TODAY, we focus on the Competition and Consumer Protection Act number 24 of 2010, which as the name entails, promotes competition as well as protects consumers against unfair trade practices.
Further, the Act, which renamed the then Zambia Competition Commission to the current Competition and Consumer Protection Commission (CCPC), provides for the establishment of the Competition and Consumer Protection Tribunal.
Basically, this Act’s main preoccupation narrows down to two areas, firstly the protection and promotion of competition and secondly, the protection and promotion of consumer rights.
I was last week privileged to have attended the media training workshop on competition and consumer protection organised by the CCPC in Siavonga District of Southern Province.
The workshop – which was graced by Commerce, Trade and Industry Minister Robert Sichinga – comprehensively tackled the Act and its subsidiary regulations.
Historically, the issue of the competition became imperative with the liberalisation of the economy in the early 1990s.
Like CCPC executive director, Chilufya Sampa indicated, prior to the liberalisation, more than 80 per cent of companies were state-owned while price and product controls were the order of the day.
Further, products were somewhat homogenous whereby almost all Zambians – save those who were able to go out of the country – consumed the same products.
With the dawn of multipartism which ushered in the free market economy, it became imperative to introduce some competition policies and laws to ensure sanity in the economic sector.
This, somehow, removed the undue advantage some of the parastatal firms were enjoying thereby introducing some semblance of evened playing field.
On the other hand, however, some Government-owned firms which could not stand without the Government undue support went under through liquidations and other forms of closure.
But why do we need the competition law? Why can’t we just let the market regulate itself, more so since we are in the free market economy?
If the competition is not promoted anti competition behaviours will reign, resulting in unjustifiably high prices of goods and services as well as limited choices of products for the consumers.
This will be because there will be cartels in all the sectors which could fix the prices of goods and services above the competitive levels thereby disadvantaging the consumers.
Some big entities will use their dominant positions to bulldoze others into fixing the prices and making other decisions which are supposed to be influenced by the market forces of supply, demand and price.
Without the competition law the consumers will have limited choices of products in that the cartels, using some anti-competition tactics, will block any new entrants into the sector or enter into some anti-competitive mergers to kill off the competition.
The members of the cartels will agree on how much to produce and at what price.
Innovation is one of the main advantages of the liberal economy but the anti competitive tendencies it is eliminated.
The innovation is eliminated in that cartel members agree on which areas of production they should restrict themselves to and pursue the market exclusion arrangement using their dominant positions.
Apart from lack of innovation the situation will also result in low quality of products because of lack of competition.
This is promoted by the abuse of the firms’ dominant positions which are compounded by the anti-competitive mergers which literally perpetuate the lack of competition.
In essence, this is one of the main ills the law aims to address.
As already indicated, the law also targets at promotion and protection of the consumers by upholding their rights.
There are eight basic consumer rights which the Act aims to protect and these rights are not unique to Zambia but are universal.
The Act aims to protect the consumers’ right to satisfaction of basic needs which every human being can survive on.
The consumers have the right to safety meaning that they should be protected against harmful products, production processes and services.
The Act states that: “A person or an enterprise shall not sell any goods to consumers unless the goods conform to the mandatory safety standard for the class of goods set by the Zambia bureau of Standards or other relevant competent body.”
The consumers have the right to be informed meaning that they should be given the full facts about a product so that they could make informed choices.
According to the Act it is an offence to engage in a conduct which is likely to mislead the public that goods are of particular origin, standard, quality, value, grade, composition, performance, style or model.
All consumers have the right to choice of products – they should be able to pick from a range of goods or services being offered on the market at a competitive price.
The right to be heard entails that the consumers’ concerns should be taken into consideration while the right to redress calls for fair settlement of just claims including compensation.
This right makes it illegal for traders to display disclaimers like “No return, no refund.”
The consumers are also entitled to education on the products and services so that they could make informed choices while the right to healthy environment is also imperative.
I intend to revisit this subject soon to try and exhaustively tackle it because there are still many cardinal elements remaining to be looked at including some practical examples.
For comments call: 260 0955 431442, 0977 246099, 0964 742506 or email:
jmuyanwa@gmail.com.