Comesa receives $3.1m in merger filing fees

THE Comesa Competition Commission has received over $3.1 million dollars in merger filling fees between last December and October 2016.

Comesa said this had been revealed at the trading bloc’s on-going 19th Summit and Policy Organs Meeting in Madagascar. The summit began on October 10 and will culminate with the Heads of States Summit today and tomorrow.

It is hoped that out of the more than $3.1 million in excess of $1.5 million dollars will be allocated to relevant competition authorities in designated member countries.

According to the commission’s performance brief presented to the Council of Ministers meeting in Madagascar at the on-going 19th Comesa Summit and Policy Organs Meeting, the Commission assessed 24 merger cases as at July 2016.

More than 70 percent of the mergers received were in the financial services sector with the rest in construction, insurance, telecommunications, energy and agriculture. A majority of the mergers assessed in 2016 affected Kenya, Zambia, Mauritius, Zimbabwe, and Uganda.

“The case of Zambia and Kenya may be explained by the fact that their economies are relatively large and have outward looking policies, which provides a conducive environment for businesses including attracting foreign direct investment,” said the commission’s chief executive Mr George Lipimile.With regard to Mauritius, most of the firms operating in the Common Market have their holding parents in Mauritius.

Egypt and Ethiopia are among the largest economies in Comesa, despite recording relatively less cross-border mergers affecting them. This can be attributed to their economies being generally in-ward looking with robust local firms which merge among themselves.

“Regarding the prominence of mergers in the service sector, this may be attributed to the diversification efforts of the Common Market in moving from the traditional trade in goods towards trade in services.

“It may also be attributed to the emergence of a middle class in most of economies in the Comesa,” it said.

The Commission retains 50 percent of the Common Market merger filing fees and distributes the remaining 50 percent among the relevant competition authorities in the designated member States. The share of the Common Market merger filing fees for each relevant competition authority in the designated member State is proportional to the value of the turnover in each State relative to the total value of the turnover in the common market.

The Commission intends to intensify its technical assistance and capacity building in member countries with particular focus on the training of the national competition authorities on the enforcement of the regulations.

“Our focus in 2017 shall be on advocacy in order to sensitise national governments and other stakeholders on the provisions of the Regulations and the need for domestication of the Comesa Treaty and Regulations,” said Mr Lipimile.

Meanwhile, the Comesa Council of Ministers has adopted the organisation’s Medium Term Strategic Plan for 2016– 2020.The plan is expected to contribute to structural transformation of the economies of the Comesa member States to foster overall economic development of the member States through trade, investment and regional infrastructure development.

Ministers participating in the Council meeting noted that the MTSP has been aligned with the Treaty, the Global Sustainable Development Goals and the Continental Agenda 2063.

Developed under the theme “In pursuit of Regional Economic Transformation and Development”, the Plan identified nine Strategic Objectives to drive the regional integration agenda for the period 2016-2020. These include: Strengthening Market Integration, Attracting Increased Investments, Strengthening Development of Economic Infrastructure, industrialisation, Blue Economy, Gender and Social development, capacity building and Regional and Secretariat readiness. — @ okazunga