Comesa watchdog to review Safaricom Ethiopia entry deal

 Safaricom CEO Peter Ndegwa. PHOTO | POOL

By BRIAN NGUGI
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SUMMARY

• The Common Market for Eastern and Southern Africa (Comesa) Competition Commission has launched a formal inquiry into the joint venture between Safaricom and its parent firm Vodafone for Ethiopia entry.
• The regional trading bloc’s competition watchdog said it’s investigation will assess whether the merger of the two telcos would skew competition in the regional market.

The Common Market for Eastern and Southern Africa (Comesa) Competition Commission has launched a formal inquiry into the joint venture between Safaricom and its parent firm Vodafone for Ethiopia entry.

The regional trading bloc’s competition watchdog said it’s investigation will assess whether the merger of the two telcos would skew competition in the regional market.

“The Commission will, in accordance with the provisions of the Regulations, determine, among other things, whether or not the proposed transaction is likely to substantially prevent or lessen competition within the Common Market and whether the proposed transaction is or would be contrary to the public interest,” said the watchdog in a notice.

“In view of this, the Commission hereby gives notice to all interested stakeholders, including competitors, suppliers and customers of the parties to the proposed transaction to submit written representations to the Commission with regard to the subject matter of the proposed inquiry. All written representations should be sent to the Commission not later than 19th October 2021.”

The Safaricom-led consortium, which also includes British development finance agency CDC Group and Japan’s Sumitomo Corporation received a telecommunication operator licence in Ethiopia in July this year after incorporating a local company, setting the stage for Kenya's largest telco to start operations in the market of over 100 million people.

Safaricom, which owns a majority stake in the consortium said last month it is gearing up for Ethiopia commercial launch and announced a countrywide staff recruitment drive.

By June next year, the company aims to build a team of 1,000 employees, Anwar Soussa, managing director of Safaricom Ethiopia was quoted saying after a press briefing with journalists in Addis Ababa.

The European Commission (EC) cleared the joint venture between Safaricom and its parent firm Vodafone last month