UNIVERSITY OF KIGALI (UoK)

School of Law

CONSUMER PROTECTION, COMPETITION AND

INTELLECTUAL PROPERTY

Dr. Nkubito William

E-mail: wnkubito@uok.ac.rw
Mob. +250788457784
 Chapter I. Introductory part
1.1. Importance of legislation on ompetition & Consumer
Protection
1.2. Background
1.3. Objectives of the Competition and Consumer
Protection law
Chapter II. Branches of competition law
2.1. Anti-Competitive practices
2.1.1. Agreements
2.1.2. Decisions of associations of enterprises
2.1.3. Concerted practices
2.1.3.1. Factors for the establishment of a concerted
Practice
Chapter 3. Restrictive practices of competition
3.1. Directly or indirectly fixing prices
3.2. Agreements to fix trading conditions
3.2. Agreements to share markets
3.4. Agreements to limit production or investment
3.5. Collusive tendering
3.6. Joint purchasing/selling
3.7. Information sharing
3.8. Exchange of price information
3.9. Exchange of non-price information
3.10. Advertising
3.11. Standardization agreements
3.12. Exceptions to Article 6
Chapter 4. Abuse of a dominant position
4.1. Test for determining abuse of a dominant
position
4.2. Test for determining a dominant position for an
enterprise
4.3. Market definition
4.3.1. The product market
4.3.2. The geographical market
4.4. The test of “Small but Significant Non-transitory
Increase in Prices (SSNIP)”
4.5. Assessing Dominance (indicators)
4.5.1. Existing Competition
4.5.2. Market shares
4.5.3. Potential Competition
4.5.4. Powerful buyers
4.5.5. Economic regulation
4.5.6. Intellectual Property Rights
4.5.7. Collective dominance
4.5.8 Territorial Scope
4.6. Abuse of a dominant position
4.6.1. Concept of abuse
4.6.2. Categories of abuse
4.6.3. Abuse in related markets
4.6.4. Factors considered whether a dominant position
is being abused
4.6.5. Acts of Unfair Competition
4.6.6. Grounds for authorizing an enterprise to take part
in agreements of an anti-competitive nature
Chapter 5. Regulation of competition at Regional &
International levels
5.1. EAC Context
5.2. AU Context
Chapter 6. Consumer Protection Law
6.1. Rights of consumers
6.1.1. Right to safety
6.1.2. Right to information
6.1.3. Right to choose
6.1.4. Right to be heard
6.1.5. Right to education
6.1.6. Right to redressal
6.1.7. Right to a healthy environment
6.2. Methods of consumer protection
6.2.1. Self-regulation by businesses
6.2.2. Consumer Associations
6.2.3. Consumerism
6.3. General theory of contracts
6.3.1. Types of consumer contracts
6.3.1.1. Sale & purchase of goods contracts
6.3.1.1.1. Protection of consumers in Sale & purchase of
goods contracts
6.3.1.1.1.1. Fit for purpose
6.3.1.1.1.2. Satisfactory quality
6.3.1.2. Supply of services contracts
6.3.1.2.1. Suppliers duties
6.3.1.2.1.1. A duty of reasonable care & skill
6.3.1.2.1.2. A duty to supply the service within a
reasonable time
6.3.1.3. Hire purchase agreements
6.3.1.4. Credit sale agreements
6.3.1.5. Loan linked agreements
6.3.1.5. Credit card sales agreements
6.4. Product safety
6.4.1. Safety of goods
6.4.2. Product quality standards
6.5. Resolution of conflicts of consumption
 Introduction
 Competition law (also known as antitrust law) is the body of
legislation intended to prevent market distortion (falsifications)
caused by anti-competitive practices on the part of businesses.
 It is a branch of law that seeks to promote economic
competition by regulating the behavior of companies, ensuring
that markets remain competitive and that consumers have
choices.
 The term competition refers to economic competition of two or
more separate enterprises (businessmen) engaged, on the same
market, in identical or similar commercial activities.
 Competition/Antitrust law is a branch of law that prohibits
anti-competitive conduct such as abuse of dominance, certain
agreements, practices and business strategies that restrict
competition in order to protect consumers from unfair prices
and business practices.
 Competition law was enacted to regulate trade and commerce
by preventing unlawful restraints, price-fixing, and monopolies.
 It is also meant to promote competition and to encourage the
production of quality goods and services at the lowest prices.
 The primary goal is to safeguard public welfare by ensuring
that consumer demands will be met by the manufacture and sale
of goods at reasonable prices.
 Competition law aims at encouraging competition in the
economy by prohibiting practices that undermine the normal
and fair course of competition practices in commercial matters.
 It also aims at ensuring consumer’s interests promotion and
protection.
 Trade & Commerce: Trade stands for selling and buying goods in exchange for
money. Two or more parties are involved in it. However, commerce stands for the
entire process of delivering products from manufacturers to consumers. It
comprises factors like transportation, banking and insurance, warehousing etc.
Importance of legislation on Competition and Consumer
Protection
 The competition and consumer protection law in its nature promotes
equality by providing fair business framework in which economic
operators are offered the same opportunities and chances to compete
each other.
 As economies move progressively towards increased liberalisation,
certain undesirable business practices can emerge which act as a
hindrance to development and economic growth.
 The absence of legislation on competition and consumer protection
in Rwanda would create opportunities for some sectors of the
business community to engage in unfair business practices, such as
price fixing, speculative hoarding and collusive tendering.
 Competition law is about applying rules to make sure businesses and
companies compete fairly with each other. This encourages enterprise
and efficiency, creates a wider choice for consumers and helps reduce
prices and improve quality.
 Competition law aims to promote fair competition; its
purpose is not to condemn or penalise those industries
that have large shares of the market.

