Regulators across the continent spent much of last year evaluating and consulting on options to strengthen existing competition legislation, enhance enforcement powers and increase transparency and predictability in competition law enforcement.
There has also been an accelerated focus on competition in digital markets, and public interest considerations continued to take centre stage. Softer, but equally important, were the various initiatives by competition regulators operating nationally and regionally to cooperate on investigations and enhance coordination.
Some notable highlights are set out below.
AfCFTA – the successful implementation of the African Continental Free Trade Area (AfCFTA) agreement will enable firms to do business transcending national borders. This development, however, requires the adoption of market governance approaches to ensure that anti-competitive practices having cross-border effects do not erode the many benefits of the AfCFTA. Intended to guard against this is the Protocol on Competition which aims to provide a continental approach to competition law in Africa. Negotiations on the Competition Protocol have begun, with a view to finalising it during 2022.
Angola – Angola joined the list of African countries to have an active, independent competition regulator when the Autoridade Reguladora da Concorrência (ARC) became operational in 2019. In the same year, the ARC reviewed its first merger, but it was only in 2021 that merger filing fees were introduced. Other materials to support the ARC’s merger control regime and approach to restrictive practices were also published in 2021, and most recently, the ARC launched a whistle-blower portal on anti-competitive practices.
Common Market for Eastern and Southern Africa (COMESA) – the COMESA Competition Commission (CCC) continues to be one of the most active regional competition regulators on the continent. During the past year, the CCC, for the first time, issued a penalty against firms for late notification of a merger. Subsequently, and again for the first time, the CCC fined merging parties for breach of a merger condition. The CCC also launched an investigation against beer producers operating in the common market citing possible market allocation. Various guidelines and practice notes in the amplification of the competition legislation were also published and the CCC indicated that the implementation of a corporate leniency policy is not too far behind.
East African Community – The East African Community (EAC) Competition Authority became operational in 2018, but to date has focused on restrictive practices and is not yet accepting merger notifications. However, plans are afoot to substantively amend the competition legislation in the EAC and its 2016 Competition Act is in the process of being repealed in its entirety. The EAC Competition Bill, 2020 was passed in the Legislative Assembly during 2021, although approval from the Summit is still required before it is brought into effect. Draft Merger Regulations were also published, but these are still following regulatory processes and it is understood that the implementation of the merger regulations may take a while longer.
Economic Community of West African States (ECOWAS) – signalling a shift towards greater competition law enforcement in the region, in 2021 the ECOWAS competition authority published a bid for consultancy services to, inter alia, assess its legal framework and develop operational tools in relation to mergers; assist to develop guidelines on case investigations, enforcement and the levying of penalties; and the adoption of a leniency policy.
Egypt – during the past year, the Egyptian Competition Authority has sought to prosecute firms for failing to notify mergers, and to criminally prosecute firms for engaging in anti-competitive practices. Amendments to Egypt’s principal competition legislation are also being discussed in Parliament. The proposed amendments provide for a wholesale change to the existing merger control regime, and in particular, the adoption of an ex-ante merger notification regime.
Ethiopia – whilst there have been no significant developments in Ethiopia’s competition law regime over the past year, indications are that there may be some changes ahead, relating to the competition regulator and its reporting structures within the Ethiopian Government, ahead.
eSwatini – it is expected that the eSwatini Competition Bill will repeal the current Competition Act in its entirety. Whilst it is understood that stakeholder comment on the Bill closed during 2021, it is not yet known when the Bill will be signed into law.
Ghana – there is, as yet, no dedicated competition law regime in Ghana. However, a draft Competition Bill is receiving further review by the Ministry of Trade and is to be submitted to Cabinet. There is no indication as to when this will be done, although there are various calls to implement competition legislation in Ghana as a matter of urgency and in light of the looming Competition Protocol under the AfCFTA.
