Competition and Consumer Protection (Amendment) Act, 2023

The COMESA Competition Regulations in the Third Schedule apply to certain economic activity affecting the Republic and at least two COMESA Member States, and the enterprise must not engage in conduct that contravenes Part VII of the Act.

This provision amends section 5 of the principal Act by adding wording about “market power,” inserting a new paragraph on reviewing relocation applications for core assets, and renumbering a later paragraph.

This provision says the principal Act is amended by inserting a new section immediately after section 5.

The Board must carry out the Commission’s functions and strategic direction, and it may delegate functions to the Executive Director in writing and on stated terms.

The amendment adds a rule allowing goods sold or offered in violation of the Act to be seized and kept as evidence.

This section amends the principal Act by repealing section 8 and replacing it with new text.

Enterprises, groups of enterprises, and trade associations must not make anti-competitive agreements or engage in concerted practices that substantially restrict competition in the relevant market.

This section amends Section 14(1) of the principal Act by replacing “thirty” with “fifteen” in paragraph (a) and “fifteen” with “thirty” in paragraph (b).

Section 17 of the principal Act is repealed and replaced with a new section titled “Determination of relevant market.”

The Minister may, with the Commission’s advice, prescribe how the relevant market is determined for meeting share of supply or acquisition thresholds under the Act.

This section adds new rules about relocating core assets without authorisation and about applying for authorisation to relocate them.

An enterprise must not move core assets from the Republic to another State unless the Commission approves it.

An enterprise planning to move core assets out of the Republic must apply to the Commission for authorisation and pay a prescribed fee.

The Commission must issue guidelines for determining market presence or market turnover when establishing control of assets.

This section amends the principal Act by inserting a new section after section 34.

An enterprise must give the Commission correct information for assessing a proposed merger and follow merger conditions or undertakings tied to an approved merger.

This provision repeals section 35 of the principal Act and replaces it with new text.

The Commission may revoke an approved merger if an enterprise fails to comply with section 34A.

This section amends the principal Act by repealing section 37 and replacing it with new content on offences relating to mergers.

An enterprise commits an offence if it implements a merger without the Commission’s approval or after the Commission rejects it.

Section 42 is amended by replacing “Part III” with “this Act”.

The principal Act is amended by adding “and consumer protection” after “competition” in section 43, and section 45 is repealed and replaced.

This section amends the principal Act by repealing section 45 and replacing it with new text.

A trading practice is unfair if it misleads consumers, falls below reasonable standards of honesty and good faith, is unconscionable, or pressures consumers through harassment or coercion.

If a person or enterprise breaches subsection (1), they must pay a penalty, and may also have to refund the consumer, replace the goods, or perform the service to a reasonable standard.

This section repeals section 47 of the principal Act and replaces it with new text.

A person or enterprise must not make false or misleading claims about goods or services, and the Commission can order refunds, replacement, or service performance plus penalties.

Section 48 is amended to include “or platform” after “premises”, and contraventions of subsection (1) attract a penalty.

A person or enterprise that contravenes subsection (1) commits an offence and may face a penalty; after providing the service, it must also refund the consumer or perform the service to a reasonable standard within 14 days.

This section amends Section 50 of the principal Act by changing the label wording and substituting the agency name.

This provision repeals section 51 of the principal Act and replaces it with new text.

Businesses and individuals must not charge more than the displayed price, must use the lowest displayed price if multiple prices are shown, and must display prices in the Republic’s legal tender subject to the Bank of Zambia Act, 2022.

A person or enterprise must not sell goods to consumers unless they meet approved standards, and must not sell, supply, import, or display expired products. The Commission may impose a penalty up to 10% of annual turnover.

Section 55 is amended to set penalties for contravening subsection (4) and to add “review” after “investigate” in subsection (11).

This provision replaces part of section 57. It requires the Commission to send a consent agreement to the Tribunal for confirmation, lets the Tribunal confirm it or send it back with concerns, and says an enterprise undertaking must be communicated in writing as a Board decision and has the same effect as a Board directive.

This provision repeals section 58 of the principal Act and replaces it with new wording.

