University of Reading

School of Law

TITLE:

Tackling the Gaps in Competition Policy Enforcement in the three selected CARICOM Countries

Alicia Wondacey Primo

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No of Words: 13, 623 words

This is a dissertation submitted to the School of Law as part of the

requirements for the award of an LLM.

Statement of Original Authorship

I declare that I have read the notes on plagiarism including its definition and

cheating in the Postgraduate Programme Handbook and that this work is

entirely free from plagiarism. I understand the consequences of committing

plagiarism. I have acknowledged all quotations and ideas as advised in the

Handbook. Where I have been in doubt about how to acknowledge an idea or

quotation I have consulted my supervisor. Neither this piece of work nor any

part thereof has been submitted in connection with another assessment.

Signature Date

_____________________________ _________________

ALICIA WONDACEY PRIMO 6th October, 2016

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ACKNOWLEDGEMENTS

To my loving parents, Mr Courtney and Ingrid Primo and my very supportive

partner, Samuel Cunnigham words cannot express the gratitude I owe to you

for your support to me throughout my academic career. It is my greatest hope

that one day you all will reap fully the fruits of labour you have instilled in

me.

Special thanks to my supervisor Dr Despoina Matzani and proposal project

supervisor Dr Jorge Guira both of the University of Reading for your words of

advice and useful input that steered me in the right direction as I began to

develop this dissertation.

I would like to say a special thank you to my classmate Dr Josiah De Gershon

De Graft Quansah who provided useful advice to me throughout my studies at

the University of Reading. Josiah, you are my biggest inspiration.

Finally, I would like to thank the British High Commission of Guyana for

awarding me a Chevening1 Scholarship for the period 2015/2016 and making

it possible for me to produce this intellectual piece of work.

THANK YOU ALL!

TABLE OF CONTENTS1 Chevening Scholarships, the UK government’s global scholarship programme, funded by the Foreign and Commonwealth Office (FCO) and partner organisations.

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Title of Dissertation...........................................................................................1

Statement of Original Authorship......................................................................2

Acknowledgements.............................................................................................3

Table of Contents...............................................................................................4

Abstract...........................................................................................................5-8

Methodology......................................................................................................9

Abbreviations..............................................................................................10-11

Introduction.................................................................................................12-14

Chapter 1 Competition Protection under the European

Union...................................................................................15-20

Chapter 2 Transmission of Competition Policy to the Caribbean

Community..........................................................................21-27

Chapter 3 Engineering of NCAs to enforce Competition Laws...........28-36

Chapter 4 Gaps in the Transmission of Competition Laws to the

Caribbean Community........................................................37-50

Chapter 5 Gaps in the Engineering of NCAs for

Caribbean Community........................................................51-56

Chapter 6 Remedying the Gaps...........................................................57-64

Conclusion ....................................................................................65

Bibliography .................................................................................66-69

Appendices ......................................................................................70

Appendix 1: Map of Caribbean Community ................................................71

ABSTRACT

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Market failure and the collapse of competition is the most likely result if

countries do not pass competition laws to prohibit the anti-competitive

conduct of businesses.2 Competition law has been enacted since it creates a

level playing field upon which businesses can compete and competition

countries show significant growth in the level of gross domestic product

(GDP), The level of total factor productivity (which is used to measure

competitiveness in countries) has also shown massive increases.3

In the EU, competition laws evolved as a way to safeguard the single

European community market by protecting free competition in trade in goods

and services. Ultimately the EU has developed an extensive competition law

regime of a range of offences. Member states of CARICOM implemented the

Revised Treaty of Chaguaramas (RTC) and more specifically the CARICOM

Competition Commission (CCC) to deal with competition concerns of the

Region. Chapter VIII within the RTC identified the CARICOM Competition

Commission as responsible for protecting cross-border competition complaints

and the National Competition Authorities of members’ states to enforce

competition claims within their jurisdiction.4

This essay will discuss the gaps in the development of a regional competition

policy for the Caribbean Community namely gaps in the transmission of the

law to the RTC and national legislation and shortcomings in the engineering of

NCAs to enforce competition policy.

2 Taimoon Stewart, ‘The Role of Competition Policy in Regional Integration: The case of the Caribbean Community’ Salies UWI 2 <https://sta.uwi.edu/salises/workshop/papers/tstewart.pdf> accessed 1October 2016, 2 3 ibid 4 Maher Dabbah, International and Comparative Competition Law (1st Cambridge University Press 2010) 400

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On the shortcomings of the transfer of competition policy to the RTC, that will

be discussed is the fact that the CCC does not have decisional autonomy.

Decisions to conduct investigations are based on a request of a member state

or a request through the Caribbean Council for Trade and Development

(COTED).5 Further, the Commission only has ‘Proprio Motu’ powers after

asking an NCA to undertake a preliminary examination and not being satisfied

with the outcomes of its application to that member state.6 Gaps in the

national legislation of the Region arise for example, on the other hand,

because there are limited competition law offences that have been prescribed.

Of the three jurisdictions that will be discussed only one has provisions

concerning the control of merger control, but no country, however, has made

provisions for the allocation of illegal state aid.

On the engineering of National Competition Authorities (NCAs) in the

Caribbean Community, we see possible shortcomings in their enforcement as

a result of the traditional model followed by most agencies. The European

Union (EU) is a seminal jurisdiction that follows the traditional model, and it

has been subject to a variety of human rights concerns. Moreover, the structure

of many agencies are linked to other ministries or salaries are equated to that

of the public service which additionally causes other gaps.

Authors such as Maher Dabbah, Arlen Duke, and Taimoon Stewart have all

written on these topical issues as such their writings will we considered in

these discussions.

5 RTC Article 175 (1) and (2) 6 RTC Article 176 (1) and (3) RTC

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There are a variety of ways to remedy the gaps faced by the Region. Member

states can choose to revisit the lack of decisional autonomy of the CCC in the

RTC towards a more supranational approach as in the EU. Member states can

begin to expand their range of competition offences to include merger control

and illegal state aid.

On the other hand, the engineering and structure of NCAs could also be

revisited. To safeguard effective enforcement of competition policy, there

needs to be autonomy of an agency from government ministries, no mixing of

investigative from adjudicative roles in the structure of agency and a revamp

in the setting of salaries at the same level of workers in public service

ministries in the Region, among other solutions. Moreover, solutions will also

be discussed on how agencies can become more effective by marketing an

effective brand, ensuring that the public is kept up to date with the activities of

the commission.

Additionally, in solving issues such as the low enforcement of international

cartels, political influence as a result of lack of autonomy, training, and

technical assistance, authors Michal Gal and Taimoon Stewart suggest the

implementation of Joint Enforcement and Advocacy Agreements or

cooperation agreements among member states.

Additionally, solutions to the gaps can also be learned from the EU. In the EU,

the Directorate-General of the European Commission has broad powers in the

detection and investigation of competitor cases, such as provisions for surprise

inspections (or dawn raids). Moreover, there are limits to judicial review

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when a decision of the European Commission is appealed since courts are

usually constrained to the legality of decisions, not merits.

Finally, the researcher will seek to propose as another solution of a regional

effort for consolidated guidelines on investigating competition cases. These

guidelines to be adopted by the CCC will seek to guideline NCAs on

recommended procedures for the Complaint phase, Investigative Phase,

Hearing Phase and Adjudication Phase of investigations.

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METHODOLOGY

The researcher has employed the primary research methodology of a critical

legal analysis as she examines gaps of the transmission of competition policy

to local legislation and engineering of NCAs within the region.

With the aid of journal articles and textbook written by learned authors on

competition policy and case law reviews of decisions emanating from the

CCC, national competition commissions in Guyana, Jamaica, and Barbados

the researcher aims to reinforce her conclusions. However, due to the recent

nature of the Caribbean Community’s competition law policy, only a few

cases were able to be gathered and thus examined.

The enforcements systems in the Caribbean Community and the European

Community would be primarily examined since competition policy in the

region emanates from the EU.

The researcher would additionally from her personal experiences as Legal

Officer of the Competition and Consumer Affairs Commission (CCAC) of

Guyana and with the help of selected case studies in this jurisdiction, examine

various competition issues.

It should be noted that the implications of the highlighted gaps for the NCAs

and the parties involved will additionally be analysed. Moreover, finally, the

research would conclude with possible solutions to remedy the shortcoming

highlighted in this paper.

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LIST OF ABBREVIATIONS

CARICOM- Caribbean Community

CCAC- Competition and Consumer Affairs Commission (Guyana)

CCC- CARICOM Competition Commission

CCJ- Caribbean Court of Justice

COTED- Caribbean Council of Trade and Development

CFTA- Competition and Fair Trading Act

CSME- Caribbean Single Market and Economy

DoJ- Department of Justice

ECN- European Competition Network

ECNHR- European Convention for the Protection of Human Rights and

Fundamental Freedoms

EU- European Union

EEU- European Economic Community

ENQUIRY- Full investigation of the CCC

FCA- Fair Trading Commission

NCA- National Competition Authority

OECD- Organisation for Economic Cooperation and Development

RoP- Rules of Procedures

RTC- Revised Treaty of Chaguramus

RJCAS- Regional Competition Law Agreements on Joint Enforcement and

Advocacy Agreements

SMEs- Small and Medium Sized Enterprise

TFEU- Treaty of the Functioning European Union

UNCTAD- United Council for Trade and Development

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VABER- Vertical Agreement Block Exemption Regulations

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INTRODUCTION

1.0 Why is Competition Policy Important?

Competition law regulates competition on a market by prohibiting anti-

competitive conduct of companies. The reason why countries around the

world are eager to enact competition law legislation is due to the benefits of a

productive/ growing economy and level playing field that market players must

comply with, which guarantees competition. 7

A productive economy is created since inefficient and over priced

monopolistic companies are ‘weeded out’ of the market and replaced by

efficient firms offering lower prices and better quality goods and services. 8

Moreover, for existing businesses to compete on the market, this must

innovate and create new products, offer more variety or do an overall

restructuring of business activities to continually and profitably compete on

the market.9

Another profound benefit of competition policy is the creation of a level

playing field. Firms competing in a market must all uphold competition policy

rules such as not to abuse their dominant position or engage in anti-

competitive agreements. Thus companies will be able to capitalise a market

on their merit, not improper behaviour or tactics.