 Consumers are adequately protected from firms, whether

large or small, which engage in collusion that is designed
to prevent competition by agreeing on fixed prices for
example (Cartels).
 Competition law is complementary to trade liberalisation:
In the absence of the appropriate competition rules and
supporting institutional infrastructure, consumer welfare
and developmental benefits have been questioned in the
light of the experiences of many developing countries.

• Cartels: an association of manufacturers or suppliers with the purpose of

maintaining prices at a high level and restricting competition.
 Potential benefits of a shift towards a more market-oriented
economy cannot be realised unless business firms are
prevented from imposing restrictions on competition.

 In the light of Rwanda’s commitment to a liberalised economy,

there is a need for a fair and equitable environment where
producer and consumer can maximise their profit and
satisfaction respectively.
 Background of competition law
 Since 1995, a large programme of socio-political reforms,
aimed at improving justice, governance, human resource
development and democratisation has been
implemented in Rwanda.
 This has been in parallel with economic reform. We
witnessed important changes, including privatisation of
state-owned enterprises, financial and banking sector
reforms, improved public financial management and civil
service reform.
 Rwanda has also embarked on a programme to
modernise its legislative and regulatory framework for
trade and investment, with the aim of fostering a modern
and competitive private sector.
 The emergence of a viable private sector to serve as the principle
engine of the economy is key to Rwanda’s development.
 It is in this context that Rwanda’s economy was expected to
become “private sector led” by 2020.
 Competition law was formulated with the aim of contributing
to the wider government Economic Development and Poverty
Reduction Strategy (EDPRS) for strengthening the policy,
institutional and legal framework under which the private sector
operates.

 Furthermore, firms facing competitive pressures in the national

context are more likely to survive in the extremely competitive
international context.
 In this context, promoting competition in Rwanda is the best
long-term strategy to promoting Rwandan firms abroad.
 In Rwanda , competition and consumer protection is regulated
by the law Nº36/2012 OF 21/09/2012 relating to competition and
consumer protection.
 We also have a Competition and Consumer Protection
Authority (Rwanda Inspectorate , Competition, and Consumer
Protection Authority -RICA) which is responsible for
monitoring, investigating, and enforcing competition and
consumer protection rules.
 Competition law at international level
 At the international level, competition law is mainly
governed by the World Trade Organization (WTO) and
its Agreement on Trade-Related Aspects of Intellectual
Property Rights (TRIPS).
 TRIPS establishes minimum standards for the
availability, scope, and use of seven forms of intellectual
property namely, trademarks, copyrights, geographical
indications, patents, industrial designs, layout designs
for integrated circuits, and undisclosed information or
trade secrets.
 In the European Union, competition law is governed by
the Treaty on the Functioning of the European Union
and the Competition Act.
 For example, article 81 (1) of this Treaty states:
“The following shall be prohibited as incompatible with the internal
market: all agreements between undertakings, decisions by
associations of undertakings and concerted practices which may
affect trade between Member States and which have as their object
or effect the prevention, restriction or distortion of competition
within the internal market, and in particular those which:
(a) directly or indirectly fix purchase or selling prices or any other
trading conditions;
(b) limit or control production, markets, technical development, or
investment;
(c) share markets or sources of supply;
(d) apply dissimilar conditions to equivalent transactions with other
trading parties, thereby placing them at a competitive disadvantage;
(e) make the conclusion of contracts subject to acceptance by the
other parties of supplementary obligations which, by their nature or
according to commercial usage, have no connection with the subject
of such contracts.”
Objectives of the Competition and Consumer Protection
law
 The objectives of the Competition and Consumer Protection
law are the following:
 To provide consumers with competitive prices and product
choices at the best possible quality.
 To ensure that small and medium-sized enterprises have an
equitable opportunity to participate in the economy and to
promote a greater spread of ownership.
 To provide the incentives to producers within the country for
improvement of production and quality products through
technical and organisational innovation.
 To enhance the competitiveness of Rwanda enterprises in
world markets by exposing them to competition within the
country.
 To create a conducive environment to foreign direct
investment in the country.
 To promote economic efficiency and enhance consumer
choice, encouraging the development of Rwanda’s economy.
Branches of competition law
 Regulating anti-competitive behaviour/agreements
between two or more enterprises, and
 Regulating the abuse by one enterprise or a group of
enterprises of its/their dominant position in a particular
market.