The Commission may direct an enterprise to stop anti-competitive conduct or an unfair trading practice, and may impose a financial penalty.

This section amends Section 59(1) of the principal Act by deleting the words “after review” after the word “determines”.

A Tribunal mandatory order may be served, executed, and enforced as if it were an order of the High Court.

A foreign competition or consumer protection authority may ask the Commission to investigate and make a determination if it has reasonable grounds to believe an anti-competitive or unfair trading practice in the Republic is harming competition or consumer welfare in its own country, and subsection (2) must be followed.

A member whose appointment ends must keep holding office until a successor is appointed, but only for up to three months.

This section repeals section 75 of the principal Act and substitutes new wording.

An aggrieved person or enterprise may appeal Tribunal decisions to the Court of Appeal within 30 days.

This section amends the principal Act by inserting the Third Schedule in the Appendix.

This section amends the principal Act by replacing the words “to pay the Commission a fine” with “to pay the Commission a penalty” wherever they appear.

This section is titled “Obligations of Member States” and appears under institutional arrangements.

This section is about the composition of the Board of Commissioners.

This section is titled “Functions of the Board” in Part 3 on anti-competitive business practices and conduct.

This section is about determining when a position is dominant.

Section title: Determination of Anti-Competitive Conduct: Procedure of Commission on Request.

This section concerns the Commission’s procedure for determining anti-competitive conduct on its own initiative.

This section is titled “Notification of a Proposed Merger.”

Section heading: “Consideration of a Merger” in Part 5 (Consumer Protection).

Section 28 is titled “Unconscionable Conduct in Consumer Transactions.”

Section 29 is titled “Unconscionable Conduct in Business Transactions.”

Product safety standards and unsafe goods.

The Commission has power to declare product safety or information standards.

This provision is titled “Liability in Respect of Unsuitable Goods.”

Section 36 is titled “Liability for Defective Goods Causing Injury or Loss.”

This section defines key terms used in the Regulations, including anti-competitive conduct, consumer, goods, services, trade, undertaking, and the COMESA institutions.

These Regulations aim to promote competition, protect consumers, and discourage restrictive market practices.

These Regulations apply to all economic activities in or affecting the Common Market, except activities listed in Article 4.

These Regulations apply to conduct covered by Parts 3, 4 and 5 if it has an appreciable effect on trade between Member States and restricts competition in the Common Market.

These Regulations take primary jurisdiction over an industry or sector when a separate regulatory entity regulates conduct covered by Parts 3 and 4, except for conduct expressly exempted by national legislation.

These Regulations do not apply to certain collective bargaining, trade union, association, and professional association activities.

The Regulations do not take away intellectual property rights and protections, but they still apply where that property is used in an anti-competitive way.

Member States must take appropriate measures, help achieve the Common Market’s objectives, and avoid measures that could undermine those objectives.

This provision establishes the COMESA Competition Commission and says it has international legal personality.

The Commission has legal capacity in each Member State and may acquire or dispose of movable and immovable property, subject to the laws and regulations in force there.

The Commission must apply these Regulations to trade between Member States and promote competition within the Common Market.

The Commission has powers to monitor and investigate anti-competitive conduct, help Member States, cooperate with authorities, and share competition and consumer-protection information.

The Commission may monitor, investigate, make determinations, and take action to prevent, inhibit, or penalise undertakings in relation to trade between Member States.

The Commission may, when investigating, order people to appear and give evidence, require documents to be produced, and take other reasonable actions needed for the investigation.

The Commission may determine that there has been a breach of the Regulations if the conduct has, or is likely to have, an appreciable negative competitive impact and is inconsistent with the objectives of the Common Market.

The Commission may order anti-competitive agreements or conduct to stop, require corrective steps, pay compensation to affected persons, and impose fines.

If any person breaches these Regulations, related Rules, a lawful directive or order, or a lawful requirement, and no separate penalty applies, the breach is deemed a breach of the Regulations and the person may be fined and/or given another penalty set by Rules.

The Commission may enter into arrangements for goods and services when needed to efficiently perform its functions.

