The Competition Act promotes and safeguards competition in the national market.
Section 5 of the Competition Act contains a general prohibition against restrictive agreements entered into between undertakings carrying on a commercial or economic activity, decisions by associations of undertakings and concerted practices among undertakings having the object or effect of restricting, distorting or preventing competition in Malta or which may affect trade between Malta and any one or more Member State.
Thus, for instance, the Competition Act prohibits cartels, whereby a common strategy is adopted in order to eliminate the risks of competition. This in turn deprives consumers of the benefits of competition, such as better prices, wider choice and innovation.
Abuse of dominant position
Section 9 of the Competition Act prohibits the abusive conduct by a dominant undertaking, such as charging discriminatory or predatory prices and limiting production An undertaking is dominant when it has the ability to act independently of its customers, competitors and consumers. Establishing if a company is dominant requires a complex economic assessment of a number of elements but, as a general rule, a high market share is a strong indicator of dominance.
Under the Control of Concentrations Regulations, 2003, mergers and acquisitions which involve a change in control and satisfy a certain turnover threshold are assessed by the Office for Competition. The aim of merger review is to ensure that mergers do not substantially lessen competition.
Other types of unfair competition
The Consumer Affairs Act applies a number of EU laws in areas such as misleading advertising, doorstep selling, product liability and unfair contract terms.
The Office for Consumer Affairs within the Malta Competition and Consumer Affairs Authority is composed of three directorates namely: the Complaints and Conciliation Directorate which is primarily responsible to offer assistance to consumers and provide mediation between consumers and traders, the Enforcement Directorate which is mainly responsible for ensuring observance of consumer related legislation falling within the jurisdiction of the Consumer Affairs Act and the Information, Education and Research Directorate which is responsible for disseminating information regarding consumers’ rights, stimulate good trading practices and educating consumers.
National competition authorities
Malta Competition and Consumer Affairs Authority
The Malta Competition and Consumer Affairs Authority was set up on the 23rd May 2012. The functions of the Authority are:
- to promote and enhance competition;
- to safeguard consumers’ interests and enhance their welfare;
- to promote voluntary standards and provide standardization related services;
- to promote the national metrology strategy;
- to promote the smooth transposition and adoption of technical regulations; and
- to perform such other function that may be assigned to it under this or any other law or regulations.
Competition and Consumer Appeals Tribunal
The Tribunal which is composed of a Judge and two other members from a panel of ordinary members is empowered to hear appeals brought before it in terms of the Competition Act and the Consumer Affairs Act. According to the Competition Act, any udertaking or association of undertakings concerned may appeal before the Appeals Tribunal from any infringement decision, cease and desist or compliance order, administrative fine and, or daily penalty payment adopted or imposed by the Director General for Competition and by the Director General for Consumer Affairs. Furthermore, any decision taken by the Director General under the Control of Concentrations Regulations may also be appealed before the Appeals Tribunal.
Office for Competition
The Director General of the Office for Competition is involved in the day to day administration and enforcement of the Competition Act in all sectors of the economy and the Control of Concentrations Regulations. Together with its infringement decisions the Office may impose administrative fines and issue Cease and Desist Orders and Compliance Orders on undertakings breaching the Competition Act.
Strict provisions govern company mergers
A merger or acquisition must be notified to the Director General of the Office for Competition for approval before it is implemented. Notification must take place according the CN Form found in the Schedule to these Regulations within 15 working days from the date of the conclusion of the agreement, the announcement of the public bid or the acquisition of a controlling interest.
The CN Form of the Control of Concentrations Regulations is already added as a link above.
The Director General of the Office for Competition has the power to investigate a reasonable allegation in writing of a breach of Articles 5 and 9 of the Competition Act and/or Articles 101 and 102 of the Treaty on the Functioning of the European Union. There is no mandatory form to be submitted nor any prescriptive period within which a complaint must be made.
Competition law firms in Malta provide a listing of law firms, attorneys and lawyers specialising in competition law.
The Enterprise Support Incentives are designed to help enterprises meet the challenges of a global economy through networking, business development and improved international competitiveness.