Establishment of a Competition Commission of Ghana necessary – Baker McKenzie
The creation of a Competition Commission of Ghana per the 2021 Overview of Competition & Antitrust Regulations and Developments in Africa report by multinational law firm, Baker McKenzie, has become necessary due to the absence of of an overarching competition legislation or regime in Ghana.
The law firm in its report indicates that unlike some of its peers on Continent – Nigeria, Kenya and Malawi – which have central competition authorities that monitor and regulate competition in their markets, competition in the various sectors of the Ghana’s economy are regulated by industry-specific regulators/regulatory bodies that serve as competition authorities to promote competition and prevent anti-competitive behaviour.
Baker McKenzie is of the view that formation of the Commission and enforcement of Competition Law will help ensure effective market participation, consumer protection and fair business practices in the country especially amid the Covid-19 pandemic as businesses sought to undermine competition, while exploiting the global crisis brought about by the pandemic.
“With the growth of economies across the continent, competition law has remained one of the key drivers for effective market participation, consumer protection and fair business practices. The global pandemic introduced new challenges for competition authorities in Africa and abroad, with each enforcer pursuing the most beneficial enforcement method for its national or regional jurisdiction.
“These efforts were aimed at curbing the persistence of unjustified price hikes, anticompetitive cooperation between competitors and other harmful business practices that sought to undermine competition, while exploiting the global crisis brought about by COVID-19,” noted the report.
Despite the absence of an overarching competition legislation or regime in Ghana, there are however, some laws in place that criminalises anti-competitive conduct by businesses in the country.
One such known law is the Protection Against Unfair Competition Act, 2000. The Act criminalises behavior that is likely to cause confusion and be misleading in terms of others’ business goodwill, reputation, and proprietary information.
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Another, is the National Petroleum Authority Act, 2005 which criminalises the formation of cartels, monopolies, and unfair competition in the petroleum industry, as well as cartelisation in the petroleum downstream industry.
Cartelisation refers to an agreement, combination of or concerted action by refiners, importers or dealers or their agents, to fix prices, restrict output, divide markets either by allocating products or areas to restrain trade or free competition. The penalty for forming a cartel or a monopoly is imprisonment for a minimum of 10 years, or a minimum fine of GHS 60,000 (approximately USD 10,378.97), or both. The minimum fine in the case of cartelisation is GHS 180,000 (approximately USD 31,136.92).
The establishment of a Competition Commission of Ghana is expected to happen in the short to medium term due to the fact that a Competition Bill draft has been tabled before parliament but is yet to be passed.
The principal objective of the draft bill when passed, is to maintain and encourage competition in markets, to promote and ensure fair and free competition, and to protect the welfare and interests of Ghanaian consumers.
The Competition Commission of Ghana when established will be mandated to monitor trading practices in the country to ensure fair trade practices and of preventing restrictive trade practices in the country.
