The Namibian Competition Commission (NaCC) on 26 February 2021 transferred N$27.1 million to the State Revenue Fund, which originated from penalties it collected and is in fulfilment of its obligation with the provisions of the Competition Act. In 2018, the Commission, a statutory body mandated to safeguard and promote competition in Namibia, transferred pecuniary penalties amounting to N$15.4 million to the State Revenue Fund, which are paid upon completion of the audit of the funds by the Auditor General.
Section 53 of the Competition Act provides that pecuniary penalties collected by the Commission must be paid into the State Revenue Fund.
“Non-compliance with the provisions of the Competition Act is a serious matter and could result in an investigation by the Commission, and the referral of the matter to the High Court for the imposition of a pecuniary penalty against contravening undertakings. The Commission, therefore, urges all undertakings doing business in Namibia to ensure compliance with the Act,” read a statement issued by NaCC spokesperson Dina //Gowases.
She noted that the Commission contributes to the economy in various ways, most notably through merger control, the investigation of restrictive business practices, economic research and advocacy. Through its work in these areas, the Commission contributes towards the creation of a level playing field for all undertakings doing business in the country, regardless of size, by ensuring competition in the marketplace. The Commission plays the role of a referee, ensuring that everyone plays by the rules.
//Gowases explained that although the Commission encourages businesses to comply with the Competition Act through its advocacy function, when non-compliance is detected, it is investigated and strict action taken against contravening businesses.
“While general compliance to the provisions of the Act is observed, there are few incidents where non-compliance was and is still being detected. It is important to understand that non-compliance with the Act disturbs/disrupts the competition equilibrium in the economy or in certain sectors of the economy,” she added.
Thus, when businesses engage in anti-competitive practices or implement mergers without obtaining the Commission’s approval, the Commission has the power to refer the matter to the High Court for certain relief to be imposed. This relief may include the imposition of a monetary penalty.
Alternatively, the Commission and the contravening parties may enter into a consent agreement proposing the pecuniary penalty to be imposed. Said //Gowases: “The implementation of these measures, as provided for in terms of section 53 of the Act, has resulted in the collection of pecuniary penalties in the amount of N$27.1 million. The penalties were imposed in five cases involving undertakings which contravened the Act, and it was agreed to enter into consent agreements with the Commission that were made orders of the High Court”.
The Act provides that a monetary penalty be imposed for any amount which the court considers appropriate, but not exceeding 10% of the global turnover of the undertaking during its preceding financial year. Section 53(2) of the Act provides that in determining an appropriate penalty, the court must have regard to all relevant matters concerning the contravention. This, the Act stipulates, includes “the nature, duration, gravity and extent thereof; the nature and extent of any loss or damage suffered by any person as a result thereof; the behaviour of any undertaking involved; the market circumstances in which it took place; the level of profit derived therefrom; the degree to which the undertaking involved has co-operated with the Commission and the court; and whether the undertaking has previously been found by the court to have engaged in conduct in contravention of the Act”.