AEWG Panel BOS 4

CHALLENGES FACED AS A YOUNG COMPETITION

AUTHORITY

April 2015

Heinrich Mihe Gaomab IISecretary & CEO

Namibian Competition Commission (NaCC)

Presentation Outline

Background NaCC The Namibian Competition Act

Preliminary Provisions Chapter 3: Restrictive Business Practices Chapter 4: Mergers Offences and Penalties

Major Challenges Economic structure Provisions of the Act Lack of CLP Capacity constraint Availability of Data

Way Forward

BACKGROUND 1/3

NaCC The NaCC was established in terms of the

Competition Act 2 of 2003. Ensures enforcement of the Competition Act:

Investigate anti-competitive agreements and unilateral conducts

Assess and exemption applications Analyse and approve mergers notifications

Provide advocacy Conduct research and disseminate findings

to policy makers, businesses and general public

BACKGROUND 2/3

The Namibian Competition Act-(Based on EU competition law)

Preliminary Provisions: Enhance the promotion and safeguarding of

competition in Namibia Applies to all economic activities within Namibia

or having an effect in Namibia Chapter 3: Restrictive Business Practices

Part I: Restrictive Agreements, Practices and Decisions

Part II: Abuse of Dominance Part III: Exemption

Chapter 4: Mergers

BACKGROUND 3/3

The Namibian Competition Act cont... Offences and Penalties:

Hindering administration of the Act Failure to comply with summons Failure to comply with order of the Court Other offences:

Interference Providing false information Disclosing confidential information (Commission staff/memebers)

Penalties: Maximum of N$ 500,000 (USD42,000) or 10 year imprisonment

or both for failure to comply with order of the Court Maximum of N$ 50,000 (USD4,200) or 3 year imprisonment for

or both disclosing confidential information Maximum N$ 20,000 (USD1,700) or 1 year imprisonment or both

for any other offence as per the Act

MAJOR CHALLENGES 1/5

Economic Structure: Many state owned monopolies in the energy, transport,

mobile and fixed telecommunications sectors. Some are vertically integrated e.g.

Telecommunications sector Some sector regulators need to be capacitated to

effectively deal with ‘ex-ante’ regulations Some monopolies protected through Govt policies e.g.

Electricity generation-NaCC looking into this sector

MAJOR CHALLENGES 2/5

Provisions of the Act: No clear distinction between the treatment of

horizontal and vertical agreements No distinction between hardcore cartels and other

softer horizontal agreements. Mergers not empowered to summon for information

MAJOR CHALLENGES 3/5

Lack of CLP: The NaCC does not have in place a Corporate Leniency

Policy Have started with drafting of the CLP Experience delays at Attorney General office to legal

opinion With no CLP in place, it makes it difficult to detect

cartels So far only one cartel case has been investigated by

the NaCC

MAJOR CHALLENGES 4/5

Capacity Constraint: Competition relatively new in Namibia Competition Law courses only recently introduced in

high learning institutions Staff turnover within the NaCC due to better

opportunities outside Relatively new staff members especially in the RBP

Division with an average experience of 1 year and 6 months

MAJOR CHALLENGES 5/5

Availability of Data: Because of lack of summoning powers in merger cases,

availability of data is an issue Availability of data is a challenge in merger cases to

conduct economic tests such as the SSNIP Availability of data is also an issue to the NaCC’s

Economic and Sector Research Division

WAY FORWARD 1/2

As per the Act provides on regular intervals policy advise to Govt of Rep. of Namibia

The NaCC is at the final stages of review the Competition Act which will address challenges with regards to the provisions of the Act

The NaCC will develop a staff retention strategy

Enhance capacity building with special focus on in-house trainings

Develop a regularly updated information database

WAY FORWARD 2/2

Accelerate the development of the CLPImprove coordination with sector regulatorsNaCC will continue to develop and publish

various guidelines with regards to mergers and enforcement

Improve the NaCC’s organizational structure

THANK YOU