On November 20, 2024, the Congress of Guatemala urgently approved Decree 32-2024, the “Competition Law.” This approval marks a significant milestone for the country, aiming to promote a competitive market, attract foreign investment, and boost national economic growth.
The new law seeks to prevent anti-competitive, monopolistic practices or practices that limit market access for small or new Economic Agents (merchants, companies, and corporations). A new regulatory body, the Superintendency of Competition, an autonomous and decentralized entity, will investigate allegations of uncompetitive practices.
The Superintendency of Competition may act on its initiative or after a complaint from a private party. Economic Agents must provide all possible information to determine whether an anti-competitive practice has occurred, through an administrative process prioritizing the right to defense and the presumption of innocence. The law establishes violations and prohibitions and empowers the regulatory body to enforce compliance with sanctions when anti-competitive practices in the Guatemalan market are identified. These sanctions can reach up to two hundred thousand times the minimum wage. Both individuals and legal entities, national or foreign, are subject to this law.
As a result of its approval, the crime of monopoly has been repealed, leaving only economic sanctions. Articles of the Commercial Code, the Consumer and User Protection Law, and the State Procurement Law have also been amended. Furthermore, the law provides for the supplementary application of the Competition Law to Economic Agents governed by sector-specific laws containing competition rules and regulatory authorities, with such sector-specific laws prevailing over the Competition Law. This will likely leave room for case-by-case interpretation.
The law will come into force in two stages: the first beginning in January 2025, and the second two years after its publication.
It should be noted that, as per the legislative process, the law must still be sanctioned by the President of the Republic of Guatemala before being enacted and published.
At BLP, we are pleased to support our clients during this transition and in understanding the new rules brought about by this regulation. We will subsequently conduct in-depth evaluations to provide solid and strategic legal advice.
For more information, contact us at [email protected]