If competition laws did not exist, dominant companies would operate to

maximise profits with little consideration to consumers and improving goods

7 Lowe, Phillip etal, ‘Modernization and Beyond: The Role of Competition Policy in Driving Economic Growth’ (2005) European Competition Journal <http://www.tandfonline.com/doi/pdf/10.5235/ecj.v1n1.> accessed 1st October, 2016 , 368 ibid9 ibid

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and service they are producing. Thus competition legislation keeps the cycle

of continuous innovation alive, with the constant challenging of existing high-

profit companies. 10This innovation cycle of creating new products (of an

existing firm) is additionally further shortened to a quicker time frame, to

compete in the race with other innovators for state of the art products.11

1.1 Main Importance within the Caribbean Community

In 2001 the Caribbean Community began implementing its competition policy

through the RTC. Before the RTC came into effect in 2001, the Treaty of

Chaguaramas became operational in 1973, and Caribbean Single Market and

Economy (CSME) was implemented to promote a single market by

eliminating all tariff barriers within the Region.12 However, one of the results

that occurred, with the removal of trade barriers, was that both enterprises on

the market both public and private began to allocate markets among each other

(so as to safeguard for example an existing market player’s territory) or

formulate anticompetitive agreements such as price fixing.13 Member states of

CARICOM therefore formulated its policy on competition protection and

appointed CARICOM Competition Commission (CCC) to deal with cross-

border competition concerns of the Region.14 It can therefore be asserted that

competition policy goals are to create a single market and ensure that goods

and service are integrated regionally, in keeping with the objectives of the

CSME.15

10 Lowe (n7) 3611 Ibid 3712 Stewart (n 1) 213 ibid14 Dabbah (n 3) 40015 RTC Article 169

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Taimoon Stewart observes that if two regional competing petroleum firms in

Trinidad and Barbados engaged in anticompetitive conduct, it could affect that

relevant market for two or more countries.16 Stewart, therefore, asserts that the

likelihood of dangers is real for CARICOM to be susceptible to

anticompetitive conduct of large firms.17 Stewart suggests that territories have

changed their products of export to combat the erosion of preferential markets;

however, globalisation and the international integration of goods have made it

hard for the region to compete.18 In the advent of globalisation, it is, therefore,

submitted that it is imperative that countries within the region integrate.

1.2 Why the three selected Countries?

This paper will discuss competition policy as it relates to three CARICOM

countries namely Jamaica, Barbados and Guyana. This selection was done

mainly because within the Region these jurisdictions have been able to

establish full functioning competition agencies that complement the work of

the CARICOM Competition Commission. Other jurisdictions such a Trinidad

and Tobago have competition legislation, but its NCA has not been able to

become fully functioning.

Before we can consider the depth of competition offences that were

transmitted to the region it is worthwhile to consider, the reason for its

development in the EU and the ranged of offences the EU caters for due to the

similarities in the wording of the law in the Caribbean Community.

16 Taimoon Stewart, ‘Regional Integration in the Caribbean: The Role of Caribbean Policy’ (ed), Competition Policy & Regional Integration in Developing Countries (Edward Elgar Publishing Limited 2012) 16517 ibid 16118 ibid 165

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CHAPTER 1

2.0 Competition Policy under European Union

With the formation of the European Community in 1957 (or Treaty of Rome)

and the creation of a single European Community market, it became

imperative for competition policy to safeguard the market from the

establishment of trade barriers and to ensure free competition in trade.19 The

main features of European Community Competition Rules emerged as being

to restrict anticompetitive conduct that impedes restricts or distorts

competition.20 The EU adopted the TFEU in order to guarantee fairness on the

single market when trading; the TFEU prohibits competition offenses, under

Articles 101, 102 (formerly Article 81 and 82) for anti-competitive agreements

and abuse of a dominant position respectively. Illegal state aid is regulated

under Article 107 and 108 of the TFEU. Merger control is regulated under

Merger Regulation 139/2004 for mergers that have a community dimension

and sets out the procedures wherein concentrations between undertakings are

subject to the approval by the European Commission. Under Article 105 of the

TFEU, the European Commission, and the national competition authorities are

the regulators that are empowered with extensive investigative powers. The

European Commission and NCAs, have investigative powers under Article

101 and 102 offenses are further elaborated in Regulation 1/2003. Regulation

1/2003, additionally, in essence, gives member states the authority to

determine which body will enforce Article 101 and 102, after which powers

are conferred on that requisite body.

19 Willy Schlieder, ‘ European Competition Policy,’ (1981) 50 Antitrust Law Journal <http://www.jstor.org/stable/pdf/40842674.pdf> accessed 1st October, 2016, 64920 ibid

15

It should be noted that enforcement by the European Commission is preferred

over NCAs in some key situations. These include cases where the (i) three

member states are affected by the anticompetitive behaviour in a relevant

market. (ii) Because of its close links to EU rules, the EU Commission will be

more efficient. (iii) There is insufficient policy in the area, and a Commission

decision is needed to develop policy and (iv) the Commission will be the most

effective at enforcing competition rules.21

2.1 TFEU enforced by NCAs and European Commission

As discussed competition offences in the EU are provided in the TFEU and

Merger Regulation 139/2004 EC. This section will examine these offences in

detail to compare the depth of offences that are catered for in developed

regions such as the EU, to consider whether any of the offences/regulations

may apply to the Caribbean’s reality.

2.3 Enforcement of Anti-competitive agreements

Article 101 of the TFEU prohibits restrictive agreements between independent

firms. Agreements are horizontal if they are among competitors and vertical if

they are between manufacturer and distributor, so long as a horizontal or

vertical agreement is restrictive it is prohibited under Article 10122. Moreover,

decisions by associations and concerted practices are also prohibited. 23In

proving an offense under Article 101 that agreement must have the ‘object or

effect’ of distorting competition within the common market of the EU.Further,

21 Slaughter and May, ‘Overview of Competition rule’ <https://www.slaughterandmay.com/media/64569/an-overview-of-the-eu-competition-rules.pdf> accessed 20th September, 201622 Richard Whish, Competition Law (8th edition Oxford University Press 2015) 8423 ibid

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the effect must be ‘appreciable’ on competition and trade between member

states.24

2.4 Exemptions/Exclusions for 101

Article 101 (3) of TFEU is the legal exemption to offenses under Article 101 if

consumers benefit from the improved production of the good or service or

there is a nurturing of ‘technical or economic’ progress. Further, the

agreement must not contain restrictions that could prevent firms from meeting

the above exemption or have any the likelihood of eliminating competition to

a substantial amount of the products.25 Additionally, agreement, decision or

concerted practice qualifies to be exempted where it fits the criteria set out in

the Vertical Block Exemption Regulation VABER (discussed below) or if an

individual exemption is granted the following notification by the European

Commission.26

2.5 Enforcement of Abuse of Dominance

Article 102 of the TFEU prohibits abuses by independent firms of a dominant

position that within/substantial part of the internal market. These dominant

companies may engage in unilateral abusive conduct that is exploitative or

exclusionary. Exploitative conduct such unfair and excessive pricing whereas

exclusionary conduct may be exclusive dealing, tying and bundling, predation

and refusal to supply.27 Overall the result of these practices is that trade would

be affected between member states.

2.6 Enforcement of State Aid

24 Whish (n 22) 15425 ibid 158; Article 101 (3)26 Whish (n 22)17827 ibid 213-214

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State aid connotes the granting of an advantage (something not attainable in

open market) to an undertaking (engaged in economic activity) that has the

potential to distort competition and trade in the EU.28 Article 107 and 108 of

the TFEU are the requisite provisions which monitors state aid. Since state aid

distorts or threatens to distort competition and affect trade between member

states, the European Commission has investigative authority.29 In some

circumstances, State aid will nevertheless be permissible because they

promote legitimate objectives in a proportionate manner. Article 107 (2) and

(3) TFEU, therefore, lists the instances where aid is considered acceptable.

However, all other forms of aid that undermine, the objectives of the Treaty

rules on competition, is prohibited.

2.7 Enforcement of Merger Control Regulation

Council Regulation 139/2004 (EUMR) regulates and controls concentrations.

For this to apply there must be a concentration (between two or more

‘undertakings’) and the turnover of each undertaking must be within the

specifics of the regulation.30 The substantive test of whether a concentration

ought to be controlled turns on whether it impedes competition.31 For

concentrations lacking an EU dimension they ought to be investigated by

NCAs, and exceptions to this general rule occurs where parties engage in pre-

notification contracts with the authorities to reallocate jurisdiction to the

Commission or between NCAs. 32Moreover, for concentrations with an EU

28 Sandra Colino, Competition Law of the EU and UK, (7th Oxford University Press 2011) 41329 ibid 41730 ibid 36031 Whish (n 22) 87332 ibid

18

Dimension member states can additionally apply their local laws, in limited

circumstances.33

Procedures/Guidelines Adopted

The EU legal regime contains numerous procedures, guidelines, and notices

for enforcement of the competition offenses listed above. It is beyond the

scope of this dissertation to discuss all of these accompanying rules. What the

researcher, however, would like to discuss, however, is the Block Exemption

Regulation for Vertical Agreements (VABER) under Article 101 of the TFEU

and the Guidelines for Enforcement Priorities of Article 102 offenses; due to

its relevance to the Caribbean Community that will be discussed later.

