The boomerang effect of competition law
How can the latest decisions of the Competition Council be explained? First, it should be said that History does not forget anything. In addition, the competition regulator came to clear up a liability. Some explanations are needed here: First episode: the Competition Council had closed its last session in October 2013. The terms of office of its members were coming to an end. At the same time, the review of the law that has governed it since 2000 was under consideration in Parliament. Second episode: the regulator had entered a period of forced hibernation until almost the end of 2018.
Its members were not renewed, while in the meantime the new competition law was published in the Official Gazette of July 24 and August 7, 2014. Third episode: the operators were confused about economic concentration. They had the obligation to notify them in advance to the regulator. The situation was paradoxical: new law, a Board without members and legal liability of companies and their managers. “The market runs on its own…”, according to the famous formula of its former president, Abdelali Benamour.
Fourth episode: several currents have emerged in this troubled context. Some companies, like LafargeHolcim, have decided to comply with the law by notifying their operations to the Government. Before the 2014 law, the Head of Government played a role in terms of control of concentration… The other current decided to ignore the law by carrying out the deal, even if it meant taking risks, thus considering that the Government no longer had a say and that the Council is in a state of coma. A third current has opted for caution by suspending their economic concentration projects or notified such projects even if the regulator was inactive. The market and the investors had largely suffered from this institutional deadlock. The Government had a great deal of responsibility until the appointment of Driss Guerraoui and of the new members of the Council four years after the legislative reform in November 2018. Fifth episode: Clearing up this historical liability which would sooner or later reappear as we predicted ten years ago. Of course, the health crisis has turned the administration upside down and not only that. The Competition Council had organized itself to maintain the public service through digital technologies. So why have Sika AG and LSF11 Skyscraper Investments being sentenced? For not having complied with the law relating to freedom of prices and competition, although the respective deals of the two companies were entered into in December 2019, that is to say after the reactivation of the Council and before the health crisis. Law and time therefore ended up catching up with the two companies. It is the boomerang effect. What are the risks run by people who choose not to declare their transactions carried out from January 1, 2019 to the end of 2022? To take the risk of being inflicted a financial penalty, with also the collateral damage on their reputation. “Certainly, there is the five-year statute of limitations, but in the world of business everything ends up being known and the Council will do everything to detect possible fraudsters”, promises its general rapporteur. Khalid Bouayachi and his investigators acted on their own initiative in the latest case. LSF10 Flavum Holdings was fined 10.6 million MAD.
Faisal FAQUIHI
