The Ghana Office of the Consumer Unity and Trust Society (CUTS) International has urged the Government of Ghana and the Ministry of Trade and Industry (MoTI) to make Competition Regime a legislative priority for 2018.
Mr Appiah Kusi Adomako, Country Co-ordinator of CUTS Ghana, who made the call at a Policy Dialogue to mark on World Competition Day in Accra on Tuesday, therefore, urged businesses and the private sector to work closely together to ensure the development of a Competition Policy and the passage of a Competition Law for Ghana.
World Competition Day, which aims to raise awareness about competition-related issues, is celebrated in about 100 countries worldwide and was first marked in Ghana by CUTS in 2013.
This year's World Competition Day was celebrated in Ghana on the theme: Mergers and Acquisitions in the absence of Competition (Antitrust) Laws and sponsored by the Danish International Development Agency (DANIDA) European Union (EU) and the United States Agency for International Development (USAID).
Mr Adomako underscored the importance of a Competition Policy and Law in creating a level playing field in the marketplace, adding that a Competition Regime benefitted both producers and consumers.
He urged Regulators approving mergers and acquisitions transactions to give only conditional approvals if the merged entities would lessen competition.
Speaking on the theme, Mrs Frances Van-Hein Sackey, Head of Legal Department, Bank of Ghana (BoG), noted that Ghana had not been able to adopt a competition law over the years for the purposes of encouraging companies to offer consumer goods and services on more favourable terms and that the closest Ghana came to was the enactment of the Protection against Unfair Competition Act, 2000 (Act 589).
Mrs Sackey said notwithstanding the absence of a law on competition, the financial or banking industry in Ghana was a highly regulated sector that reflected the elements of fair competition.
It is for this reason, she said, that in the recent past, the mergers and acquisitions between Ecobank and Trust Bank; Acquisition of Merchant Bank by Fortes to create a new entity called Universal Merchant Bank; the Republic Bank take-over of HFC Bank; and the recent purchase and assumption transaction between GCB and UT Bank Ghana Limited and Capital Bank Limited had taken place seamlessly.
She said mergers and acquisitions of institutions regulated by the Bank of Ghana were supervised and regulated under the Banks and Specialized Deposit-Taking Institutions Act, 2016 (Act 930), Section 52 which deals with the sale of businesses, mergers, amalgamations and reconstructions of banks and specialized deposit-taking institutions.
Mrs Sackey said the purpose of receiving and reviewing applications on proposed mergers and acquisitions was for BoG to ensure fairness during the process and to make sure that customers of financial institutions as well as the general public as a whole were not hurt when these transactions went through.
She said notwithstanding the progress made in mergers and acquisitions in the banking and financial sector in the absence of a competition law, a functional competition regime for Ghana was an essential national requirement.
In a presentation on the topic: "Market Distortions and anti-Competitive Trade Practices―The Case of Price Fixing by Trade Associations in Ghana," Mr Isaac Yaw Obeng, Research Assistant, CUTS Ghana, defined Price Fixing as an agreement between participants on the same side in a market to buy or sell a product, service, only at a fixed price or maintain the market conditions such that the price is maintained at a given level by controlling supply and demand.
Mr Obeng explained that a Competition Law required that each company established prices and other terms on its own without agreeing with the competitor.
He said Price Fixing was not a healthy practice because it ripped consumers off and did not encourage competition among market players nor promote innovation.
Other speakers―Mr Yoofi Grant, Chief Executive Officer (CEO), Ghana Investment Promotion Centre (GIPC), Dr Francisca Kusi-Appiah, Lecturer in Law, University of Professional Studies, Accra (UPSA) and Mr Emmanuel Doni-Kwane, Managing Director, World Trade Centre― agreed that competition was a fundamental tenet of well-functioning markets, encouraged companies to provide consumers with the products and services that they wanted and resulted in the lowering of prices for goods and services, better service quality, wider choices for consumers, stimulation of innovation and, more importantly, efficiency in allocation of resources.
Mr Kofi Amenyah, Director, Legal Affairs, MoTI, gave the assurance that a Draft Competition Bill would become Law in 2018.
Dr Justice Samuel Date-Baah, Board Chairman, CUTS Ghana and Chairman for the occasion, noted that businesses and consumers in Ghana continued to suffer largely due to the absence of a functional competition regime in the country.
Dr Justice Date-Baah explained that that in absence of competition, firms engaged in bad practices like the abuse of monopoly, price fixing, cartelization of goods and services, bid rigging and exclusive market sharing agreement, among others.
He said a competition law was key to consumer protection as well as industry growth and that a functional competition regime consisted of a national competition policy and a competition law implemented by a well-resourced competition authority.
CUTS Ghana is a public policy research and advocacy think tank, which is registered as a non-profit organization which works in the areas of consumer protection, economic regulation, trade and development, regional integration and competition policy and law, among others.
Ghana as a country does not have a functional competition regime and it is expected that the efforts of CUTS through the CREW and COMPAD projects would feed into developing a sustainable competition policy and law for the country.
With funding support from the Business Advocacy Challenge (BUSAC) Fund, CUTS Ghana recently launched a project referred to as the Competition and Advocacy Project (COMPAD Project).
The 15-month project, titled "Advocating for a Functional Competition Regime/ Framework," was to be implemented in three phases, with the aim of complementing government's efforts towards evolving a functional national competition policy and law in Ghana.
Apart from the COMPAD Project, CUTS also executed the Competition Reforms in Key Markets for Enhancing Social and economic Welfare in Developing countries (CREW Project).
The project, involving three Ministries-- Transport, Food and Agriculture, and Trade and Industry, with ISSER as its research partner --was to demonstrate measurable benefits from an effective competition policy and law regime in developing countries for ensuring competition reforms
Source: ISD (G.D. Zaney)