With respect to, the Regulation 330/2010 (VABER), vertical agreements that

satisfy certain conditions are guaranteed the protection of the VABER

irrespective of whether they produce a positive or negative effect.34 If the

vertical agreement however, is incompatible with the Article 101 (3)

exemption criteria then it is not covered and therefore infringes Article 101 (1)

as a hardcore restriction e.g. price fixing and resale price

maintenance.35Additionally, the Commission’s Notice on Guidelines on

Vertical Restraints sets out principles for determining whether a vertical

agreement fits under Article 101 of the TFEU. The guideline, therefore, lists

the type of agreements that are not covered which include (i) Agreements of

minor importance and SMEs (ii) Agency Agreements (iii) Subcontracting

agreements. 36

33 Whish (n 22) 87334 Colino (n 28) 20835 ibid 20836 Colino (n 28) 208

19

The Commission Notice on the Enforcement of Priorities (that was mentioned

earlier) applies to Article 102. Accordingly, two forms of conduct impinge on

Article 102 namely conduct that is exclusionary which causes a foreclosure

effect of market players and conduct that is exploitative for example

excessively high prices or other behaviours that undermine the internal

market.37 The Commission therefore in the Guidance lists as a priority for

enforcement exclusionary conduct. Article 102 applies where an undertaking

abuses its dominant position in a market (single dominance) and where there is

more than one undertaking it is considered collective dominance. 38 It should

be noted that this ‘Guidance’ is not obligatory on the European Commission or

NCAs.

Having discussed how EU formulated its competition regime, the research

would now consider how competition policy was formulated in the Caribbean

Community.

CHAPTER 2

3.0 Transmission of Competition Policy to the Caribbean Community

37 ibid38 ibid 293

20

The Caribbean comprises of countries that border the Caribbean Sea.

CARICOM (Caribbean Community) is an organisation that consists of 15

countries within the Caribbean community including Guyana, Belize,

Suriname (former Dutch colony) and Haiti (former French colony) See

Appendix 1 for a map of the Region. The member states of CARICOM have

joined more than 100 states around the world in enacting competition

legislation.

As discussed earlier, the RTC of the Caribbean Community, seeks to ensure

that the objectives of the CSME namely regional integration by implementing

a single market free of barriers to trade in goods. Thus, sections of the RTC

now ensures that enterprises both public and private cannot frustrate the

CSME by anti-competitive business conduct such as dividing up the market,

price fixing, predatory pricing, etc. As mentioned earlier, the RTC names the

CCC as the principal agency responsible for enforcing cross-border abuses.

What is evident in the CCC is the lack of decisional autonomy.

An agency is considered to have supranational authority if it can make its

decisions independently, has institutionally autonomy, and the laws of the

organisation have binding effect. 39In essence, that agency is capable of having

authoritative powers over member states.40 In identifying whether an agency

has supranational authority, consideration needs to be given to the legal

personality (or actual attribution of rights in the treaty) of the organisation.41

Article 174 of the RTC lists the intervention powers of the CCC as being:39 Fagbayibo B, ‘Common Problems Affecting Supranational Attempts In Africa: An Analytical Overview’, (2013) 16 (1) Potchefstookm Electronic Journal < http://www.nwu.ac.za/sites/www.nwu.ac.za/files/files/p-per/issuepages/2013volume16no1/2013%2816%291FagbayiboDOC.pdf> accessed 1st October, 2016, 3340 Fagbayibo (n 39) 3341 ibid

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‘Subject to Article 175 and 176 the Commission may in respect of

cross-border transactions, or transactions with cross-border effects

monitor investigate, detect, make determinations or take action to

inhibit and penalise enterprises whose business conduct prejudices

trade or prevents, restricts or distorts competition within the CSME.’

Thus it is clear that its role of the CCC is essential to investigate cases that are

cross-border in nature and make determinations. For the CCC to act, however,

Member state can file either a complaint to the CCC (about a cross-border

effect or practice in another member state) or petition their member state to

make a recommendation to Caribbean Council of Trade and Development

(COTED) to engage the CCC. 42 The CCC is additionally given the powers to

investigate a case only after it has requested an investigation by a member

state and that member state’s investigation was unfavourable.43 Thus it is clear

that the CCC does not have decisional autonomy to decide when and if to

investigate in competition matters. In the Caribbean Community, a member

state is expected first to investigate and determine an infringement based on its

own competition legislation ( produce a preliminary report) and thereafter

refer it to the CCC if it involves cross-border issues; this lack of supranational

powers of the CCC is to ensure member states maintain the sovereignty of

enforcement in competition matters.

As was mentioned, in the UK, Both the European Commission and NCAs

have the authority to apply Articles 101 of 102. In particular, cases, as was

noted, application to the European Commission is preferred to NCAs.44 These

42 Article 175 RTC43 Article 176 RTC44 Slaughter and May (n 21)

22

situations include where three member states are involved in the relevant

market or (ii) the agreement would be better served being applied to the EU

Commission given its close links to EU rules.45

3.1 Specific Competition Offenses mentioned in RTC

Under the RTC, Article 177 (2) regulates anti-competitive business conduct

which includes activities such as indirect or direct fixing of selling prices,

predatory pricing, price discrimination, loyalty discounts or concessions, etc.

Article 179 (1) regulates the abuse of dominant position by prohibiting

activities that restrict entry of an enterprise or deters an enterprise competing

on the market or eliminates an enterprise from the market among others. For

any of the activities mentioned above to be in violation of the RTC they must

significantly inhibit regional integration and the creation of a single market

contrary to the objectives of CSME. Article 181 is the De Minimis Rules that

prescribes that the Commission may exempt from the provisions business

conduct that has minimal impact on the objectives of CSME. It should be

noted that merger control regulations or state aid are not mentioned in the

RTC.

Since the RTC caters for two main competition offences namely

anticompetitive agreements and abuse of dominance, below we will examine

how this transcends to competition legislations in local member states.

3.2 Legislative Protection afforded to NCAs in Caribbean Community

45 ibid

23

As mentioned, three jurisdictions have full functioning competition

commissions; these include Barbados46, Jamaica47, and Guyana.48 This section

will focus on the competition protection in the legislations in these territories.

3.2.1 Barbados

The Barbados Fair Trading Commission, which operates under the Fair

Trading Commission Act (FCA) CAP 326B and 326C among other acts,

regulates competition policy enforcement. According to section 4(1) of The

Fair Trading Commission Act of 2002, the functions of the Barbados Fair

Trading Commission is to enforce fair competition along with consumer

protection and the Utilities Regulation Act.

Part III of the Fair Competition Act CAP 326C prohibits the offences of anti-

competitive agreements, abuse of a dominant position, mergers and

interlocking directorships. Section 13(3) prohibits anti-competitive agreements

that fall under the specific subsections listed. Similarly, section 16 (3) sets out

the subsections for abuse of a dominant position. Merger control is regulated

under section 20 of the FCA CAP 326C. State aid is not yet regulated.

3.2.2 Jamaica

The Jamaica Fair Competition Act (FCA) of 1993 prohibits anti-competitive

behaviour more specifically, agreements that lessen or distorts competition

and the abuse of a dominant position by monopolistic companies. Section 17

(2) and section 20 of the FCA of Jamaica which deals with anticompetitive

agreements and abuse of a dominant position, respectively, are very similar to

46 Barbados Fair Trading Commission47 Jamaica Fair Trading Commission48 Competition and Consumer Affairs Commission of Guyana

24

13 (3) and 16 (3) of Barbados FCA. Like Barbados, we see the similarity in

the anti-competitive abuses that are listed in the Act namely resale price

maintenance, tied selling, price fixing, collusion and cartel and bid-rigging.

There are no prohibitions to mergers and state aid in the FCA of Jamaica.

3.2.3 Guyana

The Competition and Fair Trading Act (CFTA) of 2006 prohibits anti-

competitive abuses. According to section 6 (1) of the CFTA of 2006, the

CCAC can commence an investigation (either on its own accord or a person)

into matters that offence the Act. In examining its provisions on competition

enforcements for anticompetitive agreements and abuse of a dominant

position, it can be observed that section 20 (2) and 24 (1) of the CFTA is

similar to sections above 13 (3) and 16 (3) of the FCA of Barbados

(aforementioned). Guyana like Jamaica has not adopted provisions on mergers

and state aid.

3.2.4 Exemptions and Exclusions

Anticompetitive agreements and firms engaged in abuse of dominance

practice may be exempted. Section 20 (2) and 24 (3) of CFTA of Guyana

states that (for anticompetitive agreements and abuse of dominant position) if

there is a resulting benefit to consumers namely they benefit from

improvements in the production of goods or services, or additionally the

practice gives rise to technical or economic progress. Similarly, exemption

provisions for anticompetitive agreements and abuse of dominance are found

in Jamaica and Barbados.49

49 Section 17 (4) and 20 (2) of the FCA of Jamaica and 13 (4) and 16 (4) of the FCA of Barbados.

25

Similarity of Wording/ Law

It should be noted that as a result of Caribbean Community law being based on

EU competition law, there are similarities in the wording of the law. Phrases

such as ‘agreements which have the effect of preventing, restricting or

distorting competition are void,’50 ‘directly or indirectly fix purchase of selling

prices’51and ‘improving the production or distribution of goods and service’

52are all found throughout the three jurisdictions.

3.2.5 Rules of Procedures adopted by CCC

In 2011 the CARICOM Competition Commission adopted its Rules of

Procedure (RoP) 53 for competition enforcement, but this has not been

modelled by National Competition Authorities since they lack formally

adopted rules. From the CCC’s RoP, we see a clear outline in how a matter is

to be dealt with by the CCC. Thus, the Secretariat investigates a complaint and

produces an Investigating Panel Report. This Report is then issued through the

Executive Director of the CCC to the Adjudicating Panel for an Enquiry.54

This Adjudicating Panel is empowered under Regulation 36 to hold hearings

by certain specified written procedures. After the Adjudicating Panel is

satisfied, it shall adjourn a hearing to consider its decisions which will

comprise of the entirety of evidence for consideration.55

50 Section 20 (1) (b) of the CFTA of Guyana51 Section 13 CAP 326 C of Barbados52 Section 17 (4) (a) (i) of the FCA of Jamaica53 CARICOM Competition Commission, Rules of Procedure Report (2011) < http://www.caricomcompetitioncommission.com/images/registry/CCC-Rules-of-Procedure-2011.pdf> accessed 1 October, 201654 The term Enquiry is used to denote the fully investigation55 CCC RoP (n 50)

26

As a result of the RoP of the CCC, the CCC can effectively conduct

investigations and request participation by parties at the Enquiry stage of an

investigation. In the Case of Trinidad Cement Limited (TCL) v CCC56, in

considering whether the rights of TCL were infringed at the investigation

stage, the CCJ held that the Commission in conducting its investigation under

Article 174 (2) had not prejudiced TCL. From the evidence, TCL was only

aware of the investigation at the Enquiry stage. However, TCL could not

produce evidence in court that its participation in the enquiry was impaired

and therefore could not establish a full defence. Thus TCL has not established

any prejudicial acts of the Commission.57 Moreover, TCL also alleged that the

CCC failed to disclose documents relevant to the case at hand namely the fact

that the resolution that occurred at the Twenty-Sixth (26 th) Meeting of COTED

was not in keeping with Article 175 (2). The CCJ held that all the evidence

and information about the case was available the Claimant for him to use at

the trial thus the TCL cannot claim unfairness and non-disclosure.58

After competition laws had been adopted, the Region had to decide how each

NCA within the Region should operate and function in the enforcement of its

duties. The following Chapter will, therefore, discuss the engineering of

NCAs.