The Commission may make its own rules of procedure to help implement the Regulations, subject to Article 55 of the Treaty.

The Commission may appoint additional staff.

The Council must appoint a citizen of a Member State as Director of the Commission.

The Director must administer the Commission’s affairs, funds, and property, and must carry out any other functions given or assigned under the Regulations or by the Commission.

Commissioners cannot be appointed as the Director.

The Director must have suitable qualifications and experience in law, economics, commerce, industry, or public administration.

The Board of Commissioners sets the Director’s appointment terms and conditions, but only with the Council’s approval.

The Director serves for five years and can be re-appointed for only one additional five-year term.

The Director cannot be removed from office except by the Council, and only for stated misbehavior, inability to perform the office because of infirmity of mind or body, or as allowed by law.

The Director may resign by giving three months’ written notice to the Council.

The Council may remove the Director from office if the Director becomes disqualified under Article 14.

The Director may appoint Deputy Directors, a Registrar, and other officers, but only with Board approval.

This provision establishes the Board of Commissioners and states that it is the Commission’s supreme policy body.

The Board must have between 9 and 13 Commissioners, appointed by the Council on the Secretary-General’s recommendation.

The Board must elect the Chairperson and Vice-Chairperson from among its members.

People recommended for appointment as a Commissioner must be selected for their ability and experience, and only citizens of a Member State may be recommended.

The Chairperson must appoint three Commissioners as full-time Board members, and Board members must not take part in the Commission’s day-to-day administration.

Commissioners must hold office for an initial term of three to five years, and no Commissioner may serve more than two terms.

A Commissioner’s office becomes vacant if the Commissioner dies or meets any of the listed disqualifying conditions.

The Board may issue determinations, hear appeals, review decisions, make orders, and delegate functions under these Regulations.

The Board may recommend Rules to the Council on prescribed matters, forms, fees, and other matters needed to carry out the Regulations.

Certain agreements, decisions, and concerted practices are prohibited if they may affect trade between Member States and restrict competition in the Common Market.

Paragraph 1 applies only when the agreement, decision, or concerted practice is, or is intended to be, implemented within the Common Market.

Any agreement or decision prohibited by paragraph 1 is void.

Paragraph 1 may be declared inapplicable for certain agreements, decisions, or concerted practices if they improve production or distribution, promote technical or economic progress, give consumers a fair share of the benefit, and do not impose unnecessary restrictions or eliminate competition in a substantial market.

The provision defines a dominant position and says abuse of that position by undertakings in the Common Market is prohibited if it may affect trade between Member States.

Undertakings in rival or potentially rival market activities must not engage in the practices listed in paragraph 3, unless they are dealing within a common entity under common control or otherwise cannot act independently.

This Article applies to formal, informal, written, and unwritten agreements, arrangements, and understandings.

The provision prohibits certain anti-competitive agreements and collective practices, including price fixing, bid-rigging, market allocation, quota allocation, collective refusals to supply or buy, and denial of access to key arrangements.

The Commission may grant an authorisation allowing an undertaking to enter into or carry out anti-competitive contracts, arrangements, or understandings if public benefits outweigh the anti-competitive harm.

An applicant making an application to the Commission for authorisation about a contract or proposed contract must include the parties’ names.

An authorisation for a proposed contract may be treated as subject to a condition requiring any party to the contract, if the Commission asks, to give the Commission the names of all contract parties.

An affected undertaking or other person with a substantial financial interest may appeal a Commission decision to the Board under the Rules and Regulations.

Any person may ask for an investigation under Article 8 if they reasonably believe an undertaking in a Member State is restricting competition in the Common Market.

A consumer organisation may request an investigation if it has reason to believe a Common Market undertaking’s activities restrict competition or are likely to do so.

Requests under paragraphs 1 and 2 must be in writing and give enough information for the Commission to make a preliminary assessment on whether to investigate.

After receiving the request, the Commission must consult the interested parties and decide whether the investigation is within its jurisdiction and justified.

Consultations must finish within 30 days of receiving the investigation request, unless the Commission notifies parties that a longer period is needed.

