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Panel looking into ways to improve effectiveness of competition authorities – Patel

Oct 31 2018 21:50
Lameez Omarjee, Fin24

Even strong institutions like the Competition Commission face challenges, which will be addressed by an expert panel, said Economic Development Minister Ebrahim Patel.

Patel was on Wednesday answering questions in Parliament about concerns raised about the Competition Commission.

Fin24 previously reported that the Competition Commission incurred R128m in irregular expenditure during the 2017/18 financial year. Auditor General Kimi Makwetu pointed out in the AG report that the commission exceeded its approved budget and did not follow proper tender processes.

Previous media reports have also revealed that a particular law firm – Ndzabandzaba Attorneys - has been scoring the bulk of cartel cases. DA MP Michael Cardo asked the minister if the department is doing anything in that regard, given that one of the partners of the firm was a former senior official of the commission and had earned R72m from the commission since January 2015.

Patel started off answering these questions by highlighting the commission's accomplishments. Earlier this year the commission was recognised as the agency of the year in the Asia-Pacific, Middle East & Africa at the Annual Global Competition Review Awards, he said.

Patel also said that the commission had been widely praised for the quality of its work on mergers, cartels and abuse of dominance investigations.

"There has been excellent work done by competition authorities in the past 10 years," he said.

"Even strong institutions have challenges they must address from time to time," said Patel. He explained that he had engaged with the commission on the concerns raised in media reports as well as those raised by the AG.

Patel said an expert panel has been set up to review matters relating to the effectiveness of competition authorities and the department. The outcomes of the panel should ensure that the Competition Amendment Bill, passed by the National Assembly last week, can be implemented next year. The bill will give competition authorities more power to be effective in improving economic inclusion, he explained.

The panel would be led by attorney Tebogo Malatji, and will consider the institutional matters affecting the commission as well as the Competition Tribunal.

The panel will also review the issues raised by the AG over the commission's procurement of legal and forensic resources, it will also consider the legal costs incurred to date and the use of the law firms policy. Additionally, it will consider other issues related to the commission's bottlenecks and case load

The panel will help to address issues in a way that protects the competition authorities' independence, Patel assured.

Responding specifically to the use of Ndzabandzaba Attorneys, Patel said based on the information furnished to him by the commission, the majority of cases undertaken by the firm have resulted in prosecutions and settlements by the Tribunal. These are settlements of R594m which have been successfully negotiated, and the firm has had 100% successful prosecutions in the Tribunal, he said.

The commission has been challenged in finding appropriate law firms to take on cases. "The traditional law firms in Sandton act for litigants appearing before the commission. So the commission must find law firms which are not conflicted," Patel explained.

"There are a limited number of law firms the commission can be confident in using to pursue cases," he stressed.

The commission is open to diversifying legal resources, and widen the pool of law firms which it feels are not conflicted in dealing with matters, he said.

Patel also said that the security of the commission's premises are also under threat, from those with "vested interests" which is why security services have been employed for the core staff and the premises. There is currently a security review underway, once it is completed there will be better insight on the source of the threat and efforts to undermine the commission, he told MPs.

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