The COMESA Competition Commission Board of Commissioners, at its meeting held on 2nd April 2019 approved three competition guidelines after severe consultations with National Competition Authorities of COMESA Member States; lawyers in the region and beyond; and other stakeholders.
The guidelines now make it easier for every business manager and particularly seems to call upon Chief Executive Officers and board of directors of every company within the COMESA regional block to scrutinize every business practice and how these practices affect their competitors in the region, markets and consumers.
Of great interest is that the COMESA rules and regulation also restrict government excesses, decisions and omissions, as seen from an increasing trend of private companies raising complaints against governments in the COMESA regional block.
The effectiveness of the Competition Commission still remain to be assessed, and its quite difficult see which criteria is best to use in determining this effectiveness. What is known however, is that huge and crippling fines can be imposed against companies found to be in breach of the regional competition rules and regulations.
The guidelines also act as a caveat to all business entities operating outside the COMESA regional trade block, but whose goods and services find markets within any of the COMESA member countries. The rules and regulations put them on high alert in following to the letter, the COMESA COMPETITION rules and regulations.
The guidelines come in to give deeper explanatory notes on the interpretation of the COMESA rules and regulations and cover three main competition area that are of increasing concern to businesses, national governments and consumers.
Guidelines on Market Definition, this provides the framework applied by the Commission when assessing competition cases including mergers and acquisitions, abuse of dominance and vertical and horizontal restrains. The same Guidelines further provides users of the Regulations predictability in regards the Commission’s approach to market definition
Guidelines on Restrictive Business Practices deals with the application of Article 16 (1) of the Regulations and it was prepared with the aim to provide clarity and predictability as regards the general analytical framework of the Commission in determining cases of vertical and horizontal agreements.
Guidelines on Abuse of Dominance deals with the application of Article 18 of the Regulations and it was prepared with the aim to provide clarity, predictability and transparency as regards the general analytical framework employed by the Commission in determining cases of abuse of dominance.
Brief About the COMESA COMPETITION COMMISSION
COMESA is a regional organization which came into force in 1994 and is celebrating 25 years this year. In 2000, it launched the Free Trade Area with 9 participating countries. Today, it consists of 19 members where 13 countries have eliminated all customs duties on the COMESA imports. These countries include: Djibouti, Burundi, Comoros, Egypt, Kenya, Libya, Madagascar, Malawi, Mauritius, Rwanda, Sudan, Zambia, and Zimbabwe.
The COMESA is an important body or institution for every business minded Chief Executive Officer, board of directors, shareholders and business or trade associations. It consists of 11 institutions or agencies, the Competition Commission included that shape business in Eastern, Central and Southern Africa.
The COMESA Competition Commission commenced its operations on the 14th of January 2013 and is a regional corporate body established under Article 6 of the COMESA Competition Regulations.
In order to ensure fair competition and transparency among economic operators in the region, COMESA enacted the regional competition law and policy to harmonize existing national competition policies to avoid contradictions and provide a consistent regional economic environment.
The Regulations were promulgated in 2004 pursuant to Article 55 of the Treaty establishing the Common Market for Eastern and Southern Africa (“the Treaty”). The Commission is responsible, among other things, for promoting competition and enhancing the welfare of consumers in the Common Market.
The main functions of the Commission are to prohibit, monitor and investigate anti-competitive business practices, control mergers and other forms of acquisitions in the Common Market and mediate disputes between the Member States concerning anti-competitive conduct.
The COMESA Competition Commission is the first regional competition authority in Africa and the second in the world, after the European Competition Authority. It is charged with the enforcement of the regulations.
The introduction of the regulations created a ‘One Stop Shop’ for the assessment of cross border transactions thereby reducing the burden and cost of doing business in the region, given that such transactions no longer need to be examined in each Member State. The COMESA regime also provides the only and most extensive network of national competition authorities in Africa. The Commission, in its enforcement of the regulations, enjoys international legal personality in the territory of each Member State and the legal capacity required for the performance of its functions under the Treaty.
The Commission also plays an advocacy role in handling complaints relating to anti-competitive business practices and other unfair business practices; and has established a ‘Fast-Track’ platform to deal with day-to-day complaints. The rate of mergers and acquisitions taking place in all the COMESA Member States is an indication of the attractiveness of investing in the Common Market. This is so because mergers now represent the most favoured method for investing in Africa. The Competition Commission is headquartered in Lilongwe, Malawi.
Current and Former COMESA Member States