Click here for the advisory report. The management summary of the report is in English. You can also view the most important laws and regulations concerning the price regulation of asphalt on this page.
The Fair Trade Authority Curaçao (FTAC) received a request the provide advice on October 4, 2017 as referred to in Article 2.17 of the National Ordinance on competition. The Ministry of Economic Development issued the request. They requested the FTAC to advice on the expected effects on competition if the current price-cap of asphalt is withdrawn.
Based on their analysis, the FTAC advises not withdraw the price-cap for asphalt for the upcoming years. The current asphalt market is not ready for the withdrawal of the price regulation. An important reason is that there’s currently a risk that the plants will coordinate their market behaviour, in order to reduce competition or not compete with each other. If that is indeed the case, it will cause the market to function more as a monopoly. If the price-regulation is withdrawn, the asphalt prices will probably increase.
Instead, the FTAC advises to modernize the price regulation of asphalt. The way the price-cap of asphalt is calculated, has not changed since 1995. It is determined based on the (regulated) prices of bitumen and limestone. Other developments, such as a decline in the demand of asphalt, does not have an effect on the determination of the price-cap and the method does not contain direct incentives that stimulate the plants to produce more efficiently and innovatively.