a tripartite report - Unctad

ZIMBABWE
of restrictive practices, the regulation of mergers,
the prevention and control of monopoly situations
and the prohibition of unfair trade practices, and
to provide for matters connected with or incidental
to the foregoing. Like other competition laws,
the Zimbabwean covers (i) Anticompetitive Agreements
in both vertical and horizontal aspects (ii)
Abuse of Dominant Position (iii) Merger Control.
Furthermore, it contains provisions relating to Unfair
Competition / Consumer Protection.
The Competition Act applies to all economic activities
within or having an effect within the Republic
of Zimbabwe. It does not draw a distinction
between Regulated Sectors (natural monopolies
especially found on utility networks).
2.1 Anticompetitive Agreements
While the ZCA distinguishes between various
forms of objectionable conduct, namely unfair
business practices, 182 restrictive practices 183 and
unfair trade practices, 184 it does not contain a provision
for general prohibition of anticompetitive
agreements. However, the CTC is empowered to
prohibit restrictive practices on an individual basis
the restrictive practice is contrary to public interest.
Agreements which are commonly considered
as anticompetitive are partly provided for by the
ZCA’s category of unfair business practices.
According to the current wording of the ZCA only
unfair trade practices constitute an offence and are
in section 42 (3) ZCA, while unfair business practices
are only sanctioned by nullity as provided in section
43 (a) and (b) ZCA. The absence of sanctions
for unfair business practices in section 42(3) of the
ZCA was occasioned by possible drafting omissions
at the time the ZCA was amended by the 2001
Amendment. After repealing the Tariff Commission
Act [Chapter 14:29] and incorporating its provisions
which predominantly covered unfair trade practices
into the ZCA, the 2001 Amendment sought to
substitute all terms referring to “unfair trade practices”
in the former Competition Act, 1996 with the
term “unfair business practice” in order to avoid
confusion as the two terms were now intended to
mean different things. Unfortunately for section 42,
only the section heading and subsection (1) were
amended leaving out subsection (3). This therefore
177
left subsection (3) prohibiting unfair trade practices
when the section was supposed to be dealing with
unfair business practices as per its heading and
subsection (1). The other absurd result of this omission
is that unfair trade practices as provided for in
sections 34B and 34C are practices that are related
to imports and are mainly perpetrated at national
level and not by individual persons and hence
the legislature could not have intended to impose
criminal sanctions on nation States. Thus, one can
safely conclude that the legislature intended to delete
“unfair trade practices” wherever it appeared
in section 42 and substitute it with “unfair business
practice” as was done to section 43. This anomaly
however can only be cured by another amendment
to the ZCA as it stands. As such, the matter calls for
urgent intervention as it poses a huge potential for
offenders to take advantage of the weakness in the
ZCA to harm competition without fear.
The ZCA covers the rule of reason and per se approach
in both horizontal and vertical agreements.
tions
as provided in Section 2; one can construe
the provision that restrictive practices are dealt
with by invoking Rule of Reason approach whereas
unfair business practices that are listed in the First
Schedule are dealt with under the Per Se approach.
However, the distinction is not as sharp because of
the double provision for issues under Section 2 and
addressing per se and rule of reason prohibitions
separately is considered a shortcoming, that needs
to be addressed so as to ensure that users get a
clear grasp of the provisions from onset.
issues usually termed under abuse of dominance
such as overcharging, refusal to deal, retail price
maintenance and exclusive dealing. There are
also unfair competition issues provided for such
as misleading advertising and false bargain. The
corollary of this mix-up of issues is restraint to both
interpretation and enforcement of these very core
provisions of competition legislation.
2.1.1 Restrictive Practices in the Act
Ideally Section 2 of the Competition Act can be
construed to provide for Rule of Reason issues.
as follows:
ZIMBABWE