MBABANE – It is victory for Swazipharm Wholesalers (Proprietary) Limited and businessman Kareem Ashraff.
Yesterday, the Board of Commissioners of the Eswatini Competition Commission dismissed applications by the Eswatini Competition Commission Secretariat seeking to suspend and rescind a previous Board decision relating to a merger dispute involving Swazipharm Wholesalers (Proprietary) Limited and Kareem Ashraff.
In its judgment, Board Chairperson Miccah Nkabinde upheld a preliminary point of law raised by Swazipharm Wholesalers and Ashraff, finding that the Secretariat lacked the legal standing to institute the proceedings in its own name.
The matter arose after the Secretariat launched two interlocutory applications following a decision issued by the Board on August 29, 2025. In that earlier decision, the Board refused an application for a declaratory order that an agreement or transaction concluded by Swazipharm Wholesalers and Ashraff on December 30, 2021 constituted a merger under the Competition Act, 2007.
Following that ruling, the Secretariat first sought an order staying execution of the Board’s August 2025 decision pending the determination of a rescission application it intended to file. It subsequently filed the rescission application, arguing that the Board’s earlier order had been issued in error.
Swazipharm Wholesalers and Ashraff opposed both applications and raised several preliminary legal objections before addressing the merits. Those objections included a lack of legal standing, failure to meet the legal requirements for rescission, functus officio, lack of procedural basis for granting a stay of execution and abuse of process.
The Board directed that the preliminary legal points be argued first because, if upheld, they would dispose of the applications without the need to consider the merits.
Key to the Board’s determination was the identity of the applicant.
The judgment noted that the notices of application and founding affidavits cited the applicant as the Eswatini Competition Commission Secretariat. However, within the body of the affidavits, the applicant was described as the Eswatini Competition Commission established under Section 6 of the Competition Act.
The Board found this inconsistency significant. It held that the description of the parties in the citation of the proceedings takes precedence over descriptions contained within the affidavits because the citation formally identifies the litigants before the tribunal.
The Board, therefore, concluded that the applicant before it was the Secretariat rather than the commission. The judgment also referred to statements made by the Secretariat in its own founding affidavit, where it acknowledged that it had no independent legal personality and no direct right of appeal to the courts.
According to the Board, that amounted to a concession that the Secretariat itself lacked legal personality and that only the commission possessed the right to institute legal proceedings before the courts.
Swazipharm Wholesalers and Ashraff argued that the Secretariat is merely the investigative arm of the commission and derives no statutory authority to litigate independently before the Board.
They contended that while the Secretariat investigates alleged anti-competitive conduct, it is not empowered to challenge decisions of the Board in its own name.
The Secretariat, on the other hand, argued that it possessed the necessary legal standing because it was responsible for protecting the integrity of the Competition Act and safeguarding the public interest.
It submitted that the body charged with investigating anti-competitive conduct should be permitted to challenge decisions that undermine the objectives of the legislation.
However, the Board noted that the Secretariat also acknowledged in its supplementary heads of argument that it is merely the administrative and investigative machinery of the commission and does not possess a separate legal personality.
In considering the issue, the Board examined sections 6 and 18 of the Competition Act.
It found that Section 6 establishes the commission as a corporate body capable of suing and being sued in its own name, while Section 18 establishes the Secretariat as the investigative arm of the commission.
The judgment states that the Act confers no authority upon the Secretariat to institute legal proceedings independently.
According to the Board, there is a distinction between the Secretariat’s investigative and prosecutorial functions and the commission’s legal personality.
While the Secretariat may investigate anti-competitive conduct and prosecute cases before the Board on behalf of the commission, the power to institute legal proceedings remains vested solely in the commission.
The Board held that Parliament did not authorise the commission to delegate that right to one of its internal organs.
It further observed that the Secretariat had not been a party to the original proceedings decided on August 29, 2025, where the applicant had been the commission itself.
The judgment also rejected the Secretariat’s argument that it could litigate on the basis of public interest.
The Board acknowledged that the commission has statutory responsibilities to regulate competition and protect the objectives of the Competition Act.
However, it held that those statutory responsibilities are distinct from the doctrine, which permits litigation in the public interest.
The Board noted that this doctrine had previously been rejected in Eswatini by the courts and, therefore, could not provide the Secretariat with legal standing.
Another issue identified by the Board concerned the Secretariat’s heads of argument.
The judgment states that although the original applications cited the applicant as the Eswatini Competition Commission Secretariat, the Secretariat later altered the citation in its heads of argument to read ‘Eswatini Competition Commission’, removing the word ‘Secretariat’.
“No application had been made to amend the citation and no order authorising such an amendment had been granted,” the Board observed.
Swazipharm and Asharaff were represented by Modicai Donga of S.V. Mdladla and Associates. It concluded that the unilateral change appeared intended to neutralise the respondents’ challenge to the Secretariat’s legal standing and could not be accepted.
Having upheld the point relating to legal standing, the Board proceeded to consider whether the rescission application met the requirements of Rule 46 of the commission’s Rules of Procedure.
Rule 46 allows the Board to rescind or vary a decision in limited circumstances, including where the decision was void from the outset, obtained by fraud or common mistake, where there is a patent error in the decision, or where material evidence previously unavailable has been discovered.
The Board found that the Secretariat based its rescission application primarily on allegations that the Board had misinterpreted the definition of an ‘enterprise’ under the Competition Act.
The Secretariat argued that the Board had adopted an unduly narrow interpretation by failing to consider the role of natural persons in transactions involving enterprises.
It further submitted that the decision could damage public confidence in the commission and weaken enforcement of merger notification requirements.
The Board found that these complaints did not amount to a patent error as required by Rule 46.
Instead, it held that the Secretariat was advancing a different legal interpretation of the Act and disputing the Board’s conclusions.
According to the judgment, such arguments may constitute grounds for an appeal, but do not satisfy the requirements for rescission.
The Board further found that other grounds advanced by the Secretariat, including alleged misapplication of regulations, procedural irregularities, financial and notification errors and the consequences of non-notification, also fell outside the circumstances in which rescission may be granted under Rule 46.
Having reached those conclusions, the Board found it unnecessary to consider the remaining preliminary objections raised by Swazipharm Wholesalers and Ashraff.
The Board accordingly upheld the respondents’ point of law that the Secretariat lacks legal standing to sue in its own name, dismissed both applications and ordered that each party bear its own costs.
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