After the successful launch (and by now, first decade) of its Eastern regional counterpart, the COMESA Competition Commission, as of today, West Africa’s ECOWAS body likewise boasts a supra-national antitrust enforcement regime. AAT will be following its path closely.
By Jannes van der Merwe
The Economic Community of West Africa States (“ECOWAS”) was established by fifteen West Africa countries (“member states”) in 1975 when the member states signed the ECOWAS Treaty, with the aim and objectives to maintain and enhance economic stability and development in Africa.[1] The member states signed the revised treaty in 1975, currently governing the member states.
The current member states are Benin, Burkhina Faso, Cabo Verde, Côte d’Ivoire, The Gambia, Ghana, Guinea, Guinea Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sieera Leone and Togo.
Authority Established in 2008
In 2008 ECOWAS implemented two pieces of legislation through the authority of the treaty to steer the competition framework within the member states. The first was the Supplementary Act A/SA.1/12/08, and the second Supplementary Act A/SA.2/12/ 08.
Supplementary Act A/SA.1/12/08:
The purpose of this piece of legislation (known as the Community Competition Rules) nutshell is to promote competition, enhance economic efficiency, prohibit anti-competitive conduct that restricts or distorts competition, ensure consumer welfare and to expand opportunities for domestic enterprises of the member states. [2]
Supplementary Act A/SA.2/12/ 08:
The purpose of this piece of legislation was to establish a regional body to be known as the ‘ECOWAS Regional Competition Authority’ (“the Commission”) to govern, oversee and implement the Community Competition Rules.
The Commission
The formal launching of the Commission took place in May 2019. In December 2021, together with further enactment of legislation, the Council of Ministers of ECOWAS amended Supplementary Act A/SA.2/12/ 08 to, inter alia, enhance article 2, governing the bodies of the ERCA[3].
The amendment established two formal bodies of the ERCA, being the Council and the Executive Board of the ERCA, together with the Executive Directorate who is the administrative, investigative and implementing body of the Council’s decisions[4].
On 2 October 2024 the newly elected Council of the Commission will be sworn in at Banjul, the capital of the Republic of Gambia. See photo below.
This event will mark the dawn of a new day for competition in West Africa, whereby the Commission, through the Council, will become fully functional in order to administrate and give effect to the Competition Rules to member states.
Legal Framework
The Commission, through the Council, will be able to give effect to the preamble of the Treaty and align a vitally important piece that was missing from the practical application of the treaty.
The Community Competition Rules will be the governing legislation providing the umbrella under which the Commission will operate.
During December 2021, the Council of Ministers for ECOWAS further enacted regulations to govern the rules and procedures to give effect to the articles of the Community Competition Rules established in 2008.
A brief description of all the relevant legal framework will be discussed below.
The Competition Community Rules
The Competition Community Rules will regulate, inter alia, Agreements and Concerted Practices in Restraint of Trade; Abuse of Dominant Position; Mergers and Acquisitions; State Aid; Public Enterprises; Compensation for Victims of Anti-Competitive Practices; Authorisation and Exemptions; Agreements Concluded by Member States and the Application and Implementation of the Community Competition Rules[5].
ERCA’s Rules of Procedure in Competition Matters
Regulation C/REG.24/12/21[6] was established to set out the rules and procedures of the ECRA in competition matters and by doing so, harmonising competition laws, procedures, cooperations, investigations, exchange of information, decision making, enforcement, sanctions and compensation[7].
Supplementary Act A/SA.3/12/21
The amended act’s new article 3 provides a positive duty on the Commission to represent ECOWAS wherever necessary in matters of competition and consumer protection[8].
Mergers and Acquisitions in ECOWAS
Regulation C/Reg. 23/12/21[9] was established to set out the rules and procedures for mergers and acquisitions.
This regulation requires that merging parties of member states that meets the threshold will have to obtain prior approval before implementing. The merger threshold is governed by enabling Rule PC/REX.1/01/2024[10]
Leniency and Immunity Proceedings in Competition within ECOWAS
Regulation C/REG.22/12/21[11] was established to set out the rules, conditions and procedures of leniency and immunity applications to the Commission. Simultaneously, this regulation is a guide to the Commission in the exercise of its investigative and prosecutorial discretion in illegal cartels who, through their cooperation, help to reveal Cartel conduct[12].
Regulation C/REG.22/12/21 is accompanied with enabling Rule PC/REX.1/01/24[13] containing the manual for leniency and immunity applications and what leniency and immunity the Commission may grant for enterprises of member states which are engaged in anti-competitive behavior and who voluntarily disclose information to facilitate the Community Competition Rules.
Final Word
The operational ECOWAS Regional Competition Authority and the implementation of a functioning Council for the ECOWAS Regional Competition Authority is a leap forward in the West Africa competition sphere and will protect enterprises and enhance competition within the West Africa markets, providing benefits for entrepreneurs, enterprises and consumers.
[1] Article 3, ECOWAS Revise Treaty, 24 July 1993 (‘the treaty;’).
[2] Supplementary Act A/SA.1/12/08, Article 3.
[3] Supplementary Act A/SA.3/12/21 Relating to the Amendments of Supplementary Act A/SA.2/12/08.
[4] Article 2(new), Supplementary Act A/SA.3/12/21 Relating to the Amendments of Supplementary Act A/SA.2/12/08.
[5] Article 5-13, Supplementary Act A/SA.1/12/08.
[6] Regulation C/REG.24/12/21 on the ERCA’s Rules and Procedures in Competition Matters.
[7] Article 3, Regulation C/REG.24/12/21 on the ERCA’s Rules and Procedures in Competition Matters.
[8] Article 3(new), Supplementary Act A/SA.3/12/21 Relating to the Amendments of Supplementary Act A/SA.2/12/08.
[9] Regulation C/Reg.23/12/21 on the Rules of Procedure for Mergers and Acquisitions in ECOWAS.
[10] Enabling Rule PC/REX.1/01/24 on Manuals of the Procedures of the ECOWAS Regional Competition Authority.
[11] C/REG.22/12/21 on the Rules on Leniency and Immunity Procedures in Competition within ECOWAS.
[12] Article 1, C/REG.22/12/21 on the Rules on Leniency and Immunity Procedures in Competition within ECOWAS.
[13] Enabling Rule PC/REX.1/01/24 on Manuals of the Procedures of the ECOWAS Regional Competition Authority.
About half of these fees (approximately $1.5 million) were allocated to the national competition authorities in various COMESA states. However, competition authorities in COMESA member states – including Kenya, Zambia and Zimbabwe – continue to insist that merging parties lodge separate merger filings in their jurisdiction. This can add significant transactional costs – the filing fee in Kenya alone for a merger in which the merging parties combined generate more than KES 50 billion (about US $ 493 million) in Kenya is KES 2 million (nearly US $ 20 000). Since Kenya is one of the Continent’s largest economies, significant numbers of global transactions as well as those involving South African firms investing in African businesses are caught in the net.
African Antitrust & Competition Law 