Maxes Office Machines and Riso Africa, have entered into consent agreements with the Namibian Competition Commission (NaCC).
The agreements come after an investigation into allegations of anti-competitive behaviour revealed an exclusive distributorship agreement between the two entities.
NaCC found that Maxes and Riso Africa violated Section 23(1) read with Sections 23(2)(b) and 23(3)(e) of the Namibian Competition Act No.2 of 2003 by entering into an agreement that granted Maxes sole distribution rights for Riso-related products in Namibia.
The regulator’s spokesperson, Dina //Gowases said although the parties disputed some of the factual findings and interpretation of the Act, they acknowledged that their conduct unintentionally contravened Section 23. Consequently, they opted to settle the matter through consent agreements.
“As part of the settlements reached on April 21, 2023, Maxes and Riso Africa agreed to individually pay a total settlement amount of N$341,601.12 to the Commission. The sum includes a pecuniary penalty and a portion of the Commission’s costs incurred during the investigation and subsequent proceedings. The payment is scheduled to be made within 24 months after the confirmation of the consent agreements as orders of the High Court,” she said.
According to Section 40 of the Namibian Competition Act, the Commission has the authority to enter into settlement or consent agreements with concerned entities, outlining the terms for submission to the High Court for confirmation as court orders.
Once confirmed, these agreements will serve as a final settlement of the investigation and conclude the proceedings.
This comes after the investigation revealed that the companies had entered into an exclusive distributorship agreement that restricted other distributors from trading in Riso Africa’s office printing equipment, associated products, and after-sale services.
//Gowases explained: “The exclusive distributorship agreement designated Maxes as the sole distributor, service provider, and retailer of Riso Africa’s office printing equipment, associated products, and services.”
The NACC argued that this type of conduct creates barriers to entry into the market.
“The exclusive agreement prevents interested distributors from trading in the supplying of Riso Africa’s office printing equipment and associated products, as well as providing after-sale services to those products.”
The investigation specifically focused on the distribution of digital duplicators, which are commonly used for mass printing in various educational, governmental, and private institutions.
While other brands of digital duplicators are available in Namibia, such as Duplo, Ricoh, and Nashua, the investigation revealed that Riso digital duplicators constituted a significant portion of the market.
The NACC said that the exclusive agreement impeded intra-brand competition for Riso-related products but allowed for competition between other brands.