CHAPTER 3

4.0 Engineering of NCAs to Enforce Competition Laws

56 Trinidad Cement Limited (TCL) v CARICOM Competition Commission (2012) Original Jurisdiction Application No. OA 1,57 ibid para 2758 ibid para 43

27

In determining whether NCAs were indeed engineered to operate effectively

and regulate the offences listed in the above sections, an examination of the

autonomy and the overall structure of NCAs will be explored.

4.1 Independence

For an agency to be autonomous, it must be free from government influence.

The operational structure of Guyana, Barbados and Jamaica depicts

competition authorities of the above countries operating as an agency within a

government ministry. In Guyana, the Competition and Consumer Affairs

Commission is an agency of the Ministry of Business, Barbados- the Ministry

of Industry, International Business, Commerce and Small Business

Development and in Jamaica- the Ministry of Industry, Commerce,

Agriculture and Fisheries. Thus, the projection to the public that NCAs in the

Region operate independently from influences from government ministers is

necessary. Author Dabbah raises the issue that many competition agencies in

developing countries ‘have bite but no teeth’ in conducting investigations.

Dabbah asserts that competition authorities may lack independence to carry

out the work and reach final conclusions because the law may reserve

considerable powers to the relevant ministry and minister who plays a key role

in the regime and who enjoys executive powers over the work of the

competition authority and decision maker in actual cases.59

4.2 Overall Structure

In considering the effectiveness of the overall structure the researcher will

discuss the importance in the composition and structure of NCAs, whether

59 Dabbah (n 9) 315

28

NCAs are standalone or joint enforcement agency, there is a multiplicity of

purposes for the NCAs and the effectiveness of the remedies that have been

earmarked.

4.2.1 Composition and structure

In considering the composition and structure of the body of competition

authorities within the Region, we see that by section 1 (1) of the First

Schedule of the CFTA, the Body of Commissioners shall consist of members

from the private sector, legal profession and consumer affairs. Thus given the

likelihood that the body of Commissioners may be high ranking officials of

society, it is pertinent to ensure that Commissioners have adequate time to

serve effectively as members of the Commission. Dabbah observes that the

composition of competition authorities may comprise of high ranking

individuals who may be unable to give competition cases the necessary focus

and attention it needs, as such competition policy issues may be side-lined and

overshadowed by non-competition matters.60 Thirdly, the work of the

commission may not be sufficiently constant to lead to effective enforcement

of competition rules; the meetings which the competition authority is supposed

to hold may not be sufficiently frequent to enable effective competition law

enforcement and robust competition policy to take a foothold in the country

concerned. 61 Finally, Dabbah observes that in some countries, there is a

practice of ‘doubling’ officials which mean that those who handle the work of

the competition authority is also related to work within other government

60 Dabbah (n 9) 31561 ibid

29

agencies, often the Ministry of Trade and Industry. Inevitably, the chances for

effective enforcement are overstretched and less productive.62

4.2.2 Joint/Standalone Agency

Having discussed in the previous Chapters on the legislative powers entrusted

to NCAs in the Region, it is clear that the legislation makes NCAs distinct

without the obligation for joint enforcement with other enforcement bodies/

NCAs. NCAs, as mentioned, are only expected to cooperate with the CCC in

matters concerning cross-border disputes. Thus this agency structure allows

NCAs to respond to new developments ‘on the spot’ without ‘going up the

ladder’ and getting approvals for decision. Effective coordination with other

departments within the agency will also be easy since it is one enforcement

body.

However, it should be noted that other agency models, allow for collaboration

between many enforcement bodies such as in the US, with collaborations

between Federal Trade Commission (FTC) and the Department of Justice

(DoJ) Antitrust Division shared authority on Mergers. 63 Muti agency

enforcement partnerships, on the other hand, serves as a guarantee that a

competition complaint would be investigated notwithstanding such national

issues such as resource constraints both human and financial, corruption such

as ministerial influences at NCAs, political power, etc. 64

4.2.3 Single and Multiple Purpose

62 Dabbah (n 9) 31563 William Kovacic etal, ‘Competition Agency Design: What’s on the Menu,’ (2012) 8:3 European Competition Journal <http://www.tandfonline.com/doi/pdf/10.5235/ECJ.8.3.527?needAccess=true> accessed 1st October 2016, 53264 Kovacic ( n 63 ) 532

30

Another factor in the effectiveness of NCAs stems from the multiplicity of

functions/ purpose of the NCAs. Most competition agencies often engage in a

multiplicity of duties in addition to competition protection. A single use

agenda benefits NCA since it can clearly establish its institutional brand.65

From the three jurisdictions studied in this paper, it is clear that only Jamaica’s

NCA operate for the sole purpose of competition protection. In Guyana, the

CCAC has coupled its competition enforcement with consumer protection. In

Barbados, competition policy is enforced in addition to consumer complaints,

and utility claims.

4.2.4 Remedies

The effectiveness of an NCA also turns on the penalties it imposes. In the

previous Chapter, we have discussed the penalties for various competition law

offences with NCA in the Caribbean Community. According to Kovacic if

competition agencies have a combination of criminal and civil penalties, it

portrays NCAs as credible to deter enterprises from violating competition

laws. 66From the three jurisdictions that have been discussed in this essay, we

see that all three of NCAs have harsh penalties for competition violations.

In addition to the factors of autonomy and overall structure; an NCA’s

effectiveness also depends on the model it chooses to follow.

4.1 Traditional Administrative Model v Prosecutorial Model

65 William (n 62) 53366 ibid 534

31

NCAs through its national competition law legislation may choose to adopt

either the traditional or prosecutorial model in its enforcement of competition

laws. The traditional administrative model can be found in the European

Commission where investigative and adjudicative powers are vested in a

single agency. After a matter is adjudicated on by the European Commission,

parties have a right to challenge the agency’s decision in the courts.67 Earlier

we mentioned that the European Commission has the power to enforce Article

101 and 102 from Regulation 1/2003 but exactly how does European

Commission operate?

Within the European Commission, the Directorate-General for Competition

has the responsibility to investigate and formulate a preliminary opinion for

breaches of EU Competition laws.68 Investigations of potential competition

law violations are allocated to a particular Directorate within the European

Commission and to be appointed a case team.69 If investigations uncover a

possible breach, the Commission has the power to file a ‘Statement of

Objections’ which describes the conduct and outlines the Commission’s

preliminary assessment of that conduct.70 If the preliminary assessment

suggests that a breach has occurred, the parties can choose to settle by giving

an ‘undertaking,’71 however, if no ‘undertaking’ is given, a hearing officer

would commence a hearing. After the hearing the DG Competition drafts a

preliminary decision that is vetted by the Commission’s lawyers and presented

to the body of Commissioners who decides whether to adopt the DG

67 Arlen Duke, ‘Public Enforcement’ in John Duns and Brendan Sweeney (ed.), Comparative Competition Law (1st edition Edward Elgar Publishing Limited 2015 ) 27268 ibid 27369 ibid 27270 ibid71 ibid

32

Competition regulations.72 The Commission’s decisions are, therefore, binding

on companies or individuals to whom it is addressed. However, third parties

with a particular interest in the matter or a firm found to have breached the

laws can appeal to a General Court on both legal and factual grounds.73 Thus it

can be established that the Commission is empowered to investigate, enforce

and punish an offending party. Adjudication is not separated to be a function

performed only by the body of Commissioners since the DG Competition

submits a preliminary decision on the matter to the Commissioners only for

ratification.

On the other hand, the prosecutorial model enforcement agency comprises of

an executive body charged with the task of investigating and prosecuting

suspected breaches of the law. Adjudication is separated and pronounced by

either a general court or specialist tribunal. Thus the agency focuses on the

prosecution of the offending party and leaves the decision-making powers to

an expert/specialist tribunal or generalist court. Many agencies usually prefer a

specialist court.74An example of this model is the US Department of Justice

(DoJ) that can open and conduct investigations. The DoJ lacks any powers to

impose sanctions. In imposing sanctions of a suspected breach of US antitrust

rules, a civil or criminal suit is brought by the Federal District Court. The

decisions of the Federal District Court is appealable only to the Court of

Appeal (District).75

Below we would consider the specific model that is followed in the Caribbean

community.

72 Duke (n66) 27273 ibid 27474 ibid75 ibid 275

33

4.2 Specific Models Followed by Caribbean Community

Guyana

In Guyana, it is evident that enforcement of competition offences through the

CCAC incorporates the administrative model. According to section 6 (e), the

Commission can take any action that may be appropriate to combat and

eliminate abuse of dominance and anti-competitive agreements. Moreover,

hearings can be conducted by the Commission in section 7 (3) through the

Commission’s power to summon and examine witnesses in a hearing,

administer the oath and call for and examine documents. The exact specifics

of how the Commission thereafter arrives at its decision is not stated in the

Act, and there are no final rules of procedures in this regard. From the

researcher's experience, the Director compiles a preliminary investigation

report and submits it to the Board of Commissioners for final decision.

Enforcement powers in adjudication are also given to ‘the Commission.’

According to the CFTA, ‘the Commission’ under section 7 (1) (a)- (h) has the

power to make termination orders as well as impose ‘cease and desist’ orders.

