a tripartite report - Unctad

126 VOLUNTARY PEER REVIEW OF CLP: A TRIPARTITE REPORT ON THE UNITED REPUBLIC OF TANZANIA – ZAMBIA – ZIMBABWE
regard included the following: (i) the Commission
seeks the views and comments of the relevant
stakeholders in its examination of mergers (Pensions
and Insurance Authority, Zambia Development
Agency, Bank of Zambia, Zambia Association
of Chambers of Commerce and Industry); (ii) the
Commission always gives professional advice on
policy issues related to mergers and acquisitions
(Musa Dudhia & Co. Legal Practitioners); (iii) the
merger examination procedure at the Commission
ings
with the Commission are very helpful (Corpus
Legal Practitioners); and (iv) the Commission gives
adequate support to merging parties (Zambian
Breweries Plc, MTN (Zambia) Limited. Corpus Legal
Practitioners gave the Commission an 8, on a scale
of 0 to 10, for the effective implementation of the
merger control provisions of the new Act.
The general stakeholder sentiment was that the
new Act when compared with the old Act has
been a milestone in merger control since it captures
virtually everything on such control. For ex-
provided for. The inclusion of the mining industry
in the application of the Act was a positive development
since mining is the major economic activity
in the country that generates a lot of mergers
and acquisitions.
Some stakeholder concerns were however expressed
over some aspects of merger control in
Zambia. Musa Dudhia & Co., one of the two lead-
mergers and acquisitions in assisting enterprises
in applying for the Commission’s authorization of
such transactions, felt that not enough sensitization
of the business community is being done on
changes in policy, and general assessment of
mergers.
The Bank of Zambia, the country’s central bank,
sions
on mergers. For example, it queried why a
merger of the country’s two largest breweries be
approved, and why a dominant brewery be allowed
to acquire a soft drinks company. The Commission
explained that the merger transactions
referred to by the Bank involved the 1999 acquisition
of Northern Brewery by Zambian Breweries
to form Zambian Breweries Group, and the
acquisition of the Coca-Cola beverages brands
by Zambian Breweries Group. In both cases, the
approved mainly for public interest reasons, but
with conditions aimed at minimizing the effects of
Another issue that caused some stakeholder concerns
was the Commission’s practice of charging
an extra fee, over and above the normal merger
of urgent merger transactions. Musa Dudhia &
Co. Legal Practitioners submitted that its foreign
clients usually ask how soon a merger determination
is made after paying the extra fee since
these guidelines are not given by the Commis-
adequately explained to the business community.
The Commission explained that the charging of
extra merger examination expedition fees, which
has now been discontinued in the Regulations to
the new Act since the Act now provides for spe-
-
extraordinary meetings of the Board of Commissioners,
at double the normal Board sitting fees, to
consider the urgent mergers.
All the above stakeholder concerns over some aspects
of merger control in Zambia highlight the
need for comprehensive Merger Control Guidelines
for the information of the business community
and other stakeholders.
It is recommended that the Commission’s
Merger Control Guidelines that are in
the process of being redrafted for the
adoption by the Board of Commissioners
cover pertinent issues such as merger
assessment of mergers, and any other
current merger control practices.
(c) Part V: Market Inquiries
The undertaking of market inquiries has been introduced
in the new Act. In terms of section 38
of the Act, “the Commission may initiate a market
inquiry where it has reasonable grounds to suspect
that a restriction or distortion of competition
is occurring: (a) within a particular sector of the
economy; or (b) within a particular type of agreement
occurring across various sectors”.