Kenya strengthens ties with South Africa as the two nations step up efforts in competition enforcement

The Competition Authority of Kenya (CAK) has become a particularly proactive authority. As reported by Cliffe Dekker Hofmeyr earlier this year, the CAK concluded a cooperation agreement with the COMESA Competition Commission (CCC) as a means to coordinate with the CCC in enforcing their Competition Act. On the enforcement front, the CAK then conducted its first dawn raid in March 2016 by raiding fertiliser companies Mea Limited and Yara East Africa. The dawn raids of March 2016 demonstrate how the CAK’s capacity building over recent years has been successful and has facilitated its reputation as an active competition authority.

On 6 October 2016 the CAK’s plan to step up enforcement of anti-competitive practices was bolstered when it signed a Memoranda of Understanding (MOU) with the South African Competition Commission at the Annual Competition Law Economics and Policy Conference.

The MOU will enable the agencies to share information relating to cross-border mergers and conduct joint investigations and enforcement activities subject to their respective national laws and regulations. The MOU also reflects the authorities’ aims to increase the efficiency of investigations; increase the overall transparency of the merger review process; and increase institutional capacity by providing expert exchange programmes between the CAK and the South African Competition Commission (Commission).

Notably, the MOU provides for the exchange of non-confidential information and documents, which will allow the CAK and the Commission to conduct joint market enquiries and engage in research which will ultimately inform government policy. Co-ordinated investigations will occur in cases where similar or the same anti-competitive practices are being investigated or prosecuted by both countries.

The MOU concluded between the Commission and the CAK is ultimately part of the broader process in which the South African Competition Commission is establishing more formal relationships with other competition authorities around the world. Over the last year, the South African Competition Commission signed similar MOUs with the Federative Republic of Brazil, the Russian Federation, the Republic of India, the People’s Republic of China as well as with the Directorate-General Competition of the European Commission. On 6 June 2016 the Southern African Development Community (“SADC”) competition authorities from Malawi, Mozambique, Namibia, Botswana, Seychelles, Mauritius, South Africa, the Kingdom of Swaziland, United Republic of Tanzania, and the Republic of Zambia also concluded an MOU which will ensure cooperation between the SADC competition authorities and strengthen effective enforcement of competition law in each SADC member state.

International companies with footprints in Africa therefore need to be aware that information will be shared with the South African Competition Commission, and the Commission in turn will engage with other African authorities in pursuing anti-competitive conduct and sharing information relating to mergers. The most recent MOU between the CAK and the Commission means that for firms transacting in both Kenya and South Africa, there is a renewed need to ensure that they are competition law compliant and that transactions are notified in all African authorities where such notification is required.