If the Commission decides to investigate, it must notify the interested parties, finish the investigation within 180 days of receiving the request, and may extend the time if circumstances warrant, with notice to the interested parties.

If the Commission decides after an investigation that the Regulations were breached, it must notify the respondent and let that party defend its interests.

If a hearing has been convened and the respondent party has used the chance to be heard, the Commission must notify interested parties of its decision on the breach and sanctions within 30 days of that hearing.

The Commission must notify the interested parties of its determination within 10 days of the hearing, and it may decide consequences for the party in breach.

The affected party may appeal the Commission’s determination within 15 days of notification, following the Regulations.

The undertaking concerned must do as directed within 30 days after notification, unless the Commission decides otherwise.

If the undertaking concerned cannot comply, it must notify the Commission and request an extension.

If an undertaking cannot comply within the specified time and does not inform the Commission, the Commission may ask the relevant national court for an appropriate order.

If the Commission believes an undertaking’s business conduct restrains competition in the Common Market, it must notify the undertaking and launch an investigation.

The Commission must complete its investigation within 180 days after the notification in paragraph 1, unless it decides a longer period is necessary.

At the end of the investigation, the Commission must notify the undertaking of its findings.

The undertaking may respond to the Commission within 20 days after the notification in paragraph 3.

If the undertaking does not respond in time, the Commission may assess sanctions.

This section defines “merger” for this Article as acquiring or establishing a controlling interest in all or part of a competitor’s, supplier’s, customer’s, or other person’s business, including by shares/assets purchase or lease, amalgamation, combination, or other means.

This provision defines “controlling interest” for undertakings and assets.

This Article applies only when the firms meet the cross-border Member State condition and the combined annual turnover or asset threshold in paragraph 4 is exceeded.

The Board may prescribe a regional merger-applicability threshold and a method for calculating annual turnover and assets, but only with Council approval.

This provision defines “notifiable merger” and “non-notifiable merger” for this Article.

The Commission may require notification of a non-notifiable merger if it thinks the merger may reduce competition substantially or be against the public interest.

A party to a notifiable merger must notify the Commission in writing about the proposed merger as soon as practicable, and no later than 30 days after the parties decide to merge.

A notifiable merger done in breach of this part has no legal effect, and merger-related rights or obligations in any agreement are not legally enforceable in the Common Market.

A notification under paragraph 1 must be made in the prescribed form and manner and include the prescribed fee and required information.

The Commission may impose a penalty if merger parties fail to give the required merger notice.

A penalty under paragraph 3 cannot be more than 10% of either or both merging parties’ annual turnover in the Common Market for the preceding financial year.

When setting a penalty, the Commission must take the listed factors into account.

The Commission may bring civil proceedings to recover any penalty imposed under paragraph (3) from the party or parties concerned.

A Member State may ask the Commission to refer a merger for review under national competition law if it knows about the merger notification and believes the merger would materially and disproportionately reduce competition in the Member State.

The Commission must consider a request and tell the concerned Member State in writing within 21 days whether it will handle the case itself or refer it to the Member State’s competent authorities.

The Commission must examine a merger when notification is received and decide on the notification within 120 days.

The Commission must assess a merger’s impact on competition, and if it may substantially lessen competition, consider efficiency and public-interest justifications. If it needs more time, it must notify the parties and seek an extension from the Board before the 120-day period expires.

When assessing whether a merger will substantially lessen competition, the listed market factors must be considered.

A merger is contrary to public interest if the Commission is satisfied that it substantially lessens competition or creates/strengthens dominance contrary to the public interest.

When deciding whether a merger is contrary to the public interest, the Commission must consider all relevant matters and especially the effects on competition, consumers, costs, innovation, and entry of new competitors.

When deciding whether to approve a merger, the Commission may, if necessary, carry out an inquiry to find out whether there are competition concerns.

Before starting an inquiry under this Article, the Commission must take reasonable steps to notify the relevant Member States, and the notice must describe the proposed inquiry and invite interested persons to submit written representations.

If the Commission finds a merger contrary to the public interest, it may issue orders to stop, limit, unwind, or otherwise address the merger.

An order made for a merger may deal with property, contracts, shares or securities, and the formation or winding up of an undertaking.

