principles of economic liberalization, market structures, anti-competitive practices, and the institutional framework of competition law in Madagascar.

Liberalization

An economic strategy implemented in Madagascar since the mid-1980s aimed at strengthening the economy, improving competitiveness, and encouraging individual initiatives through flexible regulation.

Privatization

The process of transferring property or management of state-owned enterprises or public assets to the private sector to redefine the role of the State.

Freedom of Enterprise

A principle based on the 1791 Le Chapelier law stating that any person is free to conduct trade or exercise a profession, provided they obtain a license (patente).

Freedom of Competition

A corollary of liberalization based on the market mechanism where supply and demand meet, requiring several competitors to operate on equal footing.

Enterprise

Firms, companies, associations, or other legal entities (private or state-controlled) that exercise commercial or industrial activities.

Pure and Perfect Competition

A theoretical ideal market characterized by five conditions: atomicity of agents, product homogeneity, transparency, free entry and exit, and total mobility of production factors.

Practicable Competition (Concurrence Praticable)

A realistic version of competition that recognizes that pure and perfect competition is unattainable and focuses on maintaining sufficient rivalry between firms.

Contestable Market

A market where the threat of potential entry disciplines incumbent firms due to the absence of barriers to entry and exit.

Relevant Market (Marché Pertinent)

The framework of analysis for competition, defined by both the product market (substitutable goods) and the geographical market (the territory where competition conditions are homogeneous).

Cross-Elasticity of Demand

A criterion used to delimit product markets by measuring the percentage increase in demand for product $A$ following a price increase in product $B$.

Structural Barriers

Entry obstacles resulting from basic industry characteristics such as technology, absolute cost advantages, capital requirements, or legal patents.

Strategic Barriers

Barriers to entry created by the deliberate actions of existing firms, such as over-investing in equipment or excessive advertising to deter new competitors.

Sunk Costs (Coûts Irrécupérables)

Fixed costs that cannot be recovered when a firm exits a market, serving as a barrier to exit and increasing the risk of entry for new players.

Marginal Cost

The additional cost required to produce one additional unit of a product; in perfect competition, price is ideally set at this level.

Monopoly

A market situation where there is only one seller who has total power over price and production due to the absence of competitors.

Natural Monopoly

A situation occurring when economies of scale are so significant that it is more efficient for a single firm (like electricity or water distribution) to serve the entire market.

Monopsony

A market structure in which there is only one buyer, giving that buyer significant power to influence the prices of production factors.

Oligopoly

A market situation with a small number of sellers who are conscious of their interdependence regarding price and production decisions.

Anti-Competitive Practices

Acts such as ententes (cartels) or abuse of dominant position that are intended to hinder, distort, or suppress the free play of competition.

Horizontal Entente

An agreement concluded between competitors at the same market level (e.g., price fixing, market division, or production quotas).

Vertical Entente

An agreement between operators at different levels of the production and distribution chain, such as between a producer and a distributor.

Exclusive Distribution

A system where a supplier agrees to sell products within a certain territory for a specific period only to one designated distributor.

Selective Distribution

A system where a supplier limits the number of distributors based on qualitative or quantitative criteria, such as technical qualifications or brand prestige.

Abuse of Dominant Position

When a firm uses its economic power to hinder effective competition, such as by imposing unfair prices, limiting production, or practicing discrimination.

Predatory Pricing (Prix d'éviction)

Fixing prices below production costs with the intent to eliminate competitors before raising prices once a monopoly is achieved.

Rule of Reason

A legal principle used to evaluate whether an agreement is anti-competitive based on its actual effects and potential economic justifications (exemptions).

Economic Dependence (Dépendance Économique)

A situation where a company has no equivalent solution but to work with a specific supplier or client due to their market power or brand reputation.

Merger Control (Contrôle des Concentrations)

The oversight of fusions, acquisitions, or takeovers by a competition authority to prevent the creation or reinforcement of a dominant position.

Unfair Competition (Concurrence Déloyale)

Commercial acts contrary to honest practice (usage) that cause damage to a competitor, giving rise to civil liability rather than criminal sanctions.

Disparagement (Dénigrement)

A form of unfair competition involving malicious assertions intended to discredit a competitor's person, products, or establishment to divert their clientele.

Parasitism (Parasitisme)

Unfairly profiting from the investment, reputation, or efforts of another company by copying their slogans, ideas, or advertising style.

Infringement (Contrefaçon)

The unauthorized reproduction or imitation of intellectual property (patents, trademarks, copyrights) treated as a criminal offense.

Patent (Brevet)

An industrial property title granting an exclusive right of exploitation for a new invention for a limited period, typically $20$ years.

Interim Measures (Mesures Conservatoires)

Urgent measures granted by a competition authority to suspend a practice or return to a previous state when a practice causes immediate, grave harm.

Council of Competition (Conseil de la Concurrence)

An independent, quasi-judicial body composed of judges and experts responsible for monitoring markets, investigating anti-competitive practices, and imposing fines.