• An entity is known as an enterprise if it is carrying out an economic

activity.
• An economic activity can be defined as the production and distribution of
goods and services.
• Consumer: a person who purchases or acquires a commodity or a service
for personal or family use for non-commercial purposes.
2.1. Anti-competitive practices
 Competition allows companies to compete in order for
products and services to improve; promote innovation; and
provide more choices for consumers.
 In order to obtain greater profits, some large enterprises take
advantage of market power to hinder survival of new
entrants.
 These behaviors refer to actions taken by a business or
organization to limit, restrict or eliminate competition in a
market, usually in order to gain an unfair advantage or
dominate the market. They are often considered illegal or
unethical and can harm consumers, other businesses and the
broader economy.
 They prevent or reduce competition in a market, and typically
lead to market distortions resulting in higher prices, lower
quality products, poorer service and a stifling of innovation.
In this way, they can undermine the efficiency and fairness of
the market, leaving consumers with little choice to obtain a
reasonable quality of service.
 Art. 6 C&CPL stipulates that “Any form of agreements,
decisions and concerted practices which have as their object
the undermining, prevention, restrictions or distortion of
competition shall be prohibited.”
 And art. 11 of the C&CPL stipulates that “Enterprises must
refrain from the acts or behaviours which limit access to
markets or otherwise unduly restrain competition or have
adverse effect on trade or the economy in general.”
 Such acts and behaviours are the following:
1° limiting the production of goods or services for the market to
the prejudice of consumers;
2° as a party to an agreement, makes the conclusion of such
agreement subject to acceptance by another party or
supplementary obligations which, by their nature or according
to commercial usage, have no connection with the subject of the
agreement;
3° requiring a supplier or consumer not to deal with a
competitor;
4° refusing to supply goods to a competitor when supplying
those goods is economically feasible;
5° selling goods or services on condition that the
consumer purchases separate goods or services
unrelated to a contract or forcing a consumer to accept a
condition unrelated to the object of a contract;
6° selling goods or services below their marginal or
average variable cost;
7° buying-up a scarce supply of intermediate goods or
resources required by a competitor;
8° engaging in any business activity that results in the
exploitation of its customers or suppliers so as to
frustrate the benefits expected from the market.
Anti-competition practices include any form of
agreements, decisions by associations of enterprises and
concerted practices which have as their object the
undermining, prevention, restrictions or distortion of
competition.
2.1.1. Agreements
 Anti-competitive agreements under competition law are broadly
classified into two categories, the Anti-competitive Horizontal
Agreement and Anti-competitive Vertical/Agreement.
 Horizontal Agreements are those agreements concluded
between (among) enterprises engaged in identical or similar
trade of goods or services.
 When enterprises collude amongst each other to distort
competition in the markets, such agreement is presumed to have
an appreciable adverse effect on competition.
 The following are the four categories of such agreements:
• agreement to fix price;
• agreement to limit production and/or supply;
• agreement to allocate markets;
• bid rigging or collusive bidding.
 Vertical agreements are agreements between parties at
different levels of the supply chain (for example, between a
manufacturer and distributor, or distributor and retailer).
 An example is an exclusive dealing agreement between a
supplier and a retailer, whereby the retailer agrees to only
sell the supplier's products.

