After the Namibia Competition Commission (NaCC) recently used the authority vested in it by the Competition Act of 2003 to fine Sanlam Namibia and Professionals Provident Society (PPS) for N$15 million, Sanlam has confirmed that – together with PPS – it has entered into a consent agreement with the NaCC.
The consent agreement relates to the marketing agreement between Sanlam and PPS, which was investigated by the NaCC for a potential contravention of Section 23 (1) of the Competition Act. According to the NaCC, Sanlam’s marketing agreement with PPS was intended to impede competition in the long-term insurance industry by dividing market space amongst themselves.
Here market allocation is defined as competitors agreeing not to compete for certain customers or for certain geographic areas.
“The parties have agreed to pay a penalty of N$15 million and have admitted that the marketing agreement constitutes an unintended contravention of section 23 (1) of the Act.
“The parties have further agreed to take all necessary and pro-active steps to ensure that the marketing agreement is ceased within a reasonable period of time,” said Vitalis Ndalikokule, the acting chief executive of the NaCC.
Ndalikokule said the NaCC considers that the consent agreement reflects its policy imperatives of aiming to ensure compliance with competition law and advocacy consistent with the objectives of the Act. “The penalty appropriately balances and recognises the parties’ cooperation with the Commission to date,” Ndalikokule added.
“Having reached an amicable resolution to the matter, we’ve now initiated the process to lodge an application for exemption from Section 23 (1) of the Act. We’re well-poised to submit our application within the 30-day period stipulated by the NaCC in the consent agreement,” reads a statement released by Sanlam.
“In the meantime, the NaCC has confirmed that we may continue to write new risk provider series policies until the NaCC has reached a decision regarding our application. We look forward to a positive consideration of our application by the NaCC,” read the statement.
In the same statement Sanlam Namibia reassured its clients and its stakeholders that it subscribes to good governance practices and complies with applicable industry regulations and legislation in the country.