Additionally, in section 22 (2) ‘the Commission’ can order compensation to an

aggrieved party as the Commission finds and if the conduct as it relates to

anti-competitive agreements persists and the party fails to terminate the

conduct they are liable to a fine of 50 million dollars and imprisonment for

one year.

4.2.1 Jamaica

In Jamaica, ‘the Commission’ has investigative powers by section 5 (1) (a) to

carry out investigations of anti-competitive business conduct in Jamaica. In

34

conducting its investigations, ‘the Commission’ has the power to conduct

hearings by section 7 (1) and summon and examine witnesses, administer

oaths and require documents to be submitted to the Commission, etc. Like

Guyana the exact specific in how the Commission thereafter arrives at its

decision is not stated in the Act, neither is there final RoP in this regard. Thus

the reasonable assumption is made that the Director afterwards presents a

preliminary report and submits it to the Body of Commissioners for final

decision. After a final decision has been made, the Commission’s powers are

limited under section 21 (a)-(b) to only notifying the enterprise of the finding

and directing them to take steps that are necessary to overcome the abuse.

Enforcement powers of adjudication are enforced strictly in the court and not

the Commission. According to section 47 (a), ‘the court’ is empowered to

order the offending party to pay individual fines that would not exceed one

million dollars and company fines of not more than five million. Moreover, in

47 (b) the Court can grant injunctions restraining the offending party from

engaging in the anticompetitive conduct.

4.2.2 Barbados

In Barbados, ‘the Commission’ is empowered to carry out an investigation for

competition law infringements under Section 5 of the Fair Competition Act.

Hearing are performed during the investigation, by the Commission in

accordance with section 6 (5) and the Commission is empowered to summon

witnesses to provide information on any matter. Unlike Jamaica, mentioned

above, enforcement powers in adjudication are given to the Commission, and

under section 15 the Commission shall serve notices on a party mandating

them to terminate the agreement. Failure by parties entails penalties under

35

section 15 (2) of a fine $150,000 in addition to (under 15 (2) (b)) 10 % of the

annual turnover of the enterprise.

4.3 Commentary

Thus it is asserted that provisions in the FCA of Jamaica suggest that there is a

shift towards the prosecutorial model of enforcement since the legislation

specifies that it is the court that has powers of adjudicating cease orders etc.

Meanwhile, on examining legislations in Guyana and Barbados, it seems that

both jurisdictions may be following the administrative model since there is a

mixing of roles of enforcement. In this Guyana and Barbados, it is clear that

the Commission authority ranges from investigative prosecutorial and

adjudicative rights. Adjudication power follow from the ability to prescribe

cease and desist orders etc.

As a result of the transfer of competition laws to the Caribbean Community,

renowned authors have discussed exhaustively that the region faces gaps in

enforcement. These gaps also have severe implications for the Commission

and parties involved.

36

CHAPTER 4

5.0 Implications of gaps in competition laws to CCC and NCAs

5.0. Implications of wording of RTC

Under the RTC, we have alluded to the fact that the CCC does not have

decisional autonomy, due to the constant interception of COTED. As

discussed, if the CCC observes a cross-border anti-competitive conduct, it

must wait for a member state to raise its concerns at a COTED meeting.

COTED thereafter must pass a resolution for the CCC to act. Otherwise, one

of the affected member states must make a complaint directly to the CCC after

it has compiled a preliminary report. Moreover, after the preliminary report

has complied and there may be any disagreements as to who should conduct

the investigation the CCC must cease any further examination of the matter

and refer it to COTED for a decision. The CCC is therefore constrained by the

decisions of COTED a political body. The RTC’s deliberate decision not to

accord to the CCC decisional autonomy and a supranational status in a liberal

sense stems from the reluctance of member states to surrender sovereignty. 76

Taimoon Stewart, therefore, calls the CCC ‘lame duck’ since COTED (which

comprise of member states) can determine the CCC’s mandate and actual

work in practice and can prevent the CCC from conducting an investigation

into a situation even though the CCC may perceive it to be anticompetitive.77

Moreover, in the investigation of cartel cases, which require high levels of

secrecy and confidentiality cartel cases may not be able to be effectively

76 Stewart (n 2) 277 ibid

37

investigated by NCAs with COTED involved.78 Thus for parties involved they

must at all times first make a complaint to their NCAs.

5.02 Implications in Wording of the Law and Offenses

However, having examined the legislations of Guyana, Jamaica, and Barbados

in comparison to the TFEU of the EU it can be observed that there are little

provisions for merger control (only Barbados) and no provision for illegal

state aid. Merger control enforcement is provided for in the UK enforcement

system with detailed guidelines as to which mergers may ‘raise a red flag’

given their concentrations and annual turnover. In the region, the RTC does

not mandate member states to enact merger control rules, and as mentioned so

far only Barbados has enacted limited rules on merger control. Developing

countries that have small economies sometimes argue that merger control

regulations are not needed due to the need for alliances in small economies.79

This argument is coupled with the fact that the public has little knowledge or

interest in the benefits of competition and how it can regulate mergers.80

Moreover, on the prohibition of state aid, public authorities within the

Caribbean region do provide aid to companies. State aid usually takes the form

of subsidisation for example aid to a national air carrier (as evidence in

Trinidad and Tobago subsidisation of Caribbean Airlines)81 or the

subsidisation of a five-star hotel (as evidence in Guyana’s subsidisation of the

78 Stewart (n2) 279 ibid80 Meetings of Caribbean Community Competition Commission meetings held in Jamaica, 201481 RJR News, ‘Government Subsidy for Caribbean Airlines Slashed,’ <http://rjrnewsonline.com/regional/government-subsidy-for-caribbean-airlines-slashed> accessed on 20th September, 2016

38

Marriott Hotel).82So far, however, the region is void of any competition

regulations against illegal state aid. Over the years, arguments have instead

arisen pointing to the small economy of many states within the region and the

need for such subsidisation.83

In addition to the omission of the offences concerning merger control and state

aid, learned author Maher Dabbah discusses some other omissions usually

present in developing countries that are also present in the Caribbean

Community namely adequate clarity as to vertical restraints and sections of the

offence of abuse of dominance.

On vertical restraint, Dabbah suggests that many developing countries lack

adequate mechanisms for dealing with vertical restraints. According to him

while it is true that legislations may provide a reference to vertical restraints,

the reference is not sufficient to clarify the approach needed on policy issues

relating to vertical agreements or the approach required for competition

authorities.84 Vertical restraints have mostly been given attention in the

develop world.85 We have discussed the UK regulatory regime as to vertical

restraints. The UK system comprises of the Vertical Block Exemption

Regulations (VABER) which seeks to safeguard vertical agreements so long

as they meet the necessary criteria as mentioned in the VABER. Additionally,

the Vertical Guidelines names the types of vertical agreements not enforceable

under Article 101.

82 Taroom khemraj, ‘The Proposed Kingston Marriott Hotel and Tourism,’ (2012) http://www.stabroeknews.com/2012/features/12/27/the-proposed-kingston-marriott-hotel-and-tourism/ accessed 20th September 201683 Stewart (n2) 284 Dabbah (n4) 32685 ibid

39

In the Caribbean, guidance on enforcement of vertical restraints is limited.

For example, in Guyana section 20 (3) of the CFTA we see the legislation

exempting ‘agreements’ which contributes to the improvement of production

or promotes technical or economic progress to which consumer receive a

benefit. Thus, in this section, there is only an implicit exemption to vertical

restraints since horizontal agreements cannot produce any technical or

economic benefit to consumers. However, the legislation does not go any

further in mentioning, as in the UK, the types of vertical agreements not

enforceable under section 20 (3) or what kind of vertical agreement not

enforceable under of 20 (1).

On Abuse of dominance and monopolisation, Dabbah suggests that sections

concerned with the prohibition of abuse of dominance may be worded to

mention only an excessively low selling price as amounting to an abuse of

dominance.86 However, in the field of competition law lower prices by firms

would be condemned and prioritised only where it is coupled with harmful

abuses such as predatory pricing or where the lowering of price causes price

discrimination. Moreover, the lowering of prices is ‘harmful’ if it is used to

bring about foreclosure such as to exclude competitors or prevent entry into

the relevant market.87 In Guyana section 24 (1) (d) of the CFTA prohibits the

imposition of unfair selling prices, however, there are no supplemental rules

that give further guidance. Ideally, as mentioned, it is only the ‘harmful’

abuses stemming from the imposition of unfair selling prices (that is to say

predatory pricing or price discrimination) that should be condemned by the

Commission. In the previous Chapter, we have discussed that in the UK the

86 Dabbah (n 4) 32687 ibid 327

40

enforcement of Article 102 of TFEU is coupled with the Commission’s Notice

on Enforcement Priorities. This Notice specifies guidance as to which abuses

are more harmful than others and priority in enforcement is given to the most

harmful abuses.

For the NCAs, in arriving at its decision as to whether an agreement is a

vertical agreement, exempted under the exemption sections of the local

legislation; will inevitably only have the wording of the legislations to rely on

in arriving at its decision (as opposed to detailed guidelines as in the UK).

Similarly, NCAs would not have any guidance as to which abuses are more

harmful than others and a priority in the offence of abuse of dominance. On

the limitations in the listing of competition offences- competition enforcement

will be limited to what is provided in the RTC and local legislations for NCAs.

Moreover, for the parties, Both private and public companies will feel the

effects of companies merging unabridged and impeding competition. By

Recital 25 of the EUMR, UK mergers are regulated, where the concentration

significantly affects the relevant market in the EU with the strengthened

dominant position of the enterprise. Similarly, on state aid, private companies

may feel the adverse effects of loss in fair competition with public authorities

providing aid ‘at will’ to an enterprise. In the UK under Article 107 and 108 of

the TFEU, state aid that gives an unfair advantage to an undertaking by

favouring it over other undertakings to the extent that it affects trade between

states are prohibited. In principle, all forms of aids that undermine the

principles of competition, and an open market are condemned; if they do not

then, they are permissible under Article 107 of the TFEU.

