The Cabinet approved a new draft law on competition and consumer protection on Friday, August 23. The Ministry of Trade and Industry (MINICOM) has highlighted its key features. This new proposal introduces comprehensive reforms designed to foster fair market practices and enhance consumer rights. The bill, which will have to be tabled before Parliament, broadens the definition of ‘consumer’ to cover all transactions not intended for resale or further processing, thus providing more extensive protection for individuals and businesses engaged in direct purchases. The New Times breaks down 11 key highlights in the proposed law. ALSO READ: Trade Minister Sebahizi on boosting local manufacturing, addressing market mismatch Tackling anti-competitive practices To combat unfair competition, the draft law classifies prohibited practices into two main categories such as vertical and horizontal. Vertical practices include resale price maintenance and the misuse of intellectual property. Horizontal practices target more blatant collusions such as price fixing and market allocation. Regulating essential facilities The bill introduces measures to control essential facilities that might foster economic dependency. This is aimed at preventing businesses from monopolizing crucial infrastructure. ALSO READ: Rwandan trade minister urges action to implement AfCFTA Multilevel marketing oversight Aimed at curbing pyramid schemes, the legislation regulates multilevel marketing and direct selling practices, ensuring more transparency and fairness in these business models. Subsidies and state aid control To prevent market distortions, the bill mandates that any subsidies or state aid must be notified to and approved by the regulator, in this case Rwanda Inspectorate, Competition and Consumer Protection Authority. This includes setting thresholds for minimal intervention to maintain market balance. Enhanced regulatory collaboration The new draft law promotes better coordination among regulatory bodies to improve consistency and efficiency. It encourages collaboration with regional authorities like the East African Community Association (EACA) and the African Continental Free Trade Area (AfCFTA) to address cross-border transactions. Revised merger regulations A more robust framework for mergers and joint ventures is established under the bill, aimed at scrutinizing business consolidations to ensure they do not harm competitive market dynamics. Empowered market inquiries The proposed legislation grants the regulator the power to conduct market inquiries across all sectors, allowing it to collect information and publish findings to enhance transparency and accountability. Strengthened consumer protection Consumer rights are bolstered through regulations that cover safety, information, and redress. Key provisions include a ban on unfair contractual terms, ensuring accurate product information, enforcing safety standards, and providing remedies for defective products. E-commerce regulations The bill also addresses the rapidly growing e-commerce sector by setting clear obligations for online sellers and intermediaries to protect consumer rights in digital transactions. New compliance and investigation measures To ensure adherence to the law, the bill introduces voluntary compliance programs, such as leniency and settlement mechanisms, and strengthens investigation provisions for effective enforcement. Price and distribution regulation Lastly, the law aims to regulate price formation and distribution channels, giving the Ministry the authority to intervene when trade malpractices are detected.