 An agreement has a wide meaning and covers agreements

whether written or oral.
 It is not necessary that there be a physical meeting of the
parties for an agreement to be reached: an exchange of
letters or telephone calls may be sufficient.
 The fact that a party may have played only a limited part in the
setting up of the agreement, or may not be fully committed to
its implementation, or may have participated only under
pressure from other parties does not mean that it is not party
to the agreement (although these facts may be taken into
account in deciding the level of any financial penalty).
2.1.2. Decisions by business associations of enterprises
 One of the cases that arouses the most concern from an
antitrust standpoint involves decisions and
recommendations by business associations that affect key
aspects of commercial activity and are addressed to their
member companies or to some other operator in the
market.
 Trade associations are the most common form of
associations of enterprises, but the provisions are not
limited to any particular type of association.
 A decision by a trade association may include, for
example, regulations governing the association
(statute/articles of association); recommendations issued
by the association and the decision to form the association
itself or other activities.
 These decisions include setting prices, dividing markets,
or defining relevant commercial conditions.
 In a competitive market, companies must be able to set
their commercial and pricing policies autonomously.
 Therefore, business associations must refrain from
making any decision or recommendation that serves to
reduce or eliminate that autonomy of their member
companies
2.1.3. Concerted practices
 Prohibition applies to concerted practices as well as to
agreements.
 The boundary between the two concepts, however, is
imprecise. The key difference is that a concerted practice may
exist where there is informal co-operation without any formal
agreement or decision.
 The concept of concerted practices refers to undertakings that
knowingly engage in collusive behaviour to reduce uncertainty
in the market.
 In contrast to an agreement, such collusive behaviour does not
require the participants to adhere to a common plan that
defines their actions in the market.
 In considering if a concerted practice exists, one will need to
establish that the parties, even if they did not enter into an
agreement, knowingly had an implicit cooperation between
them for the risks of competition.
 A concerted practice has the purpose of harming
competition where commercially sensitive information,
such as an undertaking's planned future pricing or
capacity, is exchanged between actual or potential
competitors, and the recipient of the information acts, or
intends to act on that information, which may lead to a
modification of the normal conditions of the market.
2.1.3.1. Factors for the establishment of a concerted
practice
 The following are factors of a concerted practice:
 Whether the parties knowingly entered into practical co-
operation.
 Whether behaviour in the market is influenced as a result of
direct or indirect contact between enterprises.
 Whether parallel behaviour is a result of contact between
enterprises leading to conditions of competition which do
not correspond to normal conditions of the market.
 The structure of the relevant market and the nature of the
product involved.
 The number of enterprises in the market and, where there
are only a few enterprises, whether they have similar cost
structures and outputs.
 Both the associations and the officers that represent
them must be mindful that the messages they issue in
the form of recommendations (a declaration of
intentions in the press, for example) may be unlawful
if they are likely to unify the behaviour of their
members and that of other parties in a way that alters
the normal operation of the market.
 Whether such practices are anti-competitive is highly
dependent on many other circumstances and
therefore, they should not be regarded as
automatically anti-competitive or prohibited.
 The following are illustrated types of practices that might
be considered anti-competitive.
(1)Exclusive supply dealing arrangements
 A supplier agrees to supply only one retailor, usually in a
certain geographical area. The retailor in turn agrees not to
stock or handle products of the suppliers’ competitors and
perhaps not to compete with other customers of his
supplier in their exclusive territories.
(2) Exclusive purchasing contracts
 A customer agrees to buy commodities exclusively from a
single supplier. Contracts which do not specify exclusivity
but require the customer to buy a specified proportion of
his commodities or even a specified quantity in a period
may have anti-competitive effects.
3)Restrictive terms
 These occur in contracts which prevent or restrict the customer
from dealing with the suppliers competitors.
(4) Selective distribution systems
 A supplier will deal with only a certain number of distributors
or only those which can satisfy criteria he lays down on such
matters.
(5) Tie-ins
 A tie-in exists when the supplier of one product or service
insists that the customer must buy all or part of his
requirements or some other product or service from the
supplier.
 It may be convenient to customers to buy several items from
one supplier and there may be cost savings from tie-ins.
However, sometimes the customer is required as a condition of
supply of certain items in the range to buy all (or more of) the
items in the range.
 This may restrict competition between the supplier and his
competitors who offer a more limited number of items.
(6) Restrictions on the supply of parts or other inputs required by
competitors
 Another category of practice can occur if vertically integrated firms refuse
to supply items needed by competitors who are not engaged in the
complete production process or may supply them only at prices which
make it difficult for the competitor to sell the end product at a competitive
price.
 Note this list is not exhaustive .

 Read these cases:

 Judgement of Kenyan Competition Tribunal : CASE No. CT/001, East
African Tea Trade Association v Competition Authority of Kenya, 2017.
 Judgment of EU Court of Justice: Case C-286/13, P Dole Food Company
and Dole Fresh Fruit Europe v Commission, 2015.
 Judgment of EU Court of Justice: Case C- 67/13, P Groupement des cartes
bancaires (“CB”) vs European Commission, 2014.
 Judgment of EU Court of Justice: Case C-8/08, T-Mobile Netherlands and
Others vs Raad van bestuur van de Nederlandse Mededingingsautoriteit, ,
2009.
Chapter 3. Dominant enterprise
 A dominant enterprise is an enterprise which enjoys, either
alone or in partnership with another enterprise, a dominant
position on the market without any other obstacle from either
other persons or companies that are or can get involved in
competition.
Dominant position
 Generally, a Dominant Position refers to a position when
something or someone is in a superior position as compared to
others contingent on certain factors.
 In competition law, Dominance position refers to a position of strength which
enables an enterprise to operate independently of competitive force in the
relevant market or to affect its competitors or consumers in its favour.
 Article 2 (10°) C&CP Law defines a dominant position as a
situation of a company that exerts a major influence, sometimes
abusive, in the control of a corporation or of a market.
 How to determine a dominant position: An enterprise is
more likely to be dominant with a high market share in a
concentrated market and where scope for expansion by rivals is
limited and entry barriers are very high.
 Dominant position of an enterprise itself is not prohibited;
however, if the enterprise by virtue of having dominant
position in the relevant market abuses its dominance, then the
same stands prohibited.
 Abuse of dominant position impedes fair competition between
firms, exploits consumers and makes it difficult for the other
players in the market to compete with the dominant
undertaking.
 Abuse of dominant position covers:
 Imposing unfair condition or price;

 Limiting production/market or technical or scientific

development;
 Denying market access;
  Making conclusion of contracts subject to conditions, having
no nexus with such contracts; and
 Possessing dominant position in one relevant market to gain
advantages in another relevant market.

 How to determine a dominant position:

ttps://www.youtube.com/watch?v=9IX6zAXVgcI

 Judgment of EU Court of Justice: Case C-23/14 Post

Danmark A/S vs. Konkurrencerådet, 2015.
3.1. Abuse of the dominant position: Test for determining
abuse of a dominant position
 The tests applied have two common elements:
a) whether an undertaking is dominant in a relevant market;
and, if so,
b) whether it is abusing that dominant position.
3.2. Test for determining a dominant position of an
enterprise
 In determining whether an enterprise is in a dominant
position, consideration shall be given to the following (Art. 8
C&CPL):
1. relevant market defined in terms of both its product and
geographic dimensions;
2. level of actual or potential competition in terms of number of
competitors, production capacity and demand;
3. barriers to the entry of competitors;
4. background of competition and rivalry between competitors
in the sector of activity.
 The first test raises two questions which are considered
below:
(i) the definition of the market in which the enterprise is
alleged to be dominant (the relevant market); and
(ii) whether it is dominant within that market.