41

5.0.3 Implications in Detection and Investigation

During the conduct of an investigation, the CCAC is empowered under section

14 (2) (a)-(b) to send an investigator (after a warrant has been issued). That

investigator can enter and search premises and for the intent of making copies

inspect and remove documents or extracts in possession of a person. Similarly,

the Jamaica Fair Competition Act specifies that the power to enter and search

premises is given to an ‘authorised officer’ after he has obtained a warrant. On

the other hand, the Barbados Fair Competition Act states in section 7 (1) (a)-

(c) that ‘the Commission,’ having also obtained a warrant, has the powers to

enter and search premises and inspect and remove copies of documents in

control of any person.

In the UK Article 18 of Regulation 1/2003, more specifically aids the

investigation by authorising the Commission’s request for inspections.

Undertakings, therefore, need to provide all necessary information or written

answers to the Commission’s questions.88 The Commission may do this by a

simple request or by decision.89 Further to Article 18, Article 20 prescribes

that the Commission has the authority to enter a premise if it ‘specifies the

subject matter and purpose of inspection’ before doing any necessary

investigations. 90 The Commission's right to enter premises is controversial but

beneficial for surprise inspections (dawn raids). In Article 21 (1) provides that

the Commission may enter private premises which includes homes of

directors, managers and other staff of an enterprise.

88 Article 18 (1); Imran Aslam, ‘EC Dawn Raids: A Human Rights Violation,’ (2008) 5:1 The Competition Law Review <file:///C:/Users/Owner/Downloads/SSRN-id1846426.pdf >accessed 1st October, 2016, 489 Aslam (n 128) 590 ibid

42

In the UK, Duke observes NCAs are allowed to enter private premises

examine and obtain copies of books, business records. 91These documents will

be sealed, and NCAs can further ask for explanations on the documents

detained via the inspection.92 Duke notes that wire and oral communications

interception this can be found in jurisdictions such as the United States and the

United Kingdom which can undertake surveillance of business premises or

individuals.93

It is, therefore, worrying that local legislations in the Caribbean do not specify

advance interception of wire or oral communications. Moreover, most times

cartel must be investigated in a very discreet manner, and as such the

Caribbean Community stand to benefit from surprise searches and seizures (as

seen in the United Kingdom through dawn raids of companies).

Moreover, clarity needs to be given (in investigation procedures in national

legislaions) as to documents/records that can be removed during an

investigation and whether it includes a computer. Additionally, it is submitted

that lack of a leniency policy may cause severe implications for the

Commission in detecting cartels due to the lack of incentives for a

whistleblower. According to Michal Gal within the region there is evidence of

export cartels stemming from the low costs of imported products; these low

cost imported goods are the result of an export cartel. 94Thus international

cartels are rapidly expanding and impair development for local market

91 Duke (n66) 29092 ibid93 ibid94 Michal Gal, ‘Regional Competition Law Agreements: An Important Step in Antitrust Enforcement’ (2010) 60 University of Toronto Law Journal 1 <https://www.law.utoronto.ca/documents/conferences2/Trebilcock09_Gal.pdf> Accessed 3rd May 2016, 5

43

players.95 Adequate enforcement of international cartels, therefore, demands

expansive investigation techniques.

For the Region limitations in searches caused them to retrieve limited

documentation, which may be insufficient in proving the existence of

anticompetitive conduct. Competition cases are proven from ample

documentary evidence such as emails and other correspondences, phone call

records among other evidences. Thus, investigations depend on the advance

capabilities of the Commission to retrieve such critical evidence. Otherwise,

an investigation will be at a ‘standstill’ and ‘go cold.'

For the parties, as a result of the investigation going ‘cold,’ a prevalent

anticompetitive conduct would continue to create havoc in a market to the

detriment of market players and consumers.

5.0.4 Implications in Rules of Procedures

According to Dabbah, one feature of competition law regimes of developing

countries is that they are deficient in procedural rules as it relates to

conducting investigations, holding oral hearings and keeping the relevant

parties informed of developments in investigations.96 Thus it is asserted that an

effective competition law regime is essential since parties subject to

proceedings as well as third parties, needs to be well aware of the procedural

practices of the commission which may be bringing a case against them.

However, the situation may become problematic for NCAs in the Caribbean

Community. As mentioned in the Caribbean Region, member states have

drafted RoP documents but have not formally adopted rules of enforcement

95 Gal (n 94) 596 Dabbah (n 4) 328-329

44

for the enforcement of anticompetitive agreement or abuse of a dominant

position; usually, they rely on the procedures and guidance that is provided for

in their legislations. In Guyana a notable case concerned Ogle International

Airport -v- Competition and Consumer Affairs Commission 97by which OAI

contended that throughout the ‘investigation process’ they were not given ‘a

right to a fair hearing’ as the Commission began its investigation into the

complaint made by Air Service Limited. The Chief Justice upheld that the

CCAC had the ability to request information, but acknowledge that parties

needed to be aware of the investigation procedure undertaken by the CCAC.

The Chief Justice, however, cautioned the CCAC about the importance of

enacting RoP in moving forward. It should be noted that Barbados, however,

does contain supplemental rules in its legislation for mergers/merger fees98 and

application for authorisations/ authorisation fees.99

Previously, it was mentioned that the in the Caribbean Community only the

CCC has official RoP for the investigation of a competition complaint. It can,

therefore, envision that one of the resulting implication for NCAs not having

official RoP is the Commission would be inclined to operate in an ad-hoc

manner without for example taking steps to ensure that an investigation and

investigative report occur within a particular time frame. Moreover, the

contents of a preliminary investigative report may have varying differences

from case to case. Within the region, one case that shows the implications of

not having RoP and the resulting mixing of roles is the Jamaica Stock

97 Unreported (2012) High Court of Judicature98 SI 2009 No. 104 Fair Trading Commission (Fair Competition Merger Fees) Regulation 2009 and SI 2009 No. 105 Fair Competition (Merger) Rules 2009.99 SI 2009 No. 114 Fair Competition (Application for Authorization) Rules 2009 and SI 2009 No. 115 Fair Trading Commission (Fair Competition Authorization Fees) Regulation, 2009

45

Exchange v the Fair Trading Commission. 100In this case, the FTC stated that

‘the Commission’ was responsible under Sections 21 (1) (b) and 33 (2) and (3)

of the Fair Competition Act to adjudicate on the matter before it. The

legislation, however, did not specify who in the Commission would be making

such a determination, that is to say, Commissioners or Secretariat. The case

held that the provisions violated the separation of power doctrine since an

executive body (Secretariat) was performing the functions of a judicial body in

contravention of Chapter VII of the Constitution. Thus it is submitted that if

the legislation had mentioned ‘Body of Commissioners’ instead of

‘Commission’ the case might have been differently decided.

Additionally, Parties subject to a complaint by the commission may be unclear

as to the manner in which the investigation is taken and the procedures the

Commission takes. Moreover, as we saw in the case of Ogle International

Airport in Guyana, there may be extreme ambiguity as to when the parties will

‘have a right to be heard.’

5.0.5 Implications of Judicial Review and Scrutiny

In the EU decisions of the European Commission are appealable. Article 263

of the TFEU allows parties to petition the European Court of Justice to review

whether or not the components of the Commission’s decision is legal on

grounds of an essential procedural infringements for example lack of

competence or misuse of power.101 Article 263 (4) TFEU states as follows:

“Any natural or legal person may, under the conditions laid down in

the first and second paragraphs, institute proceedings against an act 100 Jamaica Stock Exchange v Fair Trading Commission Court of Appeal: Supreme Court Civil Appeal No. 92/97 of 2001101 Article 263 of TFEU (ex Article 230 TEC)

46

addressed to that person, or which is of direct and individual concern

to them, and against a regulatory act which is of direct concern to

them and does not entail any implementing measures.”

Thus upon the receipt of an application to institute proceedings by a ‘legal

person’ the EU courts will commence its judicial review process. Accordingly,

the scope of jurisdiction of the EU Courts is said to be a restricted jurisdiction

over Commission decisions rather than unlimited jurisdictions since the EU

Courts only review the legality of the decisions and (if they are illegal) to

annul them, the EU courts do not re-examine the case on its merits. 102

An examination of the CARICOM institutional structure shows that the

Caribbean Court of Justice (CCJ), is the final Court of Appeal for the CCC, as

such by Article 175 (15) ‘determinations’ made by the CCC are reviewable.

Thus what exactly are ‘determinations’ made by the Commission may be

subject to the interpretation of the CCJ. In the 2012 decision of the Trinidad

Cement Limited v CARICOM Competition Commission,103 we see the CCJ

extending its jurisdiction to not only review the determinations of the CCC but

also the how the CCC conducted its investigations. The CCC challenged the

jurisdiction of the Caribbean Court of Justice to review how it initiated and

conducted its investigation since Article 175 (2) of the RTC gives the CCJ the

power to review the ‘determinations’ of the Commission. The CCJ held that

since RTC created the CCC the CCJ could review all of its actions. Further,

the word ‘determinations’ in Article 174 (4) of the RTC includes not only the

102 Damien Geradin, ‘Judicial Review in European Union Competition Law: A Quantitative and Qualitative Assessment,’ (2011) Discussion Paper <file:///C:/Users/Owner/Downloads/SSRN-id1698342.pdf> accessed 1st October, 2016, 21103 Trinidad Cement Limited v CARICOM Competition Commission: Original Jurisdiction CCJ Application No. OA 1 of 2012

47

substantial ‘determinations’ of the case but also ‘determinations’ at the

investigative and enquiry stage. Thus this case highlights the extending arm of

a reviewing court not specialised in competition policy, in considering the

merits of a competition commission’s decision.

Additionally, in the three jurisdictions that have been discussed in this paper,

we see a similar pattern of decisions of the National Competition

Commissions being subject to review by a Judge in Chambers. In Guyana

section 51(1) -(2) of the CFTA specifies that aggrieved enterprise must appeal

within 15 days from the date of a Commission’s decision to a Judge in

Chambers. That judge can thereafter decide to ‘confirm, modify or reverse’

the finding of the Commission and where it considers appropriate direct the

Commission to reconsider specified matters of the appeal. Similar provisions

include section 49 (1) -(2) of the Jamaica Fair Competition Act and section 36

(1) –(2) of the Fair Competition Act of Barbados. Thus the legislations in the

Caribbean Community do not specify what aspects of the decision the Judge in

Chambers ought to ‘review’ during the appeal.

