High Court Upholds CFTC Decision Against Airtel Malawi

The telecommunication company, Airtel Malawi Limited has lost its appeal case against the decision of the Competition and Fair Trading Commission regarding its application for authorization of an Exclusive Distribution Arrangement.

In May 2013 Airtel applied to the Commission for authorization of its Exclusive Distribution Arrangement for its recharge vouchers and other products in line with Section 44 of the Competition and Fair Trading Act Cap 48:09 of the Laws of Malawi.

In its determination of 31^st July 2013, the Commission approved the Exclusive Distribution Arrangement subject to amendments of some clauses in the Standard Distribution Agreement which were found to likely aggravate the lessening of competition in the distribution of Airtel recharge vouchers and other products.

Specifically, Airtel appealed against the Commission’s order that required the company to remove or amend a clause which imposed restrictions on the use of employees engaged by designated distributors not to be used to distribute products of Airtel competitors.

In his ruling delivered in the High Court Commercial Division in Blantyre on 10^th February, 2015 Justice Dr. M.C. Mtambo upheld the decision of the Commission that the clause in question was competition restrictive.

The Court ruled that Airtel was, through the clause in question, attempting to regulate the business affairs and conduct of its distributors which are independent businesspersons by leveraging its dominant market power.