 In addition, in determining whether Art. 9 C&CPL

prohibition apply, it is necessary to consider in which
territory the dominant position is held.
Market definition
 https://www.youtube.com/watch?v=nOepwLy0rMk
(Market definition – demand side)
 https://www.youtube.com/watch?v=0cN9gkrUuVw
(Digital challenges)
 Before assessing whether an enterprise is dominant, the
relevant market must be determined. This relevant
market will have two dimensions:
 the relevant goods or services (the product market), and
 the geographic extent of the market (the geographic
market).
 The product market
 The market is determined by taking the product (or service)
relevant to the investigation - the focal product - and looking at
the closest substitute products, usually those products to which
consumers would switch, if the price of the focal product rose.
 These substitute products are included in the same market as
the focal product if customers would switch to them in
sufficient volumes in response to the hypothetical situation
where the price of the focal product is sustained significantly
above competitive levels.
 The geographic market
Similar methods are used to define the geographic market.
Usually, one considers an area in which the focal product was sold
as a candidate for the relevant geographic market.
 Then consideration would be made whether, in response to the
hypothetical situation where the price of the focal product in
that area was being sustained significantly above competitive
levels, customers would switch a sufficient volume of purchases
to the same products sold in other areas.
 If so, these other areas will be included in the relevant
geographic market.
 “Hypothetical monopolist test” operates by considering
whether a hypothetical monopolist (i.e. a single firm that
controlled all the products considered part of the relevant
market) could profitably undertake “a small but significant,
non-transitory, increase in price”.
 Supply side substitution might also occur whereby suppliers in
other areas would quickly (for example, within one year), and
without substantial investment, supply the candidate market in
response to the higher prices there.
 The geographic market may be national (i.e. Rwanda), smaller
than national (e.g. local or regional), wider than national (e.g.
East African Community) or even worldwide.
3.4. SSNIP Test
 This test is an American import called the 'Small, but Significant,
Non-transitory Increase in Price' (SSNIP) and is a hypothetical
monopolist test that ascertains levels of demand substitution, which
are the instances when consumers will transfer allegiance to another
product as a result of price increases.
 If this occurs where there is a price increase of 5-10% and for at least 12
months, it is concluded that the product and the substitution are part
of the same market.
 SSNIP test defines the relevant market by determining whether a
given increase in product prices would be profitable for a monopolist
in the candidate market.
3.5. Assessing dominance
A dominant market position is defined as:
'... a position of economic strength enjoyed by an undertaking which
enables it to prevent effective competition being maintained on the
relevant market by affording it the power to behave to an appreciable
extent independently of its competitors, customers and ultimately of its
consumers.'
 An enterprise will not be dominant unless it has
substantial market power. Market power arises where an
enterprise does not face sufficiently strong competitive
pressure.
 Market power can be thought of as the ability profitably to
sustain prices above competitive levels or to restrict output
or quality below competitive levels.
 An enterprise with market power might also have the
ability and incentive to harm the process of competition in
other ways, for example by weakening existing
competition, raising entry barriers or slowing innovation.
 In assessing whether an enterprise is dominant, one
considers whether that undertaking faces constraints on
its ability to behave independently.
 The most important constraints are existing competition
and potential competition.
 Other factors, such as the countervailing influence of
powerful buyers, or regulation, are sometimes relevant as
well.
3.6.1. Existing competition
 Existing competition refers to competition from enterprises
already in the relevant market, to whom consumers might
switch if the alleged dominant enterprise sustained prices
above competitive levels.
 The market shares of competitors in the relevant market are
one measure of the competitive constraint from existing
competitors.
3.6.2. Market shares
 An enterprises market share is an important factor in assessing
dominance but does not, on its own, determine whether an
enterprise is dominant.
 For example, it is also necessary to consider the position of
other enterprises operating in the same market and how
market shares have changed over time.
 An enterprise is more likely to be dominant if its competitors
enjoy relatively weak positions or if it has enjoyed a high and
stable market share.
3.6.3. Potential competition
 Potential competition refers to the possibility that
enterprises would enter the relevant market and gain
market share at the expense of an alleged dominant
enterprise that sustained prices above competitive levels.
 The strength of potential competition is affected by
barriers to entry.
Other factors
3.6.4. Abuse of powerful buyers
 The ability of an alleged dominant supplier to exercise market power
may be diminished by the existence of powerful buyers.
 Nevertheless, the existence of powerful buyers in a relevant market
would not, in itself, preclude from finding a supplier to be dominant
in that market.

 Judgement of Kenyan Competition Tribunal: Case no. CT/006/2020,

Majid Al Futtaim Hypermarkets Ltd vs. the CAK and Orchards Ltd,
2020.