Orders must be in writing. If individual service is impractical or the order applies generally, the Commission must take reasonable steps to inform the concerned Member States.

Before making an order under this Article, the Commission must inform affected persons of the order’s general content and give them a chance to make representations; in some cases it must publish the general content instead.

The Commission may amend or revoke an order at any time.

A person aggrieved by a Commission decision may appeal to the Board of Commissioners, subject to the Regulations.

A person must not make false or misleading claims in trade or commerce about goods or services.

A person must not engage in unconscionable conduct in trade or commerce when supplying, or possibly supplying, goods or services to someone.

The Commission may consider listed factors when deciding whether a person engaged in unconscionable conduct, and a person is not treated as unconscionable just because they sue or send a dispute to arbitration.

When deciding whether paragraph 1 was contravened for supply or possible supply of goods or services, the Commission must ignore unforeseeable circumstances and may consider conduct or circumstances before these Regulations commenced.

This paragraph says that “goods or services” means goods or services usually bought for personal, domestic, or household use or consumption.

This paragraph says that a reference to the supply or possible supply of goods does not include goods supplied for re-supply, or for use up or transformation in trade or commerce.

A person must not engage in unconscionable conduct in trade or commerce connected with supplying or acquiring goods or services.

The Commission may consider several listed factors when deciding whether a supplier contravened paragraph 1 in relation to supplying goods or services to a business consumer.

The Commission must publish a notice in the Member States concerned about specified goods under investigation or possible risks in their use.

After the investigation is completed, the Commission must announce the results and say whether any action is proposed for the goods.

A person must not supply consumer goods that fail safety requirements, are declared unsafe, or are permanently banned. A person must not export goods that cannot be supplied in the Common Market unless the Commission has approved the export in writing.

If the Commission denies approval under paragraph (2), the affected party may appeal to the Board.

If the stated conditions are met, the person is treated as having suffered the loss or damage caused by supplying the goods.

If goods are supplied in breach of a notice declaring them unsafe or permanently banned, and someone suffers loss or damage linked to the goods or missing information about them, the person is treated as having suffered that loss or damage by the supply.

A person must not supply certain consumer goods in trade or commerce unless the relevant consumer product information standard has been complied with.

The regulations may prescribe a consumer product information standard for certain goods.

Paragraph (1) does not apply to goods intended to be used outside the Common Market.

A statement on goods can count as applied to the goods if it is attached or incorporated in specified ways.

This provision expands the meaning of “covering” and “label” for paragraph (5).

A person is treated as having suffered loss or damage from supplying goods if the goods were supplied without complying with the prescribed consumer product information standard and the missing information caused the loss.

This provision sets out when a supplier’s goods may be subject to compulsory product recall.

The Commission may require a supplier, by notice, to recall goods or make specified disclosures or public statements within the stated period.

Before the Commission publishes the notice, the Director must notify the affected party and give them a chance to be heard. The Director must then tell the party the Commission’s decision within 10 days of the hearing.

The Commission must notify the public in the Member States concerned that certain specified standards are consumer product safety standards.

If a notice has been given, the referenced standard (or part of it), including any specified additions or variations, is treated as a prescribed consumer product safety standard for Articles 31 and 32.

A supplier may be liable to compensate a consumer if goods sold for a known purpose are not reasonably fit for that purpose and loss or damage results.

Paragraph 1 does not apply in certain cases, including where the goods became unfit after leaving the Person’s control for specified reasons, or where the consumer did not rely on the Person’s skill or it was unreasonable to do so.

A person who supplies defective manufactured goods in trade or commerce is liable to compensate an injured person for the loss caused, and the injured person may sue to recover that amount.

The text sets out conditions relating to an action for damages under COMESA or a Member State law, where the defect is the person’s wrongful act, neglect, or default.

A person who wants to bring a liability action may ask known suppliers in writing for details identifying who made the goods.

If a person was asked for something and did not comply, they are treated as having manufactured the action goods for the action.

In a liability action, certain listed facts can be used as a defence. The Board may make Rules, but they only take effect after Council approval.