Saturday, May 8, 2021

CA retrained staff, engaged KPMG after bungling panel beaters’ case

Following a debacle involving an investigation of two vehicle panel-beating companies that it suspected of colluding, the Competition Authority got its act together by retraining its staff as well as by “streamlining the coordination of investigations.”

This revelation is made by Thula Kaira in the Chief Executive Officer’s statement in the Authority’s 2014/15 annual report. Acting on the conviction that Car World Auto Craft Shop and Auto Tronics had issued cover quotations to clients for insured vehicles that needed repairs, the Authority instituted legal proceedings against the companies at the Competition Commission. It had determined that the possible effect of such anti-competitive conduct would be high insurance costs to customers. The matter didn’t go anywhere because the Authority withdrew the case upon realisation that the respondents were not formally notified that they were being investigated as the Competition Act requires.

“This omission nullified the investigations and rendered the complaint referral dismissable,” the annual report says about this matter.

Kaira says that besides the retraining of staff, the Authority engaged KPMG – is one the largest audit, tax and advisory firms in the world which has offices in Botswana. In addition to internal audit work, the company’s staff also reviewed the Authority’s investigation process “and their recommendations have been under implementation.”

The report mentions, as one of the major challenges that it faces, the conflicted roles that officers in the Department of Legal and Enforcement have to play in the execution of their duties. The same officers who investigate cases end up prosecuting them. Likewise, the same officers conducting investigations conduct field research.

“This led to delays in completion of both research and investigations and also a huge workload for the staff. The quality of the investigations output was therefore compromised and the shortage of manpower tended to slow down progress on cases. To address this challenge, the Authority engaged external counsel for some cases and also put in motion steps to create an Investigations Unit which will be responsible for carrying out investigations only, leaving prosecution to the Legal and Enforcement team,” the report says.

In a case in which two companies are alleged to have rigged a sugar beans tender, pocketing some P114 million in the process, the external counsel that the Authority engaged was Abel Modimo, a Gaborone lawyer. In terms of the sums of money involved, this is the largest case the Authority has brought before the Competition Commission. In the year under review, the Authority’s legal expenses came to a total of P737 777. 

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