3.6.5. Economic regulation

 Economic regulation is a further relevant factor when assessing
market power in industry sectors where, for example, prices and/or
service levels are subject to controls by the government or an industry
sector regulator.
 In this situation an enterprise may still be considered to be
dominant. Economic regulation may, however, limit the extent to
which that dominant position may be abused.
3.6.6. Intellectual property rights (IPRs)
 The fact that intellectual property laws grant exclusive rights of
exploitation and the idea of dominance position.
 The intellectual property laws and the antitrust laws are
complementary and share the common purpose of promoting
innovation and enhancing consumer welfare and contributes to
pursue « workable competition »
 IP rights limitations to copy aim at promoting dynamic competition by providing
incentives for innovation and its dissemination and commercialization by
establishing enforceable property rights for the creators of new and useful
products.
 The antitrust laws promote innovation and consumer welfare by prohibiting
certain actions that may harm competition with respect to either existing or new
ways of serving consumers.
 Intellectual property is inherently pro-competitive as it ensures
the protection of differentiated, intangible business assets.
 Without IP, less efficient manufacturers and service providers
would try to lure clients by copying the goods and services of
more efficient competitors. The latter would lose any incentive
to improve or to offer new products and services and society as
a whole would lose.
3.6.7. Collective dominance
 A dominant position need not be held by a single
enterprise. Separate enterprises may be found to hold a
dominant position together where certain conditions are
met.
 A dominant position may be held collectively when two or
more legally independent enterprises are linked in such a
way that they adopt a common policy on the market.
 Two or more independent undertakings, possibly through
established economic links, hold a dominant position in
the market together while still being independent of each
other.
 Art. 19 C&CPL provides the procedure by which the
merger of enterprises has to be investigated:
 When the Regulatory Body is required to consider a
merger, it shall initially determine whether or not the
merger is likely to prevent or undermine competition.
 If such a merger may prevent or undermine competition,
the Regulatory Body shall determine whether:
1° the merger is likely to result in any technological efficiency
or other competitive gains which may be greater than the
effects of any prevention of competition that result from the
merger and which would not likely be obtained if the merger is
prevented;
2° the merger can be justified on substantial public interest
grounds.
3.6.8. Territorial scope
 In determining whether Art. 9 C&CPL prohibition applies,
it is necessary to consider the territory within which a
dominant position is held.
 For application of Art. 9 C&CPL, the dominant position
must be held within Rwanda or any part of it.
 A dominant position held within Rwanda or any part of it
may also be a dominant position within a substantial part of
the common market.
 In particular, where a dominant position is held within
Rwanda as a whole, it will most likely also be a dominant
position within a substantial part of the common market.
 Common market is defined by Art. 1 of the EAC Treaty as
“The Partner States' markets integrated into a single
market in which there is free movement of capital, labor,
goods and services.”
 The COMESA competition law is contained in Chapter VI,
Article 55(1) of the Treaty establishing the Common
Market for Eastern and Southern Africa (the “COMESA
Treaty”) which reads: “The Member States agree that any
practice which negates the objective of free and liberalised
trade shall be prohibited. To this end, the Member States
agree to prohibit any agreement between undertakings or
concerted practice which has as its objective or effect the
prevention, restriction or distortion of competition within
the Common Market.”
3.7. Abuse of a dominant position
https://www.youtube.com/watch?v=9IX6zAXVgcI
(Abuse of a dominant position)
Resale price maintenance
The resale price maintenance is the practice by which
a manufacturer establishes a fixed or minimum price
for the resale of product by retailers or distributors.
According to art. 10 C&CPL, the practice of resale price
maintenance is prohibited, but a supplier or producer
may recommend a minimum resale price to the seller,
which price is proposed but subject to change.
https://www.youtube.com/watch?v=hObZs6m2jhw
(resale price maintenance)
3.7.1. Concept of abuse
 Abuse of a dominant position occurs where a firm holds a
position of such economic strength that allows it to operate in a
market without being significantly affected by competition and
it engages in conduct that is likely to impede the development
or maintenance of effective competition.
 The abuse of dominant position impedes fair competition
between the firms, exploits consumers, and makes it difficult
for other players to compete with the dominant enterprise on
merit. The Dominance itself is not considered as anti-
competitive but its abuse rather.
 In general, it is considered that the likely effect of a dominant
enterprises conduct on customers and on the process of
competition is more important to the determination of an
abuse than the specific form of the conduct in question.
 Thus, a conduct may be abusive when, through the effects of
conduct on the competitive process, it adversely affects
consumers directly (for example, through the prices charged)
or indirectly (for example, conduct which reduces the intensity
of existing competition or potential competition).
 Art. 9 lists broad categories of business behaviour, within
which particular examples of abusive conduct are most likely
to be found.
3.7.2. Categories of abuse
 Abusive conduct generally falls into one or both of the
following categories:
 Conduct which exploits customers or suppliers (for example,
excessively high prices), or
 Conduct which amounts to exclusionary behaviour, because it
removes or weakens competition from existing competitors, or
establishes or strengthens barriers of entry to the market,
thereby removing or weakening potential competition.
 Exclusionary behaviour may include excessively low prices
and certain excessive discount schemes, where its (likely)
effect is to foreclose a market, as well as vertical restraints
or refusals to supply where these (are likely to) foreclose
markets or dampen competition.
