10 July 2023
By Jet Damazo-Santos

Sometime around late October in 2022, Michael Aguinaldo received a call from Philippine economic and development secretary Arsenio Balisacan, asking if he would be interested in taking over the post he left as chairman of the country's antitrust regulator.

"So I asked him, 'what exactly do you do there?'," Aguinaldo recounted in an exclusive interview with MLex from his office at the Philippine Competition Commission, or PCC, in Manila.

The response might not immediately inspire confidence in the person taking over the reins of the PCC for the next seven years, but Balisacan — the founding chairman of the regulator and a renowned economist — had an important reason for tapping Aguinaldo.

"He was of the impression, correctly, that I'm not tied or beholden to big business," Aguinaldo told MLex. "Even though I did work for a law firm before, I'm not really identified with any of the major players."

From audit to antitrust

Aguinaldo had almost two decades of private law practice under his belt when he was recruited by the late former President Benigno Aquino III, referred to locally as Pnoy, to join his administration in 2011.

"That was out of boredom," he laughed, before explaining why he made the jump from one of the country's top-tier law firms, Romulo Mabanta Buenaventura Sayoc & de los Angeles, to the government.

"I was in [private] practice for 19 years. I was already a partner, executive committee member, so I was probably looking for a different challenge, something new. And I thought it was interesting, because, you know of course, Pnoy is a very honest president. So I said it might be a good time to join. And, in fact, it was and it worked well."

Under Aquino, Aguinaldo served as the Office of the President's deputy executive secretary for legal affairs, and as head of the investigation and adjudication office. In the latter office, which used to be the Presidential Anti-Graft Commission, he carried out integrity initiatives in line with the United Nations Convention Against Corruption.

He had planned to stay in government for just one or two years, but ended staying four years before Aquino appointed him in February 2015 to a seven-year term as chairperson of the Commission on Audit, or COA.

It was in this role where he demonstrated his mettle.

In 2021, Aguinaldo earned former President Rodrigo Duterte's ire after COA published audit reports that revealed various government agencies' questionable expenses, including deficiencies in the health department's management of Covid-19 response funds.

In an expletive-laden broadcast in August of that year, Duterte told COA to stop publishing audit reports that "condemned" government agencies. In response, Aguinaldo simply said they would continue to comply with their constitutional mandate to audit government spending.

Learning curve

Integrity is, of course, not the only characteristic needed to become the Philippines' chief antitrust enforcer.

Though Aguinaldo was an accomplished lawyer and has ably led a government agency with 9,000 employees for seven years, one more item on his CV drew Balisacan's attention.

"He saw that I did have a little economics background from my master's degree. Although it's in international economic law, he thought that, you know, I might know something," Aguinaldo said.  He holds a master’s degree with special concentration in International Economic Law from the University of Michigan in Ann Arbor, Michigan.

Still, his first five months on the job have so far been a real learning experience.

"Because … we never really had a culture of competition. And in fact, that word is probably not the right word to use in the Philippine context. Maybe the more appropriate word is competitiveness. Because when you say competition in the Philippines, it means sports. That is what 99 out of 100 people will say," he said.

"But what we really mean, I think, is competitiveness in our business, not really business competition, but business competitiveness. You know, that's what you're striving for."

With the PCC's own surveys showing that after seven years of work, only about 15 percent of businesses in the country are aware of the competition law, this outsider's perspective could therefore be a good thing for the commission. In January, not long after he was appointed and even before he took office in February, he was already saying that one of his priorities would be to raise awareness of competition law.

And for insider stuff he doesn’t know?

“We tend to ask questions and try and understand our own. You don't have people pretending to know more than what they actually do. It's actually working fine so far,” he said.

“We're not experts in economics, but we're here to listen and understand. And we do have capacity building even for our members of the commission themselves.”

Big shoes

As the type to seek new challenges, learning a new area of law and heading an organization full of professionals in that field seem right up his alley. But Aguinaldo knows he has a tough act to follow.

Though the PCC was only established in January 2016, it was able to quickly establish itself as a highly respected regulator in the region. New competition regulators such as Cambodia's, and even older ones such as Indonesia and Malaysia's, have sought training from the PCC, especially in the area of merger control.

"They started out with a powerhouse lineup. If you look at the original members of the commission, that's tough to actually top," Aguinaldo said.

Aside from Balisacan, the founding commissioners included lawyers and economists with either competition law expertise or strong international experience.

"I knew that by reputation, the PCC has this kind of young workforce, very professional, with lots of highly qualified economics graduates, a lot of young lawyers, some of whom left jobs in the private sector to work here," he added.

And so he went into the job with both humility and respect for the people who made the PCC what it is today, while bearing in mind the value he brings as an outsider.

"As you enter government, if you're from the private sector, you have to humble yourself by understanding that you don't know everything. These career people, they know much more than you, but you can catch up really quick," he said.

"Your exposure, on the other hand, helps a lot as well. Seeing it from the eyes of someone in the public who has transacted with the government, there are some things you know as well.”

No ‘grandiose’ plans 

Combined, these two traits will perhaps make for a leadership approach that is both well informed and measured.

"It's important that you understand it first, you understand how things are done. And then once you understand them, you have to start to question, 'Okay, why are we doing it this way? Why don't we do it that way? Another way that you might find more efficient?' But then you'll have to understand why it was done this way in the first place,” he said.

In August, after about six months of understanding how the PCC works, Aguinaldo will sit with the four other commissioners — two of whom were appointed this year as well, and the other two last year — to come up with a strategic plan for the agency. But don’t expect drastic changes or grandiose plans.

“If you're looking for something grandiose when you enter government, you're probably going to be frustrated, because there are so many rules and so on. Accountability is the hallmark of being in government, not as much in the private sector. There's more at stake when you're in government, because there are criminal penalties,” he said. 

“But if you're looking at small victories here and there, there's a lot that you can actually accomplish.” 

Activate your MLex® trial today to unlock more content from this exclusive interview, including: