Competition Commission due for June

MBONGENI MGUNI
Staff Writer | Friday February 19, 2010 00:00

 

The Competition Act, passed last year, establishes the Commission and the Competition Authority, headed by a Chief Executive Officer and technical staff charged with ensuring fair play in industry. The Commission will be the Authority's adjudicating body. On Wednesday, the Minister of Trade and Industry, Dorcas Makgato-Malesu told BusinessWeek that the selection of commissioners was ongoing and would be followed by the recruitment of a CEO.

'Once the commissioners are in place, they will go about setting up the organisation which includes the employment of the CEO. Once the organisation is up and running, there will be an education process for Batswana to understand what's contained in the law, what they can do if they are disgruntled or when they have not been helped satisfactorily. 'This Commission will build capacity among our lawyers as it is a new field for them; there will also be capacity building in other areas such as the corporates, government etc,' she said.

Makgato-Malesu said the Commission was of importance to government as a tool with which to ensure fair play in industry. 'We have big players in the industry who have been enjoying themselves without stringent rules and we are going to be enforcing these. 'The Commission will also help sort out gaps in consumer protection, as the existing policies and laws do not have enough teeth,' she said. The Competition Commission and Authority are expected to root out price-fixing, bid rigging, market division and other corrupt business practices. For instance, the two organisations will act when businesses collude to divide markets by allocating customers, suppliers, territories or specific types of goods and services.

They will also take action when supplier 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 the offending companies turnover during the breach of the Competition Act, up to a maximum of three years. Individuals who fail to attend adjudication hearings or fail to produce documents the Commission deems relevant to investigations, are liable to fines of P30, 000 or to prison terms not exceeding two years or both.

The Competition Act, a sequel to the Competition Policy, was informed by a 2005 survey indicating market dominance of select players in certain sectors of the economy. The survey found that these firms enjoyed substantial market power, jeopardising the public procurement process and exposing it to collusion among bidders.

The survey also noted the increasing dominance of foreign companies in the economy and the need to institutionalise citizen economic empowerment.

Meanwhile, the Trade and Industry Minister has revealed that the National Export Strategy and National Investment Strategy are being hammered out through consultation with the private sector. Makgato-Malesu said both policy documents were in the final stages of consultation with expectation of implementation by the end of the first quarter.