Competition Law at Nicaragua
Here's an overview of Competition Law in Nicaragua:
Competition Law in Nicaragua
1. Legal Framework:
The primary legislation is Law No. 601 – Law for the Promotion of Competition, enacted in 2006.
The law establishes the rules for fair market competition and aims to prevent monopolistic and anti-competitive practices.
It is enforced by the National Institute for the Promotion of Competition (Procompetencia).
2. Objectives:
To promote and protect competition in the Nicaraguan market.
To prevent and sanction monopolistic practices and abuse of market dominance.
To improve economic efficiency and consumer welfare.
3. Key Provisions:
Prohibited Agreements (Horizontal and Vertical):
Agreements between competitors (cartels) that fix prices, limit production, allocate markets, or rig bids are prohibited.
Vertical agreements (between suppliers and distributors) that unreasonably restrict competition are also regulated.
Abuse of Dominant Position:
Companies with dominant market power are prohibited from abusing their position.
Prohibited conduct includes predatory pricing, exclusive dealing, refusal to supply, and unfair pricing.
Merger Control:
Mergers, acquisitions, or other economic concentrations must be reported to Procompetencia if they meet certain thresholds.
The authority can approve, block, or conditionally approve transactions that may reduce market competition.
Unfair Competition:
Includes misleading advertising, discrediting competitors, or using confidential information unlawfully.
4. Enforcement:
Procompetencia has the power to:
Investigate potential violations.
Issue fines and orders to cease anti-competitive behavior.
Approve or reject economic concentrations.
Companies and individuals found in violation may face administrative sanctions, including fines based on turnover.
5. Challenges and Context:
Nicaragua’s enforcement of competition law is still evolving, with limited resources and a need for stronger institutional capacity.
Political and economic conditions can influence the strength and independence of regulatory actions.
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