Who Guards the Competition Watchdog?

In his 2012 book ‘Enforcing Competition Rules in South Africa: Thieves at the Dinner Table’, former South African Competition Tribunal head David Lewis warns that a minister’s involvement in merger decisions weakened the independence of the country’s competition authorities.

“Their decision-making powers and their independence has been attacked in the most destructive manner,” he says in an extract published by Mail & Guardian.

That sounds familiar in Namibia, where the competition commission appears to be operating at the mercy of its line minister.

The commission is a key statutory body that exists to stop a handful of companies from fixing prices or buying out their rivals to dominate markets.

This week, the High Court of Namibia rejected industries minister Modestus Amutse’s approval of the merger of Namibia’s two cement producers.

He admitted in an affidavit that objections to the transaction never reached him, saying he weighed the benefits of the sale against job losses from the closure of two cement companies.

Amutse had overruled the Namibian Competition Commission’s disapproval of the same deal.

He had also overturned the commission’s ban on Nasan Energies buying fuel from Vitol.

The minister was asked in parliament this week whether he should personally be personally held liable for costs after the High Court cement case. That question misses a systemic flaw in the current competition commission law that allows a minister to override an independent institution.

The elephant in the room is Section 49 of the Competition Act, which allows parties to ask the minister to review a commission decision, and the minister has the final say before a party can approach a court.

Essentially, the authority given to the minister makes arbitrary rulings easy for one person.

In any case, we’ve already seen how the commission appears to have been politicised by well-connected mining business people who appear to target conservancies that have over the years pushed back against mining operations near the communities.

One of the answers to the potential abuse of power is enhanced oversight instead of one individual performing this role.

Six years ago, the competition commission requested written submissions on the Namibian competition draft bill, which sought to introduce sweeping changes, including improving the competition authority’s structure and powers.

It includes the establishment of a competition adjudicative panel, an independent structure appointed by the president, to adopt the roles currently played by the High Court in respect of prohibited practice matters and the minister in respect of mergers.

However, that bill is still being discussed.

If the Namibian competition draft bill is an important piece of proposed legislation that will modernise the institution, why, after six years, has it not been finalised? Are there perhaps people who want the institution to remain toothless so they continue undermining its mandate?

We hope that our leaders appreciate that a competent competition authority plays a central role in the economy. It’s high time that the Namibian competition draft bill is brought back to ensure the commission gets the support and independence it deserves.

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