The above situation following the case of TCL v CCC and the legislations in

the region is worrying since the National Competition Commission or a

specialised court ought to be entrusted with the enforcement of competition

law provisions. There are implications of matters heard in a General Court

such as decisional inaccuracies.

For the Commission, the first major consequence would be that the CCC’s

decisions will be easily overturned on the ‘merits’ by the CCJ or in the case of

NCAs decision by a Judge in Chambers in an Appellate Court.Within the EU

48

we have seen that decisions of the European Commission are overturned not

on its merits but on the legality of the decision for example whether the

fundamental rights of parties were disadvantaged or procedures were not

followed etc. Thus if a General Appellate Court were to review a decision on

its merits, it would entail a finding of whether or not a case falls within the

ambits of the TFEU or RTC, etc. Such a conclusion, it is submitted, should not

be the function of a general appellate judge executing judicial review of a

Commission's decision. Usually, an appellate judge is not a specialist in

competition law, who would be able to make pronouncements on competition

law provisions. Geradin asserts that gone are the days where competition cases

concern typical goods or industries. With the rise of information technologies,

the economy has become more complex which pose a challenge for

competition enforcers regarding expertise, monitoring, and procedural

efficiency.104

On the complaining party and the party subject to the complaint, the

shortcomings of the Commission from making decisional errors will cause

parties to lose confidence in the work of the commission. As Gerdain notes

there are two types of errors Type I and Type II, in a Type, I error consumers

will be deprived of benefits with the banning of a procompetitive activity. In a

Type II error, however, both competitors and consumers will suffer from the

conduct prohibited. At worse the victim of infringement may simply be forced

out of a market.105 Thus if a General Court in looking at the merits of a

competition case, fails to categories an anti- competitive conduct in its

104 Geradin (n 102) 10105 Geradin (n 102)11-12

49

respective category, then consumers in addition to the parties could also be

affected.

CHAPTER 5

Implications in the Engineering of NCAs for the Caribbean Community

50

6.0.Implications of Traditional and Prosecutorial Model

For countries, that follow the traditional or the prosecutorial model there are

several advantages and disadvantages to which the researcher would now

discuss.

Arlen Duke suggests that the positives of the traditional model include the fact

that this model benefits from lower administrative costs since they are not

required to commence a legal proceeding in court (also depends on the

safeguards built into the model).106 One concern of the traditional model is the

independence of the adjudication decisions since a single agency starts the

investigation and issues the administrative order.107

However, this model does not come without its perceived negatives, according

to Arlen Duke allegations of prosecutorial bias have been made against the

traditional model and DG Competition. However, challenges to the European

system that it violates the right to a fair hearing by an independent and

impartial tribunal has been unsuccessful.108Arlen Duke maintains that

combating the negatives of prosecutorial bias demands the provision of the

judicial review. Judicial review where the court is independent and impartial

would serve to put appropriate checks and balances on the decisions of the

Commission. Care should, however, be taken to ensure that the reviewing

court is not overly deferential to the agency findings, as seen recently in EU

courts.109

106 Duke (n 63) 277107 ibid108 ibid109 Duke (n 63) 278

51

On the prosecutorial model, the separation of investigative and adjudicative

functions is said to have a positive impact Duke suggest that ‘it affords due

process.’110 Moreover Duke asserts that the prosecutorial model while

benefiting from an independent adjudicator also suffers from timeliness and

costs associated with the process. The cons of the prosecutorial model are

greater in a General Court since the judiciary would not be specially trained in

competition law and so a specialist court is recommended.’111 Where the

specialist court allows for fewer formalities the Commission can benefit from

a better balance of administrative efficiency and due process.112

The disadvantages listed above of both models may serve as implications for

the Commission and parties subject to a complaint. Moreover, implications

faced by the European Commission in adopting the traditional model, also

transfers to Guyana and Barbados since their models closely resembles this

model (traditional).The UK follows the traditional model, and the major

question is whether or not it violates human rights. By Article 1/2003, the

Commission has the authority to investigate, prosecute and to impose

sanctions for offences under Article 101 and 102. Parties, therefore, rely on

the judicial review of the EU courts as a safeguard against decisions of the EU

Commission. Thus, a major question is whether EU enforcement structure is

in full compliance with the European Convention for the Protection of Human

Rights and Fundamental Freedoms 1950 (ECHR). The Convention specifies

that parties are entitled to a fair/public hearing being held within a reasonable

time by an ‘independent and impartial’ tribunal.113

110 ibid 279111 ibid 112 ibid 113 Article 6 of Convention Right to a Fair Trial

52

6.0.2 Human/ Finacial Implications

Other implications arises as a result of low wage of the human resource

complement at NCAs. Many NCAs lose their valuable human resources as a

result of salaies being linked to the public service. Then Chief Executive

Officer of the Barbados Fair Trading Commission, Michelle Goddard alluded

to several challenges facing the Barbados FTC at a United Council for Trade

and Development (UNCTAD) Seminar.114 Accordingly, persons responsible

for setting salaries of the Commission have little understanding of competition

law and therefore set salaries at the same level as other government institution

(public service scale). Thus the Commission faces constraints in offering an

appropriate compensation package to employees, who have high technical

expertise. Another prevalent issue is the availability of adequate training for

employees since competition law is not a course at the University of the West

Indies, the FTC has to seek international training continually.

The CCAC of Guyana suffers from the all of the challenges faced by the

Barbados FTC. At the CCAC, since its establishment has seen a high turnover

of staff attributable mainly to the fact that salaries for technical employees

were set at the levels according to the public service scale. Thus the CCAC

has a major problem in retaining its human resource complement since it

became fully functioning in 2011. Dabbah observes that lack of financial

resources whether human ( that is to say sufficient expertise) or financial is a

serious hurdle facing the enforcement efforts of many competition authorities

114 Michelle Goddard, ‘Challenges of Implementing Competition Regime in a Small Developing Country: Barbados,’ Regional Seminar for Latin America and Caribbean Countries, UNCTAD Report (Sao Paulo 23-25 April 2003) <http://unctad.org/en/docs/ditcclp20038section3_en.pdf> Accessed 3rd May 2016

53

in the developing world. 115 As a result of the financial challenges, salaries

would be low and unattractive to specialised professionals. Moreover the

competition agency without trained professional is toothless.116 The resulting

situation is that many agencies in developing countries are understaffed.

Effective enforcement, in this case, would require the necessary staff of

lawyers, economists, investigators and case handlers. Dabbah further notes

that as a result of a shortage of staff enforcement of international cartels, anti-

competitive transnational mergers and cross-border abuse of dominance is

extremely costly. 117Thus enforcement has a slim chance of taking place as a

result of the limited budget; this is a key feature in most competition

authorities in developing countries.118

If the Commission lacks the finances, it needs it will be at a standstill in

investigating complex competition cases that relate to for example

international cartels and employing trained specialised officials within the

Commission. Thus as a result of its failure to hire key specialists, investigating

a competition complaint may be filled with inaccuracies and lapses in the

interpretation of the law and inconsistencies. Thus, for the parties involved

again decisions made by the Commission may be ‘sloppy’ causing devastating

effects.

6.0.3 Implications in Structure, Composition of NCAs

As mentioned most NCAs are not agencies of a respective government

ministry and operations are not autonomous entirely. Additionally, we have

115 Dabbah (n 4) 317116 ibid117 ibid118 ibid 318

54

discussed that most agencies employ overworked high-ranking officials with

little time on their hands to give competition cases the attention it deserves.

This issues coupled with the in frequencies of competition meetings (as a

result of lack work in the commission not being constant) or the ‘doubling’ of

officials gives rise to several implications.

For the Commission, the biggest effect to the Commission not operating in an

independent manner is that the decisions of the Commission could be biased

or prejudiced. This effect is as a result of the influences of an agency’s

Minister for determinations of cases to be in a certain way. If this were to

prevail, then ultimately there would be lacked confidence in public or private

entities who may want to bring a complaint to the commission.

Moreover, the implications for the parties (as a result of the cases not getting

the attention it needs) is that the decisions made by NCAs will be ‘sloppy’ or

inaccurate. Again, companies would lose faith in the work of NCAs and view

NCAs as not being able to live up to its mandate of ensuring fair competition

in a market. This inevitably is also devastating to consumers who will be

subject to monopolistic prices for goods and services as a result of enterprises

not competing on the market.

All of the implications noted in Chapter 4 and 5 undermine the effectiveness

of a competition agency. NCAs depends on the support they receive from

business and consumers who should look up to NCAs as the defender of

competition rights. Thus NCA must aim to solve the shortcomings faced in

the gaps of competition policy rules in the legislation and the engineering of

NCAs.

55

CHAPTER 6:

56

7.0 Remedying the Gaps with Solutions from EU, Authors and other

Practices

The gaps in the enforcement of competition policy for the Caribbean

community are indeed a major problem with serious implications for the

Commission the parties involved and consumers. A mistaken antitrust decision

banning, for instance, a pro-competitive discount or rebates deprives

consumers of lower prices and creates a price umbrella which protects

inefficient competitors.119 Added to this Damien Geradain asserts that costs for

an antitrust error are serious due to the fact that modern competition law

provides for strict sanctions of an administrative or criminal nature. In a

growing number of jurisdictions, competition law infringements are punished

by severe fines.120 Moreover, Geradain notes that forbidding firms to trade

freely in the market, severely interferes with an individual's freedoms such as

for instance freedom of association.121

Thus we can see why it is important for NCAs to get it right by plugging any

gap that could cause implications to parties subject to a complaint or

themselves. Below would be several solutions wordy of consideration.

