EXCITING TIMES AHEAD FOR FCCC

For the first time, FCCC has a Strategic document in place which entails the key objectives and goals to be achieved from 2018 to 2023.

The Fijian Competition and Consumer Commission (FCCC) has come a long way since its establishment from the merger of three separate agencies in 2010. Over the years we have grown in confidence and the capability which paves the path for the achievement of our set targets.

There is no looking back for us and as we venture into our five-year plan with the expectation to achieve a lot more.

FCCC’S STRATEGIC PLAN – 20182023

For the first time, FCCC has a Strategic document in place which entails the key objectives and goals to be achieved by us from 2018 to 2023.

Being Fiji’s national regulatory and competition agency, our purpose is to achieve the best possible outcomes in competitive and regulated markets for the long-term benefits of all Fijians. Our Strategic Plan incorporates significant features of the National Development Plan (NDP), (2017 – 2021 and 2017 – 2036) to enable inclusive socio-economic development.

We are working in congruence to actively contribute towards the realisation of the development goals, conclusive of the progress of the private sector, civil society, community groups, the government and all Fijians.

Our progressive and forward thinking Strategic Plan embraces the fundamental principles of our National Development Plan and will promote greater self-regulation, voluntary compliance, and contributes towards ‘Transforming Fiji’.

Strategic Goal 1 - Markets for goods and services in Fiji are competitive

When firms compete, they seek to deliver goods and services at better prices and superior quality and consumers benefit from these better prices and the economy gains from having more productive firms.

Setting the right conditions to encourage competition can also drive innovation as firms compete to improve their market share.

It is the role of the FCCC to promote compliance with the Fijian Competition and Consumer Commission Act 2010, including, by enforcing the law against those who infringe it.

In order to assist it in performing this role, FCCC will seek various changes to the Act, including to allow it to accept enforceable undertakings from businesses and to strengthen its powers to gather information during investigations.

These changes will help FCCC achieve results that have market-wide benefits for businesses and consumers.

FCCC’s objectives for competitive markets are:

• Businesses understand and comply with their obligations under the Fijian Competition and Consumer Commission Act.

• Competition among businesses is effective and fair.

• Changes to market structure do not substantially increase market power unless any likely detriment is outweighed by the overall benefit to the public.

• Barriers to entry and exit are minimised.

• Terms of purchase are fair and businesses do not use market power to tilt the terms of trade in their favour to the detriment of their customers.

Strategic Goal 2 - Consumers in Fiji are offered goods and services that are safe and are provided with adequate and accurate information about goods and services.

A fundamental aspect of competitive markets is that consumers can be confident that they understand what they are purchasing and what price they will pay.

Equally, businesses and traders who act with integrity must be confident that they will not be undermined by unethical traders who do not provide accurate information to consumers. It is important that consumers are able to make informed choices. FCCC’s objectives for consumer protection are to ensure that:

• Businesses understand the consumer protection rules and abide by them.

• Information provided to consumers by traders is accurate, complete and true.

• Consumers understand the full terms of their purchases.

• Terms of purchase are fair and businesses do not use bargaining power to tilt the terms of trade in their favour to the detriment of consumers.

Strategic Goal 3 - Regulation, including price control, is applied where competition is not effective, and efficient outcomes can be achieved without imposing excessive administrative or compliance costs

The Fijian economy is characterised by differing opportunities for consumers and businesses depending on whether they are based in rural areas or urban areas.

These differences are aggravated by adverse events such as cyclones or other natural disasters.

For this reason, FCCC is responsible for setting the prices of a range of consumer products.

In addition, there are natural monopolies where effective competition is unable to be relied upon to deliver efficient prices for consumers.

In such cases, these industries are regulated.

FCCC’s regulatory functions can be separated into two different categories:

Price and rent control: FCCC has responsibility for setting the prices of a wide range of consumer goods at wholesale and retail levels. It also monitors compliance with the rent freeze on residential properties market.

