Monopolistic competition has some issues and problems associated with it. Such competition is inefficient and impossible to regulate fully even by government regulators.
When monopolistic competition sets prices for each product they are hard to regulate because the benefits of this are just few and far between, and also the market may be to big to regulate. In such circumstances the marginal costs are less than the market prices over lengthy time periods. Such competition allows for the use of powerful advertising and product branding that is hard to compete with even if the market is monopolized by the consumer demand for that product from just one single company.