Competition Act facing overhaul

The Namibian Competition Commission (NaCC) CEO, Vitalis Ndalikokule talks to Observer Money about mergers, fulfilling its mandate and some of the challenges facing the Commission. He also discloses that the Draft Bill will overhaul the current Competition Act enacted in 2003.

OBSERVER MONEY (OM): We see that the NaCC is announcing the approvals of many mergers in the country. Apart from mergers, what else has the NaCC been doing?
VITALIS NDALIKOKULE (VN): Apart from the work done on mergers, the NaCC has also been carrying out investigations into anticompetitive practices in several sectors of the economy including the electricity, telecommunication, Poultry, hunting, conveyancing, pension fund administration, clothing retail, retail of agricultural products, fishing, aviation, motor vehicles, media, insurance and pharmaceuticals.

OM: Would you say that the NaCC is fulfilling its mandate to the fullest?
VN: The mandate of the NaCC is to safeguard and promote competition in the Namibian economy. While this is a broad mandate, we are confident that the NaCC is fulfilling its mandate. The market is generally aware that anticompetitive practices contravenes the Competition Act and that NaCC is there to enforce the Competition Act to ensure compliance.

OM: What are some of the challenges facing the operations of the NaCC at the moment?
VN: Limited financial resources is one of the challenges facing the operations of the NaCC. However, this challenge is not unique to the NaCC. It is a challenge that has been facing our country given the periods of economic recession, drought and COVID-19 pandemic which the country went through. There is light at the end of the tunnel as positive economic growth has been projected in 2023.

OM: What are some of the future plans of the NaCC in terms of expanding its mandate?
VN: The NaCC has been working on a Draft Competition Bill for some times now. The Draft Bill will overhaul the current Competition Act, 2 of 2003. The Draft Bill has been submitted to the Ministry of Industrialisation and Trade for it to go through a legislative process to be enacted into law. Once the Bill becomes law it will provide for the expansion of the mandate of the NaCC.
OM: What are some of the mergers that you are looking at currently?
VN: Currently, the NaCC is busy investigating nine mergers and five merger contraventions. However, this number increases everyday as new notifications are received. The complicated merges are in the Cement, Paint and Energy sectors. More mergers being notified is a good indication of active economic activities and compliance with the merger provisions of the Competition Act.

OM: How effective do you think the NaCC is in terms of fostering fair competition in the country?
VN: It is perhaps not fair for the NaCC to judge itself on the question of effectiveness as it would have been ideal to leave this to other people to judge the effectiveness of the NaCC. However, we think that the Namibian market feels the presence of the NaCC. This is why a significant number of mergers are being notified and determined by the NaCC as well as the number of investigations into anticompetitive practices being carried out. These points to the effectiveness of the NaCC in fostering fair competition in the country while recognising that there is always room for improvement.

OM: How does the NaCC rate compare to its peers in the region and what have you learnt from them?
VN: If one compares the NaCC to the rest of other Competition Authorities in the SADC Region, the NaCC could be ranked second in the region if one looks at its work and achievements over the years. The authority ranked first in terms of comparison could be the Competition Commission of South Africa. During 2022/2023 financial year for example, the Competition Commission of South Africa determined 297 mergers whist the NaCC determined 45 mergers. Other competition authorities in the region determined less than 45 mergers in 2022/2023 financial year. It is however, crucial to consider that the fact that economic conditions and competition regulation may be different across jurisdictions, which may have an influence on the number of mergers handled by each authority. Nevertheless, if one is to look just at the numbers, only South Africa has handled more mergers than Namibia, at the regional level. And this remains an accolade that the NaCC will strive to build on.
The NaCC learnt a great deal from our collaborative work on cross-border cartel investigations and cross-border merger investigations with both our peers from South Africa and Botswana competition authorities. We also learnt valuable lessons through the Cartel Working Group, the Merger Working Group and the Research Working Group of the SADC Competition Authorities to which Namibia is a member.

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