7.1 Market an Effective Brand

For an agency to market an effective brand it can do so through its human

resource talent and reputation. If a commission has the ability to retain a

selection of high quality administrative and professional staff in the long term,

it aids the Commission in developing an effective brand.122 The benefits of a

119 Geradin (n 93) 12120 ibid121 ibid122 William E Kovacic, ‘How Does Your Competition Agency Measure Up?’ (2011) 7:1 European Competition Journal

57

good brand goes beyond the public perception that the Commission is

competent and equip to do the work. A good brand allows the Commission to

benefit from favourable allocations in its legislative budget and ensures greater

compliance from companies with laws relating to competition enforcement.123

Overall if the leadership of competition agencies wants to ensure that its brand

is constantly strengthened, they need to pioneer their agency’s strategies for

the long term and concentrate on the agencies overall reputation. 124One

workable strategy is additionally to establish linkages with International

Competition Network (ICN). 125 Additionally, as discussed, the projection that

the NCA is autonomous and free from government influences in decision

making process increases confidence in the operation of the agency.

Moreover, real performance projects to the public that the Commission can

live up to its obligations under varying national legislations through its ability

to prosecute cases, implement secondary legislations and formulate

guidelines.126 As discussed most agencies lack clear RoP and therefore there

may be ambiguity as to the mixing of investigative and adjudicative roles

which results in prosecutorial bias. Guideline/RoP help solve this ambiguity.

Moreover, since most competition agencies prescribe to an additional

advocacy role, agencies ability to convene workshops and seminars, produce

sector studies and engage in other forms of public consultations is another

indicator. 127

<http://www.tandfonline.com/doi/pdf/10.5235/174410511795887589?needAccess=true> accessed 1st October, 2016, 28123 ibid124 ibid125 ibid126 ibid 32127 Kovacic ( n 110) 32

58

The performance of competition agencies can only improve if the capability of

staff continually grows; knowledge, therefore, is a valuable input. With the

implementation of superior techniques the agency’s performance is likely to

improve and cases will be better prosecuted by the Commission.128 Thus

agencies must be abreast with economic theory, legal analysis, empirical work

and other notable trends129 This, however, can only be done through ongoing

investments for training at home or abroad. Agencies also stand to benefit

from training from multinational networks such as the Organisation for

Economic Cooperation and Development (OECD), the Competition Branch of

the United Nations Conference on Trade and Development (UNCTAD) and

ICN.130

Another factor that signals the effectiveness of a competition agency is its

ability to make information available to the public and disclose necessary

information as it develops. 131 For the work of competition agency to be

assessed and become transparent, the mechanism should be implemented for

them to release information. Kovacic discloses that this can be two-fold either

though disclosures on the commission’s website to annual reports, speeches,

databases coupled with information of what the Commission is currently

doing. 132Another mechanism for disclosure is through public consultations

with academics, law firms, economic consultancies or other groups which

know competition best.133 These groups can be engaged either through

questionnaires or individual hearings etc.

128 ibid129 ibid130 ibid131 ibid 40132 ibid 40133 Kovacic ( n 110) 40

59

Develop Cooperation/ Joint Enforcement and Advocacy Agreements

Authors Michal Gal and Taimoon Stewart both have identified solutions for

the region. Michal Gal states that in considering the shortcomings of

developing countries one solution could be an overarching Regional

Competition Law Agreement on Joint Enforcement and Advocacy Agreement

(RJCAS).134 RJCAS she claims has the potential to tackle the constraints in

enforcements relating to resources, capability, capacity and education,

compatibility and certainty.135

Taimoon Stewart on the other hands proposes that cooperation agreements.

She alludes to the fact that cooperation agreements can encourage deep

participation by all member states in the investigation of competition cases

since there is mutual assistance, exchange of confidential/ non-confidential

information by national legislation, consultations, positive comities and the

opportunity for notification of enforcement activities among member states.136

Moreover, a cooperative relationship with the USA, Europe and Canada and

other developed countries may prove to be essential since these countries

frequently initiate cartels.137

On the solution for the RJCAS and Cooperation Agreements, however, one

envisaged disadvantage is its limitation on member states’ sovereignty to

decide competition law cases on their shores since it is a consolidated effort in

jointly enforcing a competition matter.138 Additionally, Kovacic asserts that

134 Gal (n 85) 5135 ibid 136 Phillippe Brusick etal., ‘Competition Provisions in Regional Trade Agreements: How to assure Development Gains’ Chapter by Taimoon Stewart, ‘Special Cooperation provisions in Competition Law and Policy: The case of the Small Economies, UNCTAD Report (Geneva, 2005) 339137 Stewart ( n 2) 2138 Gal (n 88) 17

60

tension is a likely result if two or more competition agencies operate on the

same matter in same public domain since both agencies may want to compete

against each other in gaining supremacy. Further national competition policy

of an agency may suffer as no single agency will be empowered to determine

when litigations would commence.139 Thus both solutions are workable, but

member states need to consider the perceived disadvantages that could arise

before implementing such agreements. If member states determine that it is

workable and would like to retain jurisdiction over cases then it may be best

suited for him to specify enforcement only in cases that are of interest to all

countries such as those involving international cartels and keeping out other

cases from the agreement.140

7.2 Adopt Procedures from the EU (Previously mentioned)

The Caribbean does seek to benefit from the adaptation of some of the

practices followed by the EU, but given the differences in culture and

economy between the Caribbean and the EU, it is debatable what regulations

are in fact needed. Moreover, the case of TCL v CCC (previously discussed)

first acknowledged that courts needs to be cautious when making reference to

the EU. According to the CCJ care must be taken owing to the variance in

procedures and the dissimilarities in the legal instruments and overarching

principles of law, such as for example, difference in wording and nature.141 In

the areas of detection and investigation and judicial review, however, it is

worthwhile to consider the practices of the EU.

7.3 Detection and Investigation

139 Kovacic (n 110 ) 532 140 Gal (n 88) 17141 TCL v CCC para 27

61

During the conduct of investigations, several regulations of the EU (previously

mentioned) it is submitted can be transferred to the Caribbean Community.

These include for instance the provision of advance interception of wire and

oral communications and extension of places subject to be investigated in

legislations and scope for surprise inspections within the Region. As

mentioned cartel investigations demand expansive investigation techniques to

uncover documentary evidence needed to prove a case.

Along with other investigations tools, the Commission’s leniency policy is

another important tool in fighting cartels. Leniency policies offer companies

involved in cartels which self-report and hand over evidence either a reduction

in fines or total immunity.142 Total immunity is awarded if the enterprise

informs the Commission of an undetected cartel through sufficient information

that it can use to launch an inspection of premises named in the cartel.143

7.4 Judicial Review Scope

As mentioned the scope of jurisdiction of the EU Courts is said to be a

restricted jurisdiction over Commission decisions rather than unlimited

jurisdictions since the EU Courts only review the legality of the decisions and

if they are illegal to annul them, the EU courts do not re-examine the case on

its merits. 144The Commission enforces competition law provisions contained

in the TFEU and EU legislation, while the EU Courts task is only to review

the legality of the Commission’s decision enforcing EU competition law.145

Thus ‘EU Courts are not entitled- as in a classic appeal procedure- to

142 ec.europa.eu/competition/cartels/leniency/leniency.html143 ibid144 Geradin (n 93) 21145 ibid

62

substitute their point of view for that of the Commission and adopt a ‘denovo’

decision. When an EU Court finds a decision illegal, they must strike it down

(in full or in part).146 Thus the Caribbean Community can choose to take this

approach of prescribing limits of the powers of the CCJ.

7.5 Consolidated RoP

According to Damien Geradin real performance projects to the public that the

Commission can live up to its obligations under the RTC and varying national

legislations comes through its ability to prosecute cases, implement secondary

legislations and formulate guidelines. 147 As discussed most agencies lack clear

RoP and as such the procedures of NCAs are ambiguous. Parties to a

complaint may be unclear as to the Commission’s procedures, and as a result

of the traditional model followed by NCAs unsure whether there are mixing of

investigative and adjudicative roles which results in prosecutorial bias.

Thus another workable solution that can be considered is for a regional effort

of Consolidated Guidelines for RoP to be implemented by NCAs. This option

is proposed since each jurisdiction within the region would benefit from

guidelines in implementing RoP as it relates to handling of complaints,

investigation, hearing and determinations. For this proposal to work the onus

should be on the CCC to compile guideline of RoP that member states can

consider adopting. Previously we noted that the CCC was able to formalise its

RoP in 2011, which does offer guidance from a cross-border standpoint with

the procedures to be followed by the CCC. However, mentioned so far no

member states has comprehensive formally adopted rules regarding the

146 ibid147 Kovacic (109) 32

63

functioning of the commission as it investigates anti-competitive abuses such

anticompetitive agreements and abuse of dominance. Member States,

therefore, seek to benefit from Guidelines for Consolidated Rules since it

serves as a model template that they can use in moving forward. Previously

we noted that the CCC was able to formalise its RoP in 2011, which does offer

guidance from a cross-border standpoint (with the procedures to be followed

by the CC) but not a national standpoint.

CONCLUSION

In summary, one can say that the Caribbean Community faces gaps in its

enforcement system for competition policy. These deficiencies can be

categorised under two main headings namely gaps in the RTC and local

legislations and shortcomings in the engineering of NCAs. In the transfer of

64

law, we have discussed the limits in the wording of the RTC and other

national legislations, shortening of offences, lack of RoP and format of

investigations and judicial review. Whilest in the engineering of the NCAs,

issues flowing from composition and structure, the model adopted by the three

jurisdictions were additionally considered.

Ultimately NCAs, the parties subject to a complaint and consumers are

affected by the presence of shortcomings in the enforcement of competition

policy. NCAs must, therefore, seek solutions that would plug the gap which

includes marketing an effective brand by restructuring its image and ensuring

autonomy and no mixing of investigative and adjudicative roles following the

adoption of the traditional model of enforcement ( especially Guyana and

Barbados). Moreover, an overall revamp in setting wages to the public service

may result in the retention of its human resource complement that would also

aid in the marketing of an effective brand. Additionally in combating other

shortcomings member states can consider joint agreements on enforcement or

cooperation agreements with other NCAs within the Region. Moreover, other

solutions to consider include the CCC adoption of Consolidated Guidelines on

RoP for national enforcement and adopting ‘with caution’ certain procedures

from the EU relating to investigation and judicial review of cases.

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65

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APPENDIX 1: Map of CARICOM Countries

70

Downloaded from Heritage Foundation at <http://www.heritage.org/multimedia/infographic/2012/10/caricom-map> accessed 23rd September, 2016

71