Wednesday, November 25, 2020

Competition Commission to hear appeals against decision of Competition Authority on Mergers

The Competition Commission has recently determined that it has the power to hear appeals against the decisions of the Competition Authority on mergers.

This follows the publication of the Rules for the Conduct of Proceedings of the Competition Commission in the Government Gazette. According to the Commission, the Rules set out the procedures to be followed in the adjudication process and will assist those who come before the Commission.

“The Competition Authority can now refer competition cases to the Competition Commission for determination,” wrote the Commission. “Where the Authority has discontinued investigations and not referred a matter to the Competition Commission, the complainant may use the Rules to refer the matter itself to the Competition Commission.”

The Competition Authority, whose main aim is prevention and redress of anti-competitive practises in the economy, is said to be independent from the Commission and other external influences.

On January 11th 2013 the Commission sat for the first time to consider an appeal by BOMAID against a decision from the Competition Authority. Until recently, it was not clear whether decisions of the Competition Authority on Mergers were appealable to the Competition Commission like all other competition issues. Chairman of the Competition Commission, Dr Zein Kebonang, has since advised BOMAID to file the appeal with the Commission.

In their first annual report, ending 31 March 2012, the CEO of Competition Authority, Thula Kaisara, had mentioned that under the 2011/2012 year of review, “the authority’s work, be it investigations or otherwise was not contested before the commission and/or the high court, making it difficult for them to gauge whether they are properly applying competition rules and principles in their investigations and assessment processes.

During the last sitting of the Merger Review Committee in 2012, the Competition Authority rejected a proposed acquisition of shares in MRI Botswana Limited by BOMAID.The Authority alluded that the transaction would not lead to substantial lessening of competition in healthcare administration, emergency medical services, call centre services, and on-site medical clinics in Botswana.

The Authority advised that since BOMAID is already in possession of majority shares in MRI Botswana, the shares held by CEDA venture capital fund should be sold to other citizens who are not already part of MRI Botswana.

“This is meant to ensure that more citizens are economically empowered and wealth is distributed amongst other citizens. The Authority is of the view that the parties to the transaction should seek other alternative citizen buyers to acquire the shares owned by CEDA Venture Capital Fund Limited,” ruled the Authority.

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