Uganda’s Members of Parliament have given their approval to the Competition Bill, 2022, signaling a significant step towards fostering fair competition and regulating anti-competitive practices within the country’s markets. The legislation primarily aims to safeguard consumer interests, promote market freedoms, and address concerns related to monopolies, mergers, and market dominance. This momentous development provides a framework to curb anti-competitive behavior exhibited by firms operating in Ugandan markets.
At the core of the Competition Bill is the objective of safeguarding consumer interests and preserving market freedoms. By enacting this legislation, Uganda seeks to establish a comprehensive approach to regulating competition across various sectors, including telecommunications, electricity, insurance, banking, and energy. This progressive move will replace existing sector-specific regulations and promote a more unified and equitable competition framework.
MP Christine Lamwaka emphasized the significance of preventing mergers that could potentially diminish competition in the market, leading to the creation or reinforcement of dominant players. The bill underscores the need for meticulous scrutiny of proposed mergers, acquisitions, and joint ventures to mitigate any adverse effects on competition. Lamwaka reiterated that the objective of this law is to foster competition rather than impede it, ensuring a diverse and vibrant market landscape.
Clause 10 of the Competition Bill explicitly prohibits dominant organizations from abusing their market position. Lamwaka explained that such abuse could manifest as unfair purchase or selling prices and the imposition of unfair trading conditions, either directly or indirectly. Efforts are being made to extend the definition of a “dominant position” to include the government, effectively curbing discriminatory practices within governmental operations.
Deputy Speaker Thomas Tayebwa stressed the importance of creating a level playing field in Uganda’s markets. MPs raised concerns about the financial burden of establishing a separate tribunal to handle competition-related cases. Instead, they suggested empowering existing government bodies to effectively address such matters, ensuring a cost-effective approach to competition regulation.
The Committee on Tourism, Trade, and Industry, led by Lamwaka, recommended that the Competition Bill be applicable to all economic activities in Uganda, ensuring comprehensive regulation for economic gain. They also proposed aligning the legislation with regional agreements, such as those of the East African Community (EAC), to enhance consistency and harmonization. Additionally, the committee underscored the importance of evaluating the advantages and disadvantages of mergers to protect fair competition.
By enacting comprehensive competition regulations, Uganda demonstrates its commitment to promoting competitive pricing, supporting the growth of small businesses, and strengthening its free market economy. As the bill transitions into law, it is expected to play a pivotal role in shaping Uganda’s business landscape and fostering fair competition across various sectors. The new legislation sets the stage for a more transparent and level playing field, benefitting both businesses and consumers alike.
