• Competition policy

Competition policy

This paper seeks to demonstrate the importance of true and fair competition to sustainable development and an effective marketplace. It touches on issues of globalisation, consumer welfare, cartels and monopolies, and trade liberalisation.

It is argued that the growth of privatisation, and international trade and investment combined with the spread of bilateral and multilateral trade agreements have increased economic integration, affecting almost all nations of the world. This new reliance on private enterprise has brought about many changes in the economic structure and production capacity of developing countries. However, it has also made developing countries more vulnerable to new and harmful types of anticompetitive business practices. Competition law can play a role in the wider advancement of developing countries. It can also be used to stop bid rigging and expose corruption but the implementation of a competition law is fraught with problems. However, political will is necessary every step of the way. Competition law will not be broadly accepted or fully enforced unless key leaders in government have adopted market principles as the underpinning of economic development.


The following recommendations provide practical strategies for introducing and enforcing a competition law:

• in drafting and implementing competition law, enact legislation that is strong and supported Sound legal drafting is vital. The law must be designed to prevent opponents from undermining its aims
• it is also important to appoint and encourage strong leadership leading a competition authority — especially in its early years — requires determination, independence, and a tireless facility for public engagement. Strong competition authority leaders in countries as diverse as Australia, South Africa, and Zambia have demonstrated the power of lively media relations and public engagement
• in engaging stakeholders, recognise that not everyone will be your friend. Although outreach is important, not everyone that a competition authority wishes to engage with will share its enthusiasm for competition law and policy
• in dealing with cross-border anticompetitive conduct, institute both leniency programs and tough fines. In cracking cartels, a competition authority should use a leniency program in which the first cartel member to confess is provided with immunity from prosecution in return for cooperating in the investigation and surrendering all available evidence of wrong doing
  

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