17th July 2007
OPEN PLENARY SESSION (morning session)
To open this session, the Head of Commission on Investment, Technology & Related Financial Issues restated the objectives of this IGE.
The implementation of a generally accepted Competition Law and Policy is a key element for sustainable development and international trade. By this, States aim to contribute to the international fair trade order.
To eliminate restrictive business practices at all levels (national, regional & international). In countries of both hemispheres, especially in developing countries, various sectors are still under protection of agents and cartels. Developing international cooperation on this matter is vital.
To fight against these restrictive business practices, a possible solution is to impose sanctions and financial penalties when Competition Law and Policy are violated. A set of rules and recommendations on this matter have been established by UNCTAD, (see brochure). The purpose of these recommendations is to protect competition and consumers. Should this set of rules on Competition policy be amended or revised? Discussions are ongoing.
Main themes to be discussed during session: energy and law on intellectual property.
Important sub-themes: technical assistance provided by UNCTAD; mergers of companies and its impacts on international trade;
These sets of recommendations and guidelines are part of the soft law. By this, UNCTAD contributes positively in the international regulation and cooperation on market competition.
Election of officers for the 8th Session:
H.E. Mr. Mohammad Iqbal KPPU (Indonesia) as Chairman
Mr. Dmitri Fomchenko (Belarus) as Vice-Chairman-cum-Rapporteur
Agenda approved and adopted by all.
Informal discussions and general declarations by delegations:
Zambia: Technical assistance is the only program of UNCTAD in Zambia. Other measures and programs are needed to strengthen the presence of UNCTAD in Zambia and help economic development.
Focus on agreements made in Singapore is not sufficient. Besides commercial aspects, States should participate more in the writing of recommendations on competition policy of the European Union (refers to next meeting in Maurice).
Pakistan: a new national law on competition has been voted. The old one is already void, because it was too rigid and without sanctions. The new law is based on Rome Treaty and promulgation should be done soon. This reform is an important step for Pakistan.
However, the Pakistani delegate emphasized the importance of national organs’ independence. It is vital to create institutions and commissions which are completely independent, without any influence of governments.
Malawi: it’s been eight years that Malawi has a national law on competition, but there is still no implementation! The constitution of a permanent secretariat and commission on competition is necessary to control all the mergers and acquisitions of companies that are occurring in the country. Without such a body, Malawi does not have legal and efficient means to fight against restrictive business practices.
Zimbabwe: the implementation of a National Bureau against monopolies is an important evolution for the country. After eight years of activity, it still needs the support of UNCTAD, especially in the field of technical assistance and staff formations.
Czech Republic: proposes to impose sanctions on antitrust companies. The total value of these sanctions would represent the amount of investments in developing countries. However, one should consider that investments in those countries are low. Peru intervened: one should be assured that violating countries are not benefiting from these investments in developing countries. This is actually difficult to investigate. A control mechanism is necessary.
Russia: adopted two laws to protect competition. It has amended the regulations on sanctions on competition policy violations. On this matter, it has also several bilateral and multilateral agreements with developing and developed countries.
Morocco: seeks to develop a “culture on competition”.
Cameroun: In 1998, the law on competition was adopted, but put in place only in 2005! Lack of resources is the main reason for this. By the time, many sectors have been liberalized: energy, telecommunications, civil aviation etc.. The delegate insisted on the fact that Competition Law & Policy in the central African region is a new concept, and therefore, the help and monitoring of UNCTAD are absolutely necessary.
Botswana: is about to submit a project on Competition Policy to their Parliament. Implementation is due by 2009. Monitoring of UNCTAD is necessary.
Kenya: thanked UNCTAD for hosting many regional conferences and formations in Kenya these recent past years. The Parliament adopted a new law which is asking for the continuous cooperation of UNCTAD.
Costa-Rica: it has been the first country in the region to adopt a national law on competition in 1995. Technical assistance and staff formations by UNCTAD are very important in their region. A reform project of the competition policy is undergoing with the support of UNCTAD and Switzerland. The treaty on free-trade is also under preoccupations (regarding possible agreement with European Union).
AFTERNOON SESSION
Voluntary peer review: West African monetary union competition rules – Benin and Senegal
Session I
Introductory remarks by the Chairman of the peer review, Prof. Dr. Walter A. Stoffel (Swiss Competition Authority, Switzerland)
The Chairman welcomed this exam which is, according to him, really useful as it enables the authorities of a country to introduce their own system to others. Moreover, it is also a good mean to identify the weaknesses and the results obtained.