Kenya – over the past year, the Competition Authority of Kenya has sought to strengthen its enforcement powers, publishing a host of regulations and guidelines, including for example, Guidelines on Informant’s Reward Scheme Policy; Buyer Power Guidelines; Joint Venture Guidelines; Block Exemption Guidelines on Certain COVID-19 Economic Recovery Priority Sectors; and Retail Code of Practice, including template contracts to reduce disputes in the retail and insurance sectors and ensuring compliance with competition and consumer protection laws.
Malawi – the Competition and Fair Trading Commission aims to strengthen its enforcement powers in Malawi and had published, amongst a closed group of stakeholders, a series of guidelines on: abuse of dominance; collusive conduct; resale price maintenance; predatory pricing, price discrimination and tying; market definition; and public interest.
Mauritius – in the past year, the work of the Mauritius Competition Commission (MCC) ranged from reviewing merger notifications to prosecuting firms for anti-competitive practices. During the year, the MCC ordered its first divestiture in a merger context; launched investigations into advertising incentives offered to real-estate agents; began investigations into exclusivity in the local fly ash market and into match fixture lists; published a report on the outcome of its market study in the airline industry; and reviewed various mergers across the COMESA Common Market.
Mozambique – Mozambique’s competition law framework was adopted in 2013, but operationalisation of the Competition Regulatory Authority (CRA) stalled thereafter. In 2021, the CRA became operative and began receiving notification of mergers. In the same year, the CRA published merger notification forms and issued a decree on the payment of merger filing fees. Now that merger notifications are regularly being filed with the CRA, the CRA is turning its attention towards anti-competitive practices, indicating that its future enforcement priorities will be in the fields of cement and construction; beverages; consumer goods, in particular, flour, vegetable oils, soap and sugar; pharmaceuticals; financial services; and telecommunications.
Namibia – the Namibian Competition Commission published the Namibian Competition Bill in 2020, which proposes a repeal of the existing Competition Act and the introduction of sweeping changes to the competition law regime in the country. The Bill remains in draft form and no timelines for its implementation have yet been determined.
Nigeria – during the year, and following an extensive lobbying process, the Federal Competition and Consumer Protection Commission (FCCPC) adjusted its merger filing fees, lowering its fees in some respects but also increasing its fees in other respects. The FCCPC also launched an electronic portal via which merger notifications may be submitted, pre-consultations may be arranged, and providing a filing fee calculator. In relation to anti-competitive practices, the FCCPC conducted raids at the offices of various shipping companies for alleged violations of the Federal Competition and Consumer Protection Act, 2019, and also invited public comment on proposed regulations relating to restrictive agreements and trade practices and abuses of dominance.
South Africa – 2021 was another busy year for the South African Competition Commission and Department of Trade, Industry and Competition, with both agencies working together to regulate and enforce competition law in the country more stringently. Notable highlights include the launch of a market inquiry into online intermediation platforms; publishing revised draft small merger guidelines intended to capture small mergers taking place in the digital sector that fall below the thresholds for mandatory merger notification; a competition policy for jobs and industrial development; draft guidelines on collaboration among competitors on localisation initiatives; and proposed amendments to merger notification forms.
Zambia – the Zambian Competition and Consumer Protection Commission (CCPC) prosecuted a number of firms this year for engaging in anti-competitive behaviour, including price fixing and collusive tendering. Contravening firms were fined as much as 10% of their annual turnover, being the maximum penalty the CCPC is allowed to impose. The CCPC also launched an investigation against independent beer distributors for alleged tying and bundling and facilitating unreasonable price hikes in the market for clear beer products, and also ordered firms in the cement industry to lower their pricing.
Zimbabwe – during the year, the Zimbabwe Competition and Tariff Commission fined merging parties for prior implementation of a merger; launched investigations into the price of cooking oil, as well as exclusivity agreements relating to school uniforms; and indicated its intention to prioritise investigating behaviour in digital markets.
Written by Nazeera Mia, Knowledge and Learning Lawyer: Competition, Bowmans South Africa