By Gina Lodolo

In a move towards ensuring fair competition in Morocco’s fuel market, the Morocco Competition Council (“MCC”) recently took decisive action. This decision followed amendments to the legal framework governing competition in Morocco, aligning it with Laws No. 40.21 and No. 41.21, which amended and supplemented Law No. 104.12 related to freedom of prices and competition, and Law No. 20.13, which pertains to the Competition Council, along with their implementing decrees and their entry into force. In this regard, in June 2023, the MCC initiated an investigation into potential practices that contravened competition rules within the fuel market.

The complaints were filed against nine companies operating in the supply, storage, and distribution of gasoline, along with the professional organisation representing these companies (the “Companies”).

In response to the investigation, the Companies expressed their willingness to engage with the new legal framework, particularly the settlement procedure outlined in Article 37 of Law No. 104.12, as amended and supplemented.

The MCC considered and approved the requests submitted by the Companies to enter into discussions. The General Rapporteur was tasked with initiating official discussions with each company and its professional organisation separately. The result of these discussions was the signing of reconciliation minutes, documenting the approval of the reconciliation proposals.

On 23 November 2023, the MCC issued a report detailing reconciliation agreements that had been entered into with the Companies, stipulating that the Companies would collectively pay an amount of 1,840,410,426 Moroccan dirhams as a reconciliatory settlement. In addition to the financial commitment, the Companies made a set of pledges aimed at improving the competitive functioning of the fuel market and preventing anti-competitive practices.

These commitments are legally binding and include:

1. Developing competitive risk maps within the Companies.
2. Establishing effective internal warning systems.
3. Appointing an internal official responsible for overseeing the conformity program.
4. Providing detailed reports on supply, storage, and distribution activities every three months for a period of three years.
5. Ensuring that price changes align with market dynamics.
6. Allowing independent service stations to change prices without prior approval.
7. Not linking discount programs to service stations with compliance with recommended prices by the Companies, directly or indirectly.

The commitments also emphasised the importance of preventing anti-competitive practices related to the exchange of sensitive information. In this regard, the Companies committed to adopting best practices regarding the collection, exchange, or sharing of information, especially in the management of shared infrastructure for storage and distribution.

To ensure the effective implementation of these commitments, the MCC will be closely monitoring and evaluating compliance. In this regard, the Companies are required to provide periodic evaluation reports, demonstrating their commitment to the agreed-upon measures.

The MCC’s proactive approach in addressing potential anti-competitive practices in Morocco’s fuel market through reconciliation agreements is a significant step forward and signifies robust and increased enforcement activity in Morocco.

The full MCC Report is accessible here.