On the occasion of the Word Competition Day, observed on the 5th December each year, the Consumer Advocacy Platform urges Government to initiate consultations in view of the formulation of a Competition Policy.
The ultimate goal of competition and consumer policies, according to competition experts, is to enhance consumer well-being. The United Nations Guidelines for Consumer Protection establishes the link between competition and consumer protection.
In such a small economy as ours, where the market tends to be concentrated in the hands of a few family concerns capable of controlling several markets, and influencing policy-makers through political party funding, winning political and societal support remains a major challenge to the Competition Commission.
The Competition Commission’s decision to launch an investigation into a suspected abuse of monopoly, which goes back to more than 10 years ago, in the importation of petroleum products, the apparent casting aside of a complaint alleging anticompetitive practices by an e-commerce concern, during the pandemic, may lead consumers to doubt of the commission’s independence. CAP avers that the Competition Commission should not be perceived as the vindictive arm of Government.
On a different area, the fact that the Intellectual Property rights are exempted from the purview of the Competition Act, in spite of reports of anticompetitive practices under emergency procurement, is a cause for concern for consumers. More so, in the light of recent allegations pertaining to over invoicing practices by importers of pharmaceutical products leading to selling prices skyrocketing to 20 times the cost price. A technical committee set up to see how medicines could be excluded from IP constraints is yet to publish its recommendations.
CAP is also concerned that proposals for amendments to the Competition Act 2007 have not yet been circulated, nor have draft amendments been brought to Parliament.
It is an accepted fact that Competition law and competition policy can play an important role in the wider advancement of the country. By cracking down on exploitative or abusive market behaviour, competition law enforcement contributes to “economic democracy”, empowering consumers and the enhancing their wellbeing, while improving consumer choice and lowering consumer prices increase their economic power.
Thus it is no surprise that the Competition Authority has many powerful enemies. According to Shyam Khemani, formerly at the World Bank, firms use their wealth and market power to secure political influence, which they use to gain protection from the inconvenience of competition pressures, undermining the dynamism of the economy and the welfare of the country as a whole.
In such a restricted economy as Mauritius, market concentration in the hands of a few family concerns can undermine the law. Political party funding by the private sector can also be an obstacle to the implementation of competition law.
In addition to having to face the challenge of obtaining support from other governmental institutions, the Competition Commission also faces the challenge of winning societal support.
Competition and consumer protection policies should take into account the goals of eradicating poverty, satisfying the basic human needs of all members of society, and reducing inequality within countries. A recent inter-government expert meeting on competition reaffirmed that, when properly implemented, competition and consumer policy can contribute significantly to sustainable development.
In the light of the above, CAP calls upon the Competition Commission to initiate consultations with all stakeholders concerned in view of formulating of a comprehensive and effective competition policy which would be binding on parties concerned. These should include the ministry of Commerce and Consumer Protection, the ministry of Industry, Business Mauritius, the Chamber of Commerce and Industry, Medium and small importers, trade unions and consumer organisations.
A comprehensive Competition Policy is expected to provide policy guidelines to the Competition Commission as well as to different ministries and other sector regulators.