ZAMBIA: COMPETITION AND CONSUMER PROTECTION COMMISSION FINES SEVEN COMPANIES FOR CARTEL CONDUCT
The board of the Competition and Consumer Protection Commission (Commission) has made a finding against seven suppliers of fish fingerlings in Zambia, for engaging in cartel conduct.
The Commission issued fines to six companies, amounting to 9% of their respective annual turnovers, and fined a seventh company 10% of its annual turnover, being the maximum penalty, the Commission is able to levy for competition law contraventions.
The Commission initiated its investigation in April 2020, following a public notice issued by the companies informing of an impending uniform price increase. The Commission’s investigation revealed that there was no justification for the accused companies, all of which are competitor producers and distributors of fish fingerlings, to have a common pricing policy, particularly in light of the varying production and distribution costs each company is exposed to. The Commission has not indicated, at least publicly, whether the individuals involved would also be subject to criminal prosecution as provided for in the Competition and Consumer Protection Act, 2010.
The Commission has repetitively warned businesses against engaging in collusive conduct, and put in place several measures to clamp down on cartel activity, including offering to discount administrative penalties payable by contravening firms. In 2019, the Commission implemented a temporary amnesty programme in which it called upon persons/enterprises engaged in or having knowledge of anti-competitive behaviour, to come forward and disclose such behaviour, in exchange for immunity from possible civil and criminal prosecution.
The amnesty programme ended in February 2020. Regrettably, the Commission advised that the programme yielded zero results, with no market players coming forward. Following this, the Commission remarked: “Let the cartel members out there know that it’s a matter of time before their conduct in uncovered. In 2019 alone, the Commission uncovered 55 suspected cartel cases and once investigations are concluded, the Commission will send a strong signal by prosecuting both the companies involved and their directors in their individual capacities”.