Parliament passes bill regulating competition among businesses
Parliament has passed the Competition Bill 2022 that will facilitate fair competition in markets and prevent practices having adverse impacts on competition in markets.
The bill primarily seeks to control anti-competitive behaviour of firms that has a negative impact on competition in Uganda’s market.
The Minister of State for Industry, Hon. David Bahati said the Bill proposes establishment of a comprehensive legal regime on competition in Uganda to avoid certain activities in the market that hurt the businesses or consumers and curb practices violating ethical practices.
The Committee on Tourism, Trade and Industry endorsed the Bill with a few recommendations stating that it will be beneficial to the public resulting in robust competition, lower prices, higher quality of goods and services and greater innovation while protecting the end users.
Among the major recommendations of the committee is the formation of an Independent Commission charged with supervising competition matters which are usually cross-cutting and shall require specialised persons that the supervisory ministry does not have.
“The absence of the specialised independent body administering and enforcing the Bill would reduce the public’s confidence and therefore, its credibility,” said the Deputy Chairperson of the Committee on Tourism, Trade and Industry, Hon. Catherine Lamwaka.
The Deputy Speaker, Thomas Tayebwa who chaired the sitting of the House on Thursday, 25 may 2023 said he had suffered the consequences of the poor regulation of competition having lost a business he run earlier to a bigger one and believed the proposed Bill would go a long way in resolving unfair competition.
The legislators emphasised the need for the bill to address and regulate government enterprises that usually try to dominate markets or business sectors within which they operate.
Hon. Nathan Nandala Mafabi (FDC, Budadiri County West) noted that the government should be regulated from entering business ventures and making agreements which out rightly favour it.
Nandala Mafabi said the law should prohibit government from entering any partnership and operating like any other ordinary business, yet it has got more resources at its disposal and does not necessarily typically pay tax.
Sheema Municipality MP, Hon. Dickson Kateshumbwa supported the idea of an independent commission stating that the ministry is not in position to regulate the bill because it is compromised by the fact that it is part of the government which runs businesses that will be subject to regulation.
He added that businesses in dominant positions should be regulated under the bill especially in instances where a government owned enterprise is the dominant player because these tend to wrestle out any form of competition.
“State-owned businesses are usually dominant players and leave little room for the private players so they must be regulated by an independent body,” Kateshumbwa noted.
He said that the definition of a dominant position should be extended to include the government especially since some of its practices may be discriminatory like giving out incentives to one enterprise.
The Bill, as passed, prohibits monopolies arising from enterprises entering and operating under joint ventures and mergers, and engaging in practices that prohibit other players in the field of business including government run businesses.