WINDHOEK – Namibian Competition Commission (NaCC) is seeking input from interested parties such as the National Petroleum Corporation of Namibia (Namcor)’s customers and competitors in respect of the competitive implications of the proposed reinstatement of the petroleum importation mandate.
This, after Namcor applied to be exempted from certain provisions of the Competition Act in respect of the proposed reinstatement of its mandate to import 50 percent of the country’s petroleum needs.
In its application Namcor seeks an exemption for a period of 10 years.
Furthermore, as part of the consideration of the exemption application, NaCC has, in line with section 27(3) of the Competition Act, this month published a notice in the Government Gazette inviting interested parties to submit, within 30 days, to the Commission any queries or written representations that they may wish to make concerning the application.
“Provided that there are exceptional and compelling public policy reasons for doing so, the Commission will after consideration of the application and any representations submitted by interested persons make a determination on whether or not to grant or refuse the exemption application provided that there are exceptional and compelling public policy reasons,” read a statement from the NaCC’s Enforcement, Exemptions and Cartels Division.
Namcor’s exemption application relates to a category of proposed decisions to be issued in terms of the Petroleum Products and Energy Act, 1990 and the Petroleum Products Regulations, 2000; to amend the wholesale licences of the present importers of petroleum products by imposing conditions on the percentage volumes for the procurement of petroleum products, and reinstating the mandate to import 50 percent of Namibia’s petroleum needs to Namcor.
The recent NaCC statement clarified that the Commission is not the entity responsible for determining whether or not Namcor is entitled to the reinstatement of the 50 percent petroleum importation mandate, as this power is vested with the Minister of Mines and Energy in terms of the relevant legislation governing the petroleum industry. “The exemption application that is currently before the Commission is instead aimed at enabling the Commission to assess whether or not there are exceptional and compelling public policy justifications that would warrant the exemption of the reinstatement of the mandate from the provisions of the Competition Act,” read the NaCC statement.
An exemption application is an avenue whereby an undertaking such as Namcor can apply to the Commission to be exempted from the provisions of the Competition Act in respect of agreements, decisions or concerted practices. What an exemption therefore means is that an undertaking that has been exempted from the Competition Act will not be held liable for a contravention of the Competition Act if the particular conduct by the undertaking has been exempted from the Competition Act.
In making a decision in respect of whether or not to grant or refuse Namcor’s exemption, the Commission is, in terms of the Competition Act, required to take into account the extent to which the proposed reinstatement of the 50 percent petroleum importation mandate to Namcor would contribute or result in maintaining or promoting exports and enabling small undertakings owned or controlled by historically disadvantaged persons, to become competitive. NaCC will also take into account the extent to which the mandate would improve or prevent decline in the production or distribution of goods or the provision of services as well as promoting technical or economic progress or stability in any industry designated by the Minister, after consultation with the Minister responsible for that industry. Also to be considered is whether it will contribute to obtaining a benefit for the public which outweighs or would outweigh the lessening in competition that would result, or would be likely to result, from the agreement, decision or concerted practice or the category of agreements, decisions or concerted practices. The Commission may grant an exemption subject to such conditions and for such period as the Commission may think fit.
“The Commission furthermore wishes to use this platform to commend the proactive approach towards ensuring compliance with the Competition Act that has been taken by undertakings such as Namcor by seeking an exemption in respect of the proposed reinstatement of the 50 percent petroleum importation mandate. Other undertakings are thus cautioned that they cannot without having sought an exemption from the Commission proceed with conduct that contravenes the Competition Act and thereafter seek to avoid liability for having contravened the Competition Act simply because the conduct in question has public policy justifications. In order for an undertaking to be excluded from liability for having contravened the Competition Act, the exemption must be sought and granted before the undertaking in question engages in the relevant conduct,” the NaCC cautioned.