BY PHUMELELE GAMEDZE
MBABANE– Local businesses and consumers could be better protected from unfair business practices that stretch across the border following renewed cooperation between competition authorities in Eswatini and South Africa.
The Eswatini Competition Commission (ESCC) and Competition Commission South Africa (CCSA) have renewed their Memorandum of Understanding (MoU), creating a formal framework through which the two institutions can share information, cooperate on investigations and deal more effectively with competition matters involving companies operating in both countries.
For an ordinary Eswatini business, the agreement could make a significant difference.
If, for example, a local company becomes involved in a competition dispute where crucial information is held by a business in South Africa, the ESCC cannot simply cross the border and demand that information because its legal jurisdiction ends in Eswatini.
Under the renewed cooperation arrangement, however, the Commission can work directly with its South African counterpart to obtain assistance within the laws of that country.
Speaking on Eswatini TV’s MarketView, ESCC Chief Executive Officer Siboniselizulu Simelane said the agreement was designed to make cooperation easier when anti-competitive conduct crossed national borders.
“The MoU sets out a framework which allows us to engage with the South African Competition Commission when we have any anti-competitive conduct that comes from South Africa,” Simelane said.
The first agreement between the two competition authorities was signed in 2018 before it expired. Negotiations subsequently continued towards renewing the partnership.
Importantly, Simelane explained that the MoU does not give the ESCC additional enforcement powers.
Those powers continue to come from Eswatini’s competition legislation.
Instead, the agreement establishes how the two regulators can cooperate, exchange information and protect confidential material when dealing with cases affecting both countries.
“It does not give us new enforcement powers because we draw the enforcement powers from the Act. But what it does is strengthen cooperation because we agree on how we can cooperate and how we share information,” Simelane explained.
CROSS-BORDER CASE SHOWS WHY AGREEMENT MATTERS
Simelane recalled a previous investigation involving an Eswatini company and a South African company where local investigators required information that was held across the border.
The challenge was straightforward: the ESCC had no authority to enter South Africa and independently obtain the information.
“We do not have jurisdiction in South Africa, and we cannot go and get information from them in South Africa,” Simelane said.
The Commission therefore approached its South African counterpart, which was able to provide assistance using its own legal framework.
“They assisted under their legal framework to effectively open the doors and allow us to get the work done,” Simelane said.
The renewed MoU therefore gives competition officials a clearer channel to cooperate when investigations involve companies, documents or commercial conduct spanning both jurisdictions.
This could prove particularly important considering the close economic relationship between Eswatini and South Africa and the large number of businesses involved in cross-border trade, mergers, acquisitions and other commercial activities.
WHY CONSUMERS SHOULD CARE
While competition law can sometimes appear technical, its effects can eventually reach the pockets of ordinary consumers.
Competition authorities examine business conduct that may influence prices, consumer choice, access to markets and the ability of smaller businesses to compete fairly.
Through the renewed agreement, officials from Eswatini and South Africa will be able to communicate more closely when assessing transactions that could have different effects in the two countries.
Simelane said Eswatini’s relatively small market means competition officials must carefully examine how major commercial transactions could affect local consumers and businesses.
Case officers can now engage their counterparts and compare concerns when assessing cross-border mergers or other transactions.
“We are able to say our market in Eswatini is small and these are the anti-competitive effects that are going to arise. How have you looked at this merger? Is this a similar concern for you?” Simelane explained.
SMEs ALSO STAND TO BENEFIT
Another important area of cooperation is the participation and growth of small and medium enterprises.
Eswatini stands to learn from South Africa’s experience in promoting more inclusive markets, particularly in ensuring that SMEs are not merely allowed into markets but are also given a meaningful opportunity to grow.
“An inclusive market is one where the SMEs have meaningful participation,” Simelane said.
“It means that not only must the SMEs enter the market, but their engagement must be meaningful. Their engagement must be effective and we must see growth as well.”
For a small Eswatini enterprise affected by the conduct of a larger company operating across the border, access to relevant information can be critical.
The renewed agreement creates a recognised channel through which the two regulators can communicate and assist one another while respecting their respective laws and jurisdictions.
ESWATINI ALSO BRINGS EXPERIENCE
Simelane stressed that the cooperation should not be viewed as Eswatini simply learning from its larger neighbour.
“The learning is actually both ways,” Simelane said.
Eswatini has previously handled competition matters from which South African authorities have also been able to draw lessons.
Simelane pointed to an exclusive lease agreement case previously enforced by the ESCC before South Africa dealt with a similar matter.
South African competition authorities were subsequently able to look at Eswatini’s experience.
“So the learning can be on work that we have done previously. It can be on work that is ongoing currently, and then the learning can be futuristic as well,” Simelane said.
Ultimately, the success of the renewed partnership will be measured not merely by the signing of the agreement, but by what happens when real cases emerge.
Its impact could be reflected in cross-border investigations, information-sharing requests, merger assessments and the speed with which authorities are able to respond when potentially anti-competitive conduct involves businesses operating on both sides of the border.
For local businesses, particularly SMEs, the agreement provides a stronger cooperation mechanism when competition problems extend beyond Eswatini’s borders.
For consumers, its value could ultimately be seen in better-informed competition decisions aimed at safeguarding fair markets, choice and effective competition.
(Courtesy Pic)
