The Competition Commission of Mauritius ("CCM") has issued a communiqué on 9 April 2020 stating that it understands that:
- enterprises may have to collaborate during these uncertain times in order to ensure provision of essential products and services;
- certain prohibitions as contained under the Competition Act 2007 (the "Act") may create uncertainty as to what may be permissible in terms of collaboration in the context of the Coronavirus (COVID-19).
In light of the above, the communiqué states that, in its capacity as regulator and enforcer, the CCM will not limit or prevent necessary and critical cooperation, provided that these are in the interests of consumers and the public, and does not go longer or further than what is necessary in the current climate. It is our view that this derogation may apply only to those enterprises involved in the supply or purchase or essential goods and services.
The CCM has, at the same time, given a warning, presumably against enterprises having monopoly or near monopoly powers, that it will take action against conduct that:
- endangers public interest;
- harms consumer welfare; or
- seeks to exclude competitors.
The CCM has reminded suppliers that they are allowed to recommend prices to retailers by affixing labels on their packaging, as long as the words "recommended price" appear on the label.
According to the CCM, the Act also does not prevent suppliers from setting maximum prices for their products with a view to limit unjustified price increases at retail level.
In our view, the test that needs to be applied in the context of the Act is whether the impugned practice has the object or effect of preventing, distorting or restricting competition. In the context of a review of a monopoly situation, the CCM will also enquire whether the conduct being investigated in any way amounts to an abuse of monopoly situation. In assessing whether such abuse exists, the CCM must take into account, amongst other things:
- the ability of an enterprise to unilaterally change its price; and
- (the interests of consumers as a whole.
Under the Act, a monopoly is said to exist where 30% or more of goods or services are supplied, or acquired on the market, by one enterprise, or where 70% or more of those goods or services are supplied, or acquired on the market, by three or fewer enterprises.
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