By JAMES ANYANZWA

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The East African Community (EAC) targets to have common rules regulating competition between companies and protecting the market from infringements by the end of next year.

This emerged from a memorandum of understanding (MoU) signed on Tuesday in Naivasha between the regional bloc and Kenya’s watchdog, the Competition Authority of Kenya (CAK).

And officials said the deal would bring together watchdogs from EAC partner states to draft common rules on mergers, acquisitions and other company dealings that may often infringe on fair competition.

Read: Comesa watchdog urges vigilance in mergers

“By the end of December 2024, the two agencies have committed to, among others, review and streamline merger notification guidelines, development and implementation of information sharing framework for cross-border laws,” Adan Wario, the CAK acting Director-General told The EastAfrican in Naivasha on Tuesday.

“This model will also be informed by the applicable notification system in the Common Market,” said Dr Wario after the signing ceremony.

The MoU says watchdogs who want to buy into common rules will be at liberty to submit observations and cooperate with peers and the EAC in implementing the regulatory framework supportive of investments “while purposely extinguishing harmful anti-competitive conduct.”

Research uniformity

The EAC has had two key pillars to foster trade: the Customs Union and the Common Markets. But the bloc says competition regulation is crucial if the region is to cultivate common trends within its jurisdiction.

Lilian Mukoronia, the EAC Competition Authority Registrar, said a common framework would aid countries in implementing the pillars of the bloc.

“The aim of the [MoU] is to ensure we carry out investigation and research in uniformity while ensuring competitiveness among the member states,” she pointed out.

She said among other significant highlights was the removal of trade barriers, providing partner states’ consumers with competitively priced good quality products, and protecting market participants from anti-competitive practices.

She said the regional agency would enforce competition policy and law while admitting there were cases of “unfair” competition that were still very active.

Read: EA competition watchdog begins operations, market studies ongoing

Competition watch will, however, go beyond transactions between firms. It will look into pricing, quality of products and events that could generally give one side an undue advantage.

“Further, the agreement facilitates information sharing, particularly during joint investigations, market inquiries and studies, which shall be prioritised so as to safeguard the competition process and protect consumers in the region while respecting our respective laws and policies,” noted Dr Wario.

This information largely includes turnover, shareholding, geographical location, market share and business activities aimed at curbing unfair competition.

Collaborations

The EAC Competition Authority (EACCA) and CAK seek to implement a single notification and harmonised regime to ensure the process is predictable and saves businesses time and cost.

“The MoU lays out modalities through which the agencies will mitigate competition infringements with cross-border effects, as well as foster transparency and predictability with regard to multijurisdictional merger notifications in order to reduce transaction costs for businesses,” they said.

The two agencies have established a working group to implement several prioritised activities through annual plans.

“It is instructive that our maiden collaboration is with the CAK, a notable national competition enforcer in the region. Learnings drawn from this initiative will serve as a benchmark for future collaborations with national agencies in the Community,” said Ms Mukoronia, the EACCA Registrar.

The agencies will also review complementary regulations and guidelines to ensure they are fit for purpose and hold joint capacity-building sessions to ensure that case officers are up-skilled to adequately attend to emerging issues, especially those presented by the digital economy that transcends borders.

They will also collaborate in sensitising stakeholders about their respective laws and exchange best practices.