Tuesday, January 18, 2022

BOCCIM heeds Competition Authority clarion call

The chief executive officer of Botswana Confederation of Commerce Industry and Manpower (BOCCIM), Maria Machailo-Ellis, has called for closer working ties between her organization and the Competition Authority. Responding to concerns that BOCCIM members were not responsive to the CA’s advocacy and educational programs, Machailo-Ellis said it was in BOCCIM’s interest to forge closer working ties with the CA and ensure that it delivers on its mandate of promoting unfettered competitiveness by monitoring, controlling and prohibiting anti-competitive trade or business practices.

Earlier, the CA had lamented BOCCIM’s lackluster participation in its stakeholder informational and advocacy programs.

“BOCCIM members have not been very responsive,” said the CA.

The Authority dismissed perceptions within the business community that it was only there to ‘punish’ businesses, insisting that it was a friend of business. While it maintained that indeed punishment awaits those businesses that blatantly breach the law, the CA explained that a critical part of its work is actually to assist businesses with information about how to deal with competition problems they encounter within or outside Botswana. It said competition law can be effectively used to promote and protect the competitive advantage of business. The CA further called on BOCCIM members to participate proactively in its flagship advocacy and informational forum, the National Competition Conference. It further offered BOCCIM free lectures on competition law and how it can be used productively to further business interests.

While the CA has signed MoU’s with the PPADB, DCEC, CAAB, NBFIRA and Bank of Botswana to assist with cooperation and information sharing in investigations, no such agreement exists with BOCCIM. The CA revealed that it has successfully educated public officials on bid-rigging and collusive-tendering, a problem that also exists at BOICCIM.

“However, our outreach programs to the private business sector have not been overly successful and we hope BOCCIM will facilitate closer interaction,” said the CA.

In response, BOCCIM CEO Maria Machailo-Ellis said it was her organization that advocated for the establishment of the CA. She explained that while individual companies might have their reservations about the CA that should not be construed to be the official stand of BOCCIM. She said the CA exists to protect consumers from monopolistic behavior and protect companies that are targets for monopolistic takeovers, such that beneficiary companies would applaud the Authority while those that have failed would not. She added that the CA works in consultation with BOCCIM members and therefore it was wrong to imply that the relationship between the two was acrimonious. Machailo-Ellis also explained that there is a difference between BOCCIM and individual members, such that if individual companies, who might not even be BOCCIM members, fail to honor invitations to participate in certain fora, then it should not be construed that BOCCIM is not cooperating with stakeholders.

“As BOCCIM we are quite happy to act as a bridge between our stakeholders and the business community. We lobbied for the establishment of the CA and it is in our interests that it should succeed. I must encourage many of our stakeholders to engage with the business community through BOCCIM,” she said.

From the day it was launched in January 2012, the CA was bound to clash with business at some point. The greatest challenge for the Authority has always been to evoke pluralistic trust and confidence that would greatly assist in endorsement of its rulings and during investigations. The business community has previously called on the CA to be balanced, ethical and fair and to be careful, when executing its mandate, not to stifle and impede business growth. There were also perceptions that the CA is a toothless bulldog that remains complicit when up against Botswana’s monolithic and politically connected enterprises. But the CA has always insisted that it has teeth to bite because it can impose fines and exert pressure through the High Court. The CA also maintained that it operates independent of political influence as even the Minister of Trade has no powers to overturn its decisions.

The Authority was accused of setting a bad precedent last year when it unconditionally authorized the acquisition of Cezar Hotel in Jwaneng by Cresta Marakanelo even though the hotelier had contravened section 55 of the Competition Act. The CA later released a statement condemning Cresta’s conduct and expressing “great concern and regret that a company of Cresta’s caliber would implement such a transaction without following the law”. Despite its protestations, the CA did not apply section 63(2) of the Competition Act and unconditionally authorized the acquisition. Still last year, the CA was accused of complicity when it “cautiously and reluctantly” approved the acquisition of SupaSave and MegaSave stores by Choppies Enterprises, amid protests from a number of stakeholders. The CA was also forced to backtrack on its decision to reject the merger of BOMAID and AON Holdings. The CA proposed a mutual settlement agreement after the two companies filed notices of appeal to the Competition Commission.

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