 However, whatever the form of the behaviour in question,
it’s likely effect on competition will depend on the
circumstances at hand.
3.7.3. Factors considered in establishing whether a
dominant position is being abused
Art. 9 C&CPL stipulates that any enterprise of a dominant
position is deemed to harm competition if it;
1° restricts, or likely to restrict, the entry of any enterprise in any
market;
2° prevents or deters, or is likely to prevent or deter, any
enterprise from engaging in competition in the market;
3° eliminates or removes or is likely to eliminate or remove, any
enterprise from the market;
4° directly or indirectly imposes unfair purchase or selling prices
or other restrictive practices;
5° limits the production of goods or services for a market to the
prejudice of consumers;
6° as a party to an agreement makes the conclusion of
such agreement subject to acceptance by another party
or supplementary obligations which, by their nature or
according to commercial usage, have no connection with
the subject of the agreement;
7° engages in any business activity that results in the
exploitation of its customers or suppliers, so as to
frustrate the benefits expected from competition in the
market.
3.7.4. Acts restraining of limiting competition
 Art. 11 C&CPL stipulates that enterprises must refrain from
the acts or behaviours which limit access to markets or
otherwise unduly restrain competition or have adverse
effect on trade or the economy in general.
 Such acts and behaviours are the following:
 Limiting the production of goods or services for the
market to the prejudice of consumers;
 As a party to an agreement makes the conclusion of such
agreement subject to acceptance by another party or
supplementary obligations which, by their nature or
according to commercial usage, have no connection with
the subject of the agreement;
 Requiring a supplier or consumer not to deal with a
competitor;
 Refusing to supply goods to a competitor when
supplying those goods is economically feasible;
 Selling goods or services on condition that the consumer
purchases separate goods or services unrelated to a
contract or forcing a consumer to accept a condition
unrelated to the object of a contract;
 Selling goods or services below their marginal or average
variable cost;
 Buying-up a scarce supply of intermediate goods or
resources required by a competitor;
 Engaging in any business activity that results in the
exploitation of its customers or suppliers so as to
frustrate the benefits expected from the market.
3.7.5. Acts of unfair competition
 Any act or practice that is contrary to honest practices in
industrial or commercial matters constitutes an act of
unfair competition.
 An act or practice that implies a breach of legal duties,
including any infringement of or failure to comply with
legal provisions or standards, is regarded as contrary to
honest practices when its purpose or consequence is to
obtain an unfair advantage over competitors.
 Any natural person or legal entity damaged or likely to
be damaged by an act of unfair competition is entitled to
the remedies.
 The following constitute acts of unfair competition:
1. Causing Confusion with Respect to Another’s Enterprise
or Activities
 Any deceptive act or practice in the course of trade that
causes, or is likely to cause, confusion with respect to another
person or his activities, in particular with regard to the
products or services offered by such person;
2. Damaging Another’s Reputation
 Any deceptive act or practice in the course of trade that
damages, or is likely to damage, the reputation of another
undertaking (person) constitute an act of unfair
competition, regardless of whether such act or practice causes
confusion;
 Damaging another person’s reputation may, in particular,
result from the dilution (weakening) of the reputation
attached for example to a mark, a trade name; a business
identifier other than a mark or a trade name; appearance of a
product; a celebrity or a well-known fictional character etc.
3. Misleading the Public
 Any act or practice in the course of trade that intentionally
misleads, or is likely to mislead the public with respect to a
person or his activities, in particular, the products or
services offered by such person;
 Misleading may arise out of advertising or promotion and
may occur, in particular, with respect to:
(i.) the manufacturing process of a product;
(ii.) the suitability of a product or service for a particular
purpose;
(iii.) the quality, origin, provenance, quantity or other
characteristics of products or services;
(iv.) the conditions on which products or services are offered
or provided;
4. Discrediting Another’s Enterprise or its Activities
 Any false or unjustified allegation in the course of trade that
discredits, or is likely to discredit can be qualified as an unfair
competition.
5. Unfair Competition in Respect of Secret Information
 Any act or practice in the course of trade that results in the
disclosure, acquisition or use by others of secret information
without the consent of the person lawfully in control of that
information (hereinafter referred to as “the rightful holder”)
and in a manner contrary to honest commercial practices.
 Disclosure, acquisition or use of secret information by others
without the consent of the rightful holder may, in particular,
result from:
(i.) industrial or commercial espionage;
(ii.) breach of contract;
(iii.) abuse of trust.
3.7.6. Grounds for authorising an enterprise to
take part in agreements of an anti-competitive
nature
 Art. 14 C&CPL stipulates that the regulatory body may,
upon request by or on behalf of an enterprise, grant an
authorisation to the enterprise to take part in
agreements, practices, arrangements, understandings or
any other category, even if they are anti-competitive:
 If the Regulatory Body determines that there are public
benefits outweighing the anti-competitive detriment of
the contract, arrangement or understanding;
 If the authorisation is meant to cover other persons
who subsequently become parties to the contract or
understanding, as long as that constitutes the purpose
of the authorisation.
Chapter 4: Restrictive practices of competition (art. 7)
 A restrictive trade practice is an act performed against
competitors with the effect of reducing or eliminating their
opportunities to participate in a market. It is also an act by
suppliers to reduce or eliminate the ability of consumers to
access desired goods or services.
 These are practices that are intended to restrict competition by
object or effect:
1. Agreements, whether written, non-written or any other form
