Cabinet considers shortlist of Competition Authority CEO

MBONGENI MGUNI
Staff Writer | Friday December 3, 2010 00:00

The long-awaited Competition Authority is expected to take the form of a dynamic crack unit that will tackle anti-competitive behaviour in the public and private sectors.

The Authority, and its adjudicating body, the Commission, will root out price-fixing, bid rigging, market division and other corrupt business practices.

With seven Commissioners already appointed, attention has shifted to the employment of the Authority's CEO who will then lead the recruitment of key staff.

Following this, the new organ will begin receiving reports from an industry that has long been clamouring for a competition body to investigate complaints, penalise culprits and level the playing field.

This week, the Chairman of the Competition Commission, Zein Kebonang, told BusinessWeek that the successful candidate for the Authority would be known after Wednesday next week.

The three candidates due for consideration by the Cabinet emerged from 66 candidates who applied and from whom an initial eight were interviewed. From these final eight, six were citizens and three female.

'We should know the successful candidate by next Wednesday,' Kebonang said. 'The names submitted to Cabinet went through vetting and secured comments from the various ministries before being sent back to the Ministry of Trade and Industry, which compiled a Cabinet memo.

'The names will first go to a Cabinet committee of four before going to full Cabinet. Following that and other processes, an announcement will be made.'

While the ministry has ranked the names submitted to Cabinet, the Executive has the liberty to select a lower ranked candidate or reject the entire list. After Cabinet endorsement, the ministry will make an offer to the candidate, who will commence official duties in the first quarter of next year.

The Competition Commission and Authority are stated government priorities whose establishment is being fast-tracked in response to industry demands. Indicative of this, barely seven months passed between the passing of the Competition Act last December and the appointment of commissioners.

Government was able to fast-track the two bodies by effecting sections of the Act dealing with institutional framework, organisational establishment and sources of funding. Other sections deal with the organisations' mandates and operations.

Besides other functions, the two bodies will also take action when suppliers or producers attempt to make their recommended prices to retailers binding. The organisations have the power to impose a penalty not exceeding 10 percent of an offending company's turnover during the breach of the Competition Act for up to a maximum of three years. Individuals who fail to attend adjudication hearings or to produce documents the Commission deems relevant to investigations are liable to fines of P30, 000 or prison terms not exceeding two years or both.

The Competition Authority will also probe and regulate mergers and acquisitions, with the law requiring transactions of this nature above a certain threshold to be undertaken with the Authority's notification.

The Competition Commission and Authority's establishment are a boon to private sector players, particularly Small, Micro and Medium Enterprises (SMMEs) and citizen-owned enterprises who have long decried unfair trading practices by larger entities.

Other players in the industry, such as hoteliers and retailers, have also welcomed the development which they expect will tackle price-fixing cartels in certain supply industries.