Malawi hosting 7th annual Competition and Economic Regulation Week

From tomorrow, September 12-16, Malawi’s Competition and Fair Trading Commission (CFTC) is hosting the 7th annual Competition and Economic Regulation (ACER) week in Salima — a conference that provides a valuable platform to, amongst other, build networks for collaboration between agencies competition authorities.

Held in conjunction with COMESA Competition Commission (CCC) and the University of Johannesburg’s Centre for Competition Regulation and Economic Development (CCRED), the ACER dates other regulators to share knowledge and keep abreast of key developments across the region.

Acting Executive Director Apoche Itimu

In a statement from CFTC’s acting Executive Director, Apoche Itimu said the week will include three professional training programmes, which will run concurrently from tomorrow to Wednesday (September 14) and thereafter a conference from September 15-16, which will be opened by Minister of Trade & Industry, Mark Katsonga Phiri.

“The three targeted professional training programmes will cover key concepts in economic regulation, competition economics and law with illustrations on how the theories and principles are applied,” Itimu said.

“On the other hand, the ACER conference seeks to address issues of direct interest to competition authorities, economic regulators and industrial development practitioners in Africa.

“The Commission is honoured to co-host the ACER week alongside CCC and CCRED, as part of enhancing its collaboration and cooperation with international bodies in the enforcement of competition and consumer protection laws and capacity building,” she said.

For more information, the public is encouraged to contact publicist, Innocent Helema on +265 880 725 075 or email [email protected].

Of late, the CFTC has successfully made many determinations on unfair trade practices in favour of complainants — an indication that the public has come to terms of the importance of the regulator that protects the interests of the business community and the consumer.

At its 61st meeting on March 28, the CFTC considered and adjudicated over a total of 69 cases, which included 55 cases of unfair trading practices and 14 cases on anti-competitive business practices, and ordered a total K11.89 million for companies to pay as fines and refund, for committing different offences under the Competition and Fair Trading Act (CFTA).

The companies included Old Mutual Pension Services Company Limited; Peoples Trading Centre; misleading and unconscionable conduct by King Steel Limited; Central Poultry (2000) Limited; Chipiku Plus; Suncrest Creameries Limited; Vanguard Life Assurance Company; Platinum Finance Limited as well as alleged unconscionable conduct against 15 private schools.

One major case involving Malawi Bureau of Standards (MBS) and the Directorate of Road Traffic & Safety Services (DRTSS) was referred to the Anti-Corruption Bureau (ACB) to investigate if there was any element of corruption involved from the case — in which the two government agencies were found guilty of anticompetitive conducts on the importation and supply of retro-reflective blank number plates into Malawi.

CFTC still fined MBS and DRTSS K500,000 for engaging in the anticompetitive conducts when they granted waiver to private firm MOVESA, as sole importer and supplier of number plates, yet the company had failed to meet specific standards.

MBS and DRTSS has also been ordered to “cease and desist from engaging in anticompetitive conducts in the enforcement of standards regarding the importation of blank number plates”.

The two government institutions were also ordered to “comply with and enforce enacted legislation and/or approved procedures in the regulation of the importation of blank number plates in Malawi”.

Plates supplied by MOVESA that failed regulation standards

The complainant, Bulldog had already petitioned the ACB last year on MBS and DRTSS decision to award MOVESA as the sole blank number plate importer made in 2010 — suspecting that “there might be an element of corruption” involved in the process.

The complainant, Bulldog, has since take the case further through the High Court since CFTC determined that MBS and DRTSS engaged in anticompetitive conducts after the motor services company and been allowed to import 6,000 blank number plates only to declare them that they failed the test under MS639-1 Standard.

However, CFTC determined that MBS and DRTSS appeared to have contravened Section 32(1) of the Competition and Fair Trading Act (CFTA), and the Commission “found that in spite of the fact that Bulldog, MOVESA and other competitors all failed conformance tests under the MS639-1 Standard during the same period, only MOVESA was allowed to import a consignment that had failed a conformance test”.

The verdict further said: “The Commission found that the reasons given for having granted a waiver to MOVESA only to do so were unlawful and unjustifiable resulting in MOVESA being granted unfair advantage against its competitors.

“The Commission found that DRTSS engaged in anticompetitive conduct by taking steps to seek a waiver from MBS on MOVESA’s behalf on the alleged grounds that if the waiver was not given there would be a shortage of number plates in the country and yet all the other competitors who had also failed the conformance tests could have also done so (though not lawfully as they had also failed the conformance test).

“Further, the Commission found that the reason for seeking a waiver on MOVESA’s behalf was simply to allow MOVESA not to incur losses for 65,000 number plates that had already been bought and whose pre-shipment sample had failed.

“The Commission also found that MBS engaged in anti-competitive conduct in granting the waiver to MOVESA in that it did so simply because DRTSS requested it to do so without any other reasons and in spite of the fact that it had already communicated to MOVESA that they could not allow them to import a consignment into Malawi whose pre-shipment sample had failed as the Malawi Bureau of Standards Act did not allow them to allow importation of products that did not conform with mandatory standards.”

Thus CFTC found that the actions of MBS and DRTSS were in contravention of Section 32(1) of the CFTA and “also noted with concern that for many years, MOVESA had been the sole provider of number plate blanks in the country and it is only in recent times that another supplier was also engaged”.

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