Then, a quick presentation of UEMOA was made and Walter Stoffel summarised the work they (the group of experts) did and the results they obtained.
One of the main points is that the group of experts recognized the presence of a good legal framework and also of good mechanisms. Indeed, they welcomed the considerable work which has been done these last four years by the UEOMA. Then, he gave some details about the functioning of the UEMOA. Thus, he underlined the applicability principle of the community standard, the primacy of the common law over the national one and the exclusive rights of the common law on the competition field (member states can’t take any decisions concerning the competition field). But if the legal framework and mechanisms are well in place, the results are still weak and the system must be strengthened. Thus, he presented some recommendations which have been elaborated by the group of experts to improve the plan of UEMOA: to develop a favourable environment for the competition, to improve the institutions, to adjust the proceedings. To conclude, he said that more than reforms, it’s rather concrete elements which should be inserted in the process of improvement of UEMOA.
The delegate of UEMOA qualified the report made by this precedent colleague, as for him the results are very noticeable even if institutional adjustments are still necessary.
Then the floor was given to the panellists.
The president of the French council for competition raised two main points. The first was that he wondered if a better association of the national actors couldn’t be established, and in a second time he wondered why no sanctions had been taken by the Council whereas it is necessary for such an institution to be credible.
The president of the Tunisian Council for the competition welcomed the efforts made by UEMOA and its members states, whereas the economic conditions weren’t always favourable. According to him, the results are positive even if some efforts have still to be done for a better articulation between the Commission and the national authorities.
The Indonesian Commissioner called for a strengthening of the Commission for the competition and for its total independence. Concerning the proceedings, in its opinion, they have to be elaborate at the national level.
Session II
Interactive session on specific issues identified in the Peer review report and issues on which the UEMOA, Benin and Senegal competition authorities might seek clarification and advice from participating competition authorities.
Senegal called for a better cooperation between the UNCTAD and the UEMOA. The Senegal delegate answered to some questions raised in writing by Italy and France. Concerning the liberalization, he stressed that reforms are difficult to implement in developing countries, but that the private sector is more and more increasing, specifically in the telecommunications field. Then he talked about the benchmarks of a national policy for competition. According to him they are: the promotion of the competition’s culture in the society, the improvement of the formation, legal frameworks and mechanisms of voluntary evaluation.
Benin underlined the fact they need the support of UNCTAD and of the international community because they don’t have the resources to achieve the reforms.
Then he gave the floor to the director of the competition in Benin which one notified that as his country didn’t have any legislation in the competition field before the common one, it didn’t meet any obstacles. But he found interesting to think about a share of the competences between the national authorities and the community ones. Concerning the GSM field, he specified that the increase of the operators in Benin didn’t lead nor to a collision nor to an accord. That’s why, in the absence of problem the UEMOA Council has not been seized.
Concerning the issue of the subsidiarity, the representative of UEMOA said that this institutional evolution will be raised in a next future. Concerning the conditions of the sanctions, he specified that up to today the injection principle had been preferred. But once the population and the actors will be enough sensitized, sanctions’ system will be implemented.
Italy said that UEMOA have to equip itself to a good system of repartition of competences. It should exist a space for the national law.
CEDEAO said that clear adjustments between the national law and the common one have to be established.
According to Morocco, the results of UEMOA and of Benin and Senegal are good, but he gave some elements to improve the system, such as strengthening the structure of UEMOA and organize the complementary between the common authorities and the national ones.
Salvador asked Benin and Senegal which kind of advice they could give to a country such as theirs.
The delegate of the USA deplored the exclusion of the states in the competition field law, affirming it is not a good thing.
CEMAC asked the UEMOA how they will force firms to pay the fines.
Brazil raised the issue of the share of the competences between the national authorities and the community ones.
Russia asked the UEMOA what have been the steps in the construction process of their structure.
Session III
To conclude the meeting, UEMOA said they will go into detail the issue of the subsidiarity, the sensitivity and the clarity of their texts. They also gave the website of the UEMOA in order to allow countries to understand and learn more about the rules of the UEMOA.
Then the floor was given to the president of the law court of UEMOA who said that for the moment they are still in the sensitivity process. He also strengthened that UEMOA will try to harmonize with CEDEAO, and that the convergence process will be reinforced. He also affirmed the possibility of a turnaround of the case law concerning the exclusivity competence of the community authorities in this field.
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