This note highlights the 6 month Amnesty Programme currently being conducted by the Zambian Competition and Consumer Protection Commission (CCPC).

2 April 20

The Amnesty Programme
The Amnesty Programme is an initiative of the CCPC which is giving an opportunity to enterprises engaged in restrictive business practices (RBPs) and/or cartel conduct to apply for amnesty and desist from further abrogating the Competition and Consumer Protection Act, No 24 of 2010 (the Competition Act) in exchange for a waiver of fines and immunity from possible prosecution.

The Amnesty Programme will run for 6 months, from 1 September 2019 to 28 February 2020. The Amnesty Programme focuses on all subsectors of the economy and covers agreements deemed as anti-competitive or restrictive of competition under the Competition Act.

The Amnesty Programme is being conducted in accordance with section 79 of the Competition Act which provides as follows:

“(1) The Commission may operate a leniency programme where an enterprise that voluntarily discloses the existence of an agreement that is prohibited under this Act, and co-operates with the Commission in the investigation of the practice, may not be subject to all or part of a fine that could otherwise be imposed under this Act.”

Through the Amnesty Programme, the CCPC is encouraging enterprises to come forward with information that helps to demonstrate the existence of an anti-competitive agreement. The information provided should be of such degree that it increases the chances of proving the existence of a prohibited agreement which the CCPC would not have been privy to without an investigation.

The Amnesty Programme is limited to restrictive business and anti-competitive trade practices under Part III of the Competition Act. The Amnesty Programme does not extend to mergers or unfair trading under Parts IV and VII of the Competition Act.

Anti–Competitive Conduct Covered under the Amnesty Programme
Agreements which are anti-competitive or restrictive of competition under the Competition Act include RBPs and cartel conduct.

RBPs include any agreement, decision or practice which has the object or effect of preventing, restricting or distorting competition in Zambia. For example, an agreement which restrains a counter party from trading with third parties.

Cartel conduct includes prohibited horizontal agreements under the Competition Act. Prohibited horizontal agreements are agreements between competitors which fix prices or other trading conditions, divide the market by allocating customers, suppliers or agreements, or provide for the collective refusal to deal in or supply goods and services. The penalty levied on enterprises for cartel conduct is a fine of not more than 10 percent of the enterprise’s annual turnover or imprisonment of up to 5 years.

How Can One Apply for Amnesty Under the Amnesty Programme?
Enterprises may benefit from the Amnesty Programme by writing to the CCPC and providing the CCPC with the details of the enterprises involved in the anti-competitive conduct, addressing the nature of their anti-competitive conduct and indicating that they are approaching the CCPC under the Amnesty Programme. Depending on the anti-competitive conduct reported by the enterprise, they will be guided by the CCPC on whether further information or documentation is required.

What to Expect from the Amnesty Programme
Once the necessary documentation or information is provided to the CCPC and the CCPC have concluded its investigations, an enterprise benefitting from the Amnesty Programme will be granted a waiver of the possible prosecution or the possible fine which would have been levied, had the anti-competitive conduct been discovered and investigated by the CCPC by their own initiative. The enterprise will be required to cease the anti-competitive conduct and desist from further abrogating the Competition Act.

Possible Risks Associated with the Amnesty Programme
The Amnesty Programme is a significant development of the CCPC. However, the CCPC has only published a press release with few details. The press release appears to suggest that the Amnesty Programme comes with a conditionality that is, it is only granted in the event that the said information provided by the enterprise is “of such quality and degree of detail that it increases the chances of proving the existence of the prohibited agreement which the Commission would ideally have not been privy to or had access to at all without investigation.”

Accordingly, it is possible that an enterprise may divulge information to the CCPC that the CCPC may not deem acceptable for purposes of granting amnesty.

The caution to businesses is to understand the parameters and attendant conditions of the programme before participating in the Amnesty Programme.