Mozambican Competition Regulatory Authority promotes Public Consultation on the Leniency Regime

The competition legislation in force in Mozambique provides for the existence of a “leniency” mechanism in the context of investigations carried out by the Competition Regulatory Authority (CRA).

This mechanism is based on the economic theory of the prisoner’s dilemma and aims to promote the cooperation of offenders with the CRA. In return for admitting to the facts in question, the leniency applicant may be granted a reduction of up to 70% in the amount of the applicable fine.

For a competition authority such as the CRA, the advantage is to have access to evidence of illegal practices that are usually secret, and on the basis of such evidence being able to convict the other participating undertakings.

The implementation of leniency programs in the United States of America and the European Union has led to the detection and sanctioning of a large number of international cartels.

The CRA is in the process of developing its leniency regime1 and is now submitting for public consultation the corresponding detailed Draft Regulation.

Positive aspects of the Draft Regulation include the guarantee of confidentiality of the applications and the information provided by the companies requesting leniency, as well as the possibility of the application being made orally (rather than in writing).

On the other hand, the Draft Regulation reflects some shortcomings stemming from the existing law:

1. the absence of the award of a total exemption from the payment of fines to the first company to apply for leniency; and
2. the lack of a provision allowing a company to submit a hypothetical application or an application on a no-name basis.

The publication of the official version of the Leniency Regulation by the CRA is now awaited.

 

Contacts

Miguel Mendes Pereira -Partner at DLA Piper, Portugal

José Caldeira - Partner at Sal & Caldeira, Mozambique