of agreement designed to fix prices, hinder or prevent the sale,
supply or purchase of goods or services between persons, or
restrict the terms and conditions of sale or supply or purchase
between persons engaged in the sale of purchased goods or
services;
2. Limit or control the production of goods, markets, technical
development or investment;
3. Share markets or sources of supply of goods;
4. Apply in respect of the trading partners of dissimilar
(different) conditions to equivalent transactions thereby
placing them at a competitive disadvantage;
5. Collusive (coalition in) tendering and bid-rigging (fraudulent);
6. Limitations to sales and production;
7. Collective boycott (Collective boycott happens when a
collective bargaining group agrees not to supply or buy from a
particular business unless it accepts the group's terms and
conditions).
8. Concerted refusals to supply goods or services to any potential
consumer or not to purchase goods or services from a potential
supplier;
9. Collective denials of access to an arrangement or association
which is crucial to competition.
 Agreements made based on these practices are null and void.
4.1. Directly or indirectly fixing prices
 Price fixing is an agreement between competitors or businesses in a
market to set the price of goods and services. This agreement involves
direct or indirect communication, resulting in prices being set at levels
higher than competitive market conditions would otherwise dictate.
 One example is if two companies who are major producers of a
particular product collude to raise the price of their product above what
competitive market forces would otherwise dictate.
 Price fixing agreement can be ‘direct’ fixing of prices, where there is an
agreement to increase or maintain actual prices. Price fixing activities
can also take the form of ‘indirect’ fixing of prices, for example, where
competitors agree to offer the same discounts or credit terms.
 Price fixing agreements do not have to be in writing, a verbal
understanding at, for instance a trade association meeting or at a social
event, may be sufficient to show that there was a price fixing
agreement.
 It does not matter how the agreement was reached or whether it has
been carried out. What matters is that the competitors have agreed to
collude.
 Price fixing is typically considered to have a negative impact on a
market as it reduces competition, eliminates any incentive to
lower prices, and raises prices for consumers.
 This may also lead to reduced consumer choice and decreased
quality of goods and services.
 Additionally, it can lead to higher profits for the companies
engaging in price fixing, creating an unfair competitive
advantage.
 An agreement whose object is directly or indirectly to fix prices,
or the resale prices of any product or service, infringes
competition law. Such price-fixing agreements, by their very
nature, restrict competition to an appreciable extent.
 There is nothing illegal about competitors actually setting the
same prices or even about them doing so consciously. Indeed, in
a perfectly competitive market, one would expect retailers to sell
their goods at the same prices.
 The offense lies in their setting (or raising or maintaining) prices
by entering into an agreement with one another.
 The agreement, to be a violation, need not set a particular price.
Rather, the law frowns on any agreement that interferes with
competitors’ ability to set their own prices with complete freedom.
 There are two primary types of price fixing: horizontal price fixing
and vertical price fixing. Both types of price fixing can be used to
manipulate the market and limit competition. They are also both
illegal under most antitrust laws and considered to result in harmful
anti-competitive effects.
 Thus, agreements that set price ranges, establish formula for rates of
change in prices, or provide guidelines for competitors’ responses to
changes in their cost structures are all violations, even though they
neither establish a precise common price nor eliminate all possible
price competition.
 Horizontal price-fixing
 Horizontal price-fixing is an agreement between competitors to set
or fix prices at a certain level. This type of price-fixing typically
occurs when companies in the same market engage in discussions of
negotiations and agree amongst themselves to fix the minimum
price at which certain products may be sold.
 Vertical minimum price fixing
 Vertical minimum price fixing occurs when a manufacturer tells its
dealer or distributor the minimum price at which it must resell the
goods. Minimum resale price-fixing is often termed resale price
maintenance.
 For example, if a manufacturer of a popular brand of sneakers tells
retailers that they can only sell the sneakers at a certain price, this is
vertical price-fixing. The manufacturer is trying to control the resale
price of the sneakers and eliminate price competition among
retailers. This can lead to higher prices for consumers and harm the
economy.
 Direct agreements to maintain resale prices are per se illegal in most
states. However, it is possible for manufacturers to achieve de facto
resale price maintenance through indirect means, for example, by
refusing to deal with retailers who discount their goods.
 Maximum vertical price-fixing is at least prima facie pro-competitive,
since it appears designed to keep prices to consumers low. It is
therefore generally judged on a case-by-case basis, with the court
balancing the pro- and anticompetitive effects of the agreement in
question against each other.
 There are many ways in which prices can be fixed. Price fixing
may involve fixing either the price itself or the components of a
price, setting a minimum price below which prices are not to be
reduced, establishing the amount or percentage by which prices
are to be increased, or establishing a range outside which prices
are not to move.
 Price fixing may also take the form of an agreement to restrict
price competition. This will include, for example, an agreement
to adhere to published price lists or not to quote a price without
consulting potential competitors, or not to charge less than any
other price in the market.
 An agreement may restrict price competition even if it does not
entirely eliminate it. Competition may, for example, remain in
the ability to grant discounts or special deals on a published list
price or ruling price.
 An agreement may also have the object of fixing prices while
only indirectly affecting the price to be charged. It may for
example cover the discounts or allowances to be granted,
transport charges, payments for additional services or terms of
guarