The 5th Annual African Consumer Protection Dialogue Conference

1. The 5th Annual African Consumer Protection Dialogue Conference Consumer Protection and Competition Issues – An Overview Competition and Fair Trading Commission, Malawi Livingstone, Zambia 10-12 September 2013

2. Presentation Outline • Legal Framework for Competition and Consumer Protection in Malawi • Competition and Fair Trading Act, 1998 • Consumer Protection Act, 2004 • Consumer Protection Issues in Malawi • Competition Issues in Malawi

3. Legal Framework for Competition and Consumer Protection in Malawi Malawi Government passed the Competition and Fair Trading Act in 1998. The Act came into force on 1st April 2000. The Act seeks to: • encourage competition in the economy by prohibiting anti-competitive trade practices; • establish the Competition and Fair Trading Commission; • regulate and monitor monopolies and concentrations of economic power; • protect consumer welfare; • strengthen the efficiency of production and distribution of good and services; • secure the best possible conditions for the freedom of trade;

4. Legal Framework (cont……) In addition, the Government also passed the Consumer Protection Act in 2004 with a view to ensure the following: • Protect the rights of consumers; • Address the interests and needs of consumers; • Establish a Consumer Protection Council; and • Provide effective redress mechanisms for consumer claims and related issues Note: The Consumer Protection Council is yet to be constituted and in its absence, the CFTC is the regulator for protection of consumers against creation of unfair trading conditions

5. Consumer Protection and Competition Issues • Presented below are the highlights of some of the consumer protection and competition issues based on cases handled by CFTC: • Alleged Anti-Competitive Business Practices • E.g. The Commission considered a report on investigations into alleged anti-competitive practice by Illovo Sugar (Malawi) Ltd and its appointed Warehouse Administrator for Karonga: Simama General Dealers where it was alleged that the former granted the latter a monopoly in the distribution of sugar in the neighbouring districts. • This resulted in smallscale sugar wholesalers to buy sugar at a price higher than the ex-factory price • Finally resulted in eventual higher prices to final consumers

6. Consumer Protection and Competition Issues…………… • Applications for acquisitions • E.g. Toyota Tsusho Corporation (TTC) and CFAO (France) had submitted an application for authorisation of the acquisition of at least 41.99% control shareholding in CFAO by TCC. • The Commission granted authorisation to the application subject to receipt from the Parties of formally executed undertakings aimed to address the competition concerns that may arise in the sector post merger.

7. Current Consumer Protection and Competition Issues………… • Applications for mergers • The Commission considered a report of the investigation into an application for authorisation of acquisition of shares in Indefund Limited by Indebank Limited. • The Commission authorised the merger upon establishing that the transaction would not likely lessen competition in the micro finance market neither would it raise an competition concerned in the banking sector.

8. Consumer Protection and Competition Issues….. • Alleged anti-competitive practice by Airtel Malawi Ltd in the distribution of airtime and related services • This case was brought to the Commission by SF Telecomms which alleged that Airtel Malawi Limited was implementing Distribution Agreements against provisions of the Competition and Fair Trading Act which, among other things, restrain companies from implementing agreements that impose restrictions on where or to whom goods may be sold. • The Commission ordered Airtel Malawi Limited to cease and desist from implementing the Distribution Agreements without the authority of the Commission.

9. Consumer Protection and Competition Issues…. • Consumer Awareness Campaign • As part of information dissemination to consumers and the general public the Commission participated in the Malawi International Trade Fair held in May 2013. • The Commission produced information brochures and leaflets for consumers (in Chichewa and English) • The materials are being distributed to consumers as part of the Commission’s awareness campaign. • Copies of the Competition and Fair Trading Act were also reproduced and are also being distributed to consumers as part of creating awareness to the general public

10. Consumer Protection and Competition Issues…….. • Working relationship with relevant stakeholders • CFTC recognizes the importance of working with other relevant stakeholders in addressing issues of competition and consumer protection in different sectors of the economy • To this effect CFTC signed an MOU with Malawi Communications Regulatory Authority (MACRA) which regulates the communications sector • The MOU enables CFTC and MACRA to effectively address any matters relating to anti-competitive behaviour and unfair trading practices in the communication sector

11. THANK YOU!