By Dr. Priscilla Njako
SEP 10 – A discussion I was part of some weeks ago got me thinking. The conversation centered on the appropriateness, or otherwise, of legislation existing in the absence of a documented public policy.
The debate closed with an explanation from an expert that, in fact, policy and law are distinct. Legislation and regulations are not policy but, rather, tools that crystallize public policy into enforceable edicts. As such, policy formulation should precede crafting of attendant instruments, law included.
It is no news that our statute book contains Acts of Parliament that have preceded the development of attendant public policy or actually exist in the absence of such a policy. The Competition Act Cap 504 is a prime example. Exigencies of prevailing circumstances and reforms agenda may necessitate drafting and subsequent passing of a legal instrument to address an emergent situation. The process of policymaking, being complex and iterative, may not be the most responsive option in such moments.
The Competition Act has served the country well since coming into effect in 2011. The past thirteen years have seen the successful mainstreaming of modern competition law as an effective tool of market regulation. This reality invites the question: can we now work backwards from the Competition Act, towards a national policy on competition? The answer, to use Kenyan parlance, is: ‘burrofcos’! In fact, from where I sit, there is a clear benefit of legislation having preceded policy.
The information and insights gathered from enforcement of the Competition Act over the past 13 years present an invaluable repository to inform formulation of a strong policy. The Competition Authority of Kenya’s annual reports until June 2023, reveal that the agency investigated 334 anti-competitive practices, with the manufacturing sector leading in the number of cases. For example, the sector led with 36% of all cases investigated in the financial year ending June 2021, 19% in the year ending June 2022 and 15.5% of cases as at June 2023. On the mergers and acquisition front, the Authority analyzed 1,353 applications from virtually every sector of the national economy, giving it valuable information on the nature and structure of Kenya’s markets.
Addition of abuse of buyer power to the enforcement repertoire five years ago has afforded the Authority a microscopic look into the terrain within which micro, small and medium enterprises operate. A subsequent national competition policy would therefore be a best-bet fit in supporting sustainability of these enterprises that make up a significant 98% of all businesses in the country and create 30% of all jobs, annually.
That said, I consider that two things would be most critical in the policy formulation and design process. The first is effective stakeholder engagement. This is fundamental, given the close tie-in between public participation and the Constitutional imperative of transparency and accountability by public bodies. The array of stakeholders would need to be broad enough to include regional stakeholders such as the COMESA Competition Commission and the East African Community Competition Authority, while still reaching parties that operate from the fringes of the economic space, specifically MSMEs.
Second, the policy design would do well to prioritize monitoring and evaluation, with assessment of impacts taking precedence over activities and processes. Within the policy should be embedded a monitoring framework that incorporates evaluation throughout the implementation process. This is in line with the Government’s move towards institutionalization of performance management in the public service.
It will appear that, after all, there is something to be said in support of law preceding policy. However, legislating in the absence of a public policy is equivalent to putting the cart before the horse, which, though possible, is not optimal nor effective option for setting direction, guiding and influencing decision-making.
The writer is CAK Buyer Power Department Manager
