Convincing Policy Makers and Garnering Greater Support for Competition Reforms CREW Project Inception Meeting March 2013 ITC Rajputana, Jaipur India Chilufya Sampa Zambia Competition & Consumer Protection Commission 1

2 PRESENTATION OUTLINE Competition & Consumer Protection Commission INTRODUCTION COMPETITION AND POLICY MAKERS MODES OF ENGAGING POLICY MAKERS OTHER STAKEHOLDERS AND THEIR ROLE CONCLUSION

INTRODUCTION Competition & Consumer Protection Commission COMPETITION IS A NEW CONCEPT IN ZAMBIA AND IN MOST DEVELPING COUNTRIES THE FORM OF ECONOMIC SYSTEM WAS SOCIALISTIC IN NATURE AND NOT MARKET DRIVEN GOVERNMENT INVOLVEMENT IN THE MARKET WAS HIGH 1991 BECOME APPARENT THAT ECONOMIC SYSTEM HAD TO CHANGE TO FREE MARKET 3

COMPETITION AND POLICY MAKERS Competition & Consumer Protection Commission THERE WAS NEED TO CHANGE THE STRUCTURE OF THE ECONOMY POLICY MAKERS HAD BEEN TRAINED IN DIFFERENT TYPE OF ECONOMIC SYSTEM - A CULTURE OF COMPETITION DID NOT EXIST EVEN THOUGH THE POLICIES WERE FREE MARKET ECONOMY – MIND SET OF THE POLICY MAKER WAS NOT - THERE WAS NEED TO CHANGE THE MIND SET CCPC FOUND ITSELF IN CONFLICT WITH POLICY MAKER E.G. ZAMTEL ON BOARD OF REGULATOR, PROCUREMENT TAILORED TO SPECIFIC PARTIES, PRICE FIXING IN BUS FARES SANCTIONED BY GOVT AGENCY PROHIBITIVE LICENSE FEES IN INTERNATIONAL GATEWAY RESTRICTIONS ON NUMBER OF PLAYERS IN CERTAIN MARKETS RESTRICTIONS OF PLAYERS BASED ON NATIONALITY 4

MODES OF ENGAGING POLICY MAKERS Competition & Consumer Protection Commission ADVOCACY PARLIAMENT – MAKE PRESENTATIONS TO PARLIAMENTARY COMMITTEES – SOMETIMES IT HAS NOTHING TO DO WITH COMPETITION NEVER THE LESS DO A GOOD JOB ANNUAL REPORTS – UP TO DATE AND PRESENTED TO PARLIAMENT WORKSHOP FOR PARLIAMENTARIANS – THEY WILL NOT ALL ATTEND BUT YOU SHALL CAPTURE A GOOD NUMBER IDEA IS TO RELATE TO THE PARLIAMENTARIANS PROBLEMS MONOPOLISTIC BUS FARES TO MONGU POSSIBLE CARTEL BEHAVIOUR IN INFRASTRUCTURE DEVELOPMENT IN CONSTITUENCIES PARLIAMENT RADIO – PROGRAMMES WITH PARLIAMENT RADIO COMMENTS ON TOPICAL ISSUES – ADVISORY OPINION ON TOPIC ISSUES TO VICE PRESIDENT EVERY MONDAY SHORTAGE OF MAIZE MEAL IN THE COUNTRY – CARTEL BEHAVIOUR – RESTRICTED PRODUCTION FUEL SHORTAGE – OBTAINED COURT WARRANT TO INSPECT FUEL FACILITIES AT OIL MARKETING COMPANIES AIM IS TO SHOW RELEVANCE OF COMPETITIOIN IN EVERY DAY ECONOMIC ACTIVITY 5

MODES OF ENGAGING POLICY MAKERS Competition & Consumer Protection Commission ENFORCEMENT TO SHOW THAT THE COMPETITION IS REAL THERE IS A NEED TO ENFORCE THE LAW ZAMBIAN BREWERIES V BETTERNOW FAMILY LIMITED (ABUSE CASE) USD 2000 MERCURY EXPRESS ( MERGER CASE FAILURE TO NOTIFY) USD 5000 CONTINENTAL MERGER WITH IMPACT (MERGER CASE REJECTED) CAR GARAGES ( CARTEL CASE ) ON APPEAL PUMA ENERGY /DANA HOLDING (MERGER CONDITION ABROGATION) USD 10 MILLION TAMBA CHICKS/HYBRID MERGER REJECTED 6

MODES OF ENGAGING POLICY MAKERS Competition & Consumer Protection Commission RELEVANCE TO NATIONAL AGENDA COME UP WITH A NATIONAL POLICY ON COMPETITION RECOGNISED THAT MANY GOVERNMENT MINISTRIES, DEPARTMENTS AND AGENCIES WERE NOT AWARE OF COMPETITION PRINCIPLES SHOW HOW COMPETITION CAN REDUCE POVERTY – PARTICIPATE IN NATIONAL AGENDA TO COMBAT POVERTY AND HAVE A CHAPTER ON COMPETITION E.G. SHOW HOW MUCH MONEY IS LOST THROUGH CARTELS IN FERTILISER … CCPC INTERVENTION HAS RESULTED IN GOVERNMENT TO BE MORE INCLUSIVE IN FERTILISER PROCUREMENT SHOW HOW COMPETITION CAN INCREASE JOBS OR CAN CREATE JOBS E.G. TAMBA CHICKS HYBRID MERGER TRANSACTION RESULTED IN AN AGGRESSIVE COMPETITIVE MARKET AND NOW HAS SIX COMPANIES FROM TWO MARKET STUDIES – CCPC MARKET STUDY IN SUGAR AND VITAMIN A FORTIFICATION – NTB HAS RESULTED IN ZAMBIAN CONSUMERS PAYING MORE FOR SUGAR THAN ELSEWHERE. ONE CAN GAIN POLITICAL MILAGE WITH SUCH INFORMATION 7

CONCLUSION Competition & Consumer Protection Commission IT IS NOT AN EASY TASK TO GARNER SUPPORT FOR COMPETITION REFORM YOU NEED TO SHOW THE RELEVANCE OF COMPETITION TO THE CRITICAL NATIONAL AGENDA SUGAR ISSUE – ACTION AID SAY ZAMBIA SUGAR IS ADVOIDING TAX, CCPC SAY IT’S A COMPETITION ISSUE – REMOVE THE NTB AND MARKET PRICES WILL COME DOWN YOU NEED TO SHOW THAT COMPETITION LAW CAN BE ENFORCED PUMA FINE IS A GOOD EXAMPLE YOU NEED TO SHOW JOB CREATION AND POVERTY REDUCTION DIFFICULT TO SHOW DIRECT BENEFITS IN MOST CASES BUT ALWAYS REFER TO YOUR INVOLVEMENT IN EACH TRANSACTION THE END 8