To set the prices of controlled consumer goods, FCCC adds a wholesale and retail margin to the landed cost of goods.

This margin reflects the distribution costs of the goods as well as a fair profit for the wholesaler and retailer.

FCCC believes that it is appropriate to investigate possible changes to the process of setting the prices of consumer goods to reduce the cost for all parties, aid compliance, and protect consumers.

Regulated industries: The methodology used by FCCC to determine the prices of services provided by regulated industries also takes a cost-plusmargin approach.

It is challenging to identify the correct costs of a regulated entity.

If the costs accepted by FCCC are too low, the entity faces no incentive to invest and consumers will not receive the right amount and quality of the service; if costs are too high, the entity earns a monopoly profit, which again harms consumers.

In order to identify economically efficient costs, FCCC will investigate the use of alternative regulatory models for setting regulated prices. Although no single regulatory model can be used for all regulated industries, there are some common regulatory principles and approaches that would allow FCCC to set economically efficient prices and quality standards.

FCCC’s objectives for the pricing of consumer goods, rents and regulated industries are that:

• Where effective competition is unable to be sustained, the price of consumer goods reflects the costs of the goods including distribution costs and a fair margin.

• Residential rents are fair for the tenant and the landlord.

• Regulatory decisions set prices and quality standards that reflect efficient costs, remove monopoly prices and provide an incentive to invest.

• Regulated businesses should have regulatory certainty and smooth price paths.

Strategic Goal 4 - FCCC is regarded as an independent and expert body by the public, the Government and businesses

Achieving our Strategic Goals will require FCCC to develop its capability and make changes to its own internal processes and management framework.

FCCC’s objectives for its management framework are that:

• FCCC is respected as an independent and competent economic regulator and enforcement agency.

• FCCC has staff that is engaged, professional and has the capability to deliver FCCC’s Strategic Goals.

• FCCC’s resources are used efficiently and are allocated to achieve FCCC’s Strategic Goals.

• FCCC is funded to an adequate level, from an appropriate combination of sources, to perform its roles.

• FCCC manages risk and meets all of its accountability reporting deadlines.

Competent workforce

In order to realise our goals and objectives, FCCC is committed to ensuring a competent workforce. Every department has qualified officers to look into the respective functions of Economic Regulation, Price Control and Monitoring, Competition and Compliance and not forgetting the much-needed support function of the Corporate division.

We will continue to provide capacity building to enable our staff to administer removal of restrictive and unfair trade practices from Fijian markets and boost confidence in achieving our vision to create a dynamic and competitive market in Fiji.

FCCC has recently incorporated two new positions into its hierarchy which will be instrumental in providing core support to the work undertaken by us. One key recruitment made was that of the Internal Auditor to ensure accountability and transparency of the organisation.

This is the first time ever that an internal audit function has been setup and it was imperative to do so to promote good governance, be in synchronisation with the Public Service values, government mandate, 2013 Constitution, and promote anti-corruption.

The internal auditor has already begun work on streamlining the processes and structures implemented by the board towards the achievement of FCCC’s overall objectives.

Extensive staff training will be done to ensure they are aware of what is expected of them.

Further, a Communications Officer has been recruited who can ensure timely dissemination of information to the media, stakeholders and members of the public.

The outcomes of the extensive activities undertaken by FCCC needs to be made known and communications are key in creating awareness.

Fostering partnership

FCCC we will be actively pursuing a trusted collaborative working relationship with the industries and our strategic partners.

This will enable effective good governance, risk management, detection and disruption of restrictive and unfair trade practices.

Our effective regulation of markets will continue to play an important role in Fiji’s economic growth. FCCC is committed to fostering a competitive, efficient, fair and informed market with initiatives to modernise the regulatory environment through a culture of excellence while growing our presence at a national and regional level.

These are exciting times for the FCCC and I am excited to lead the organisation with its committed professionals towards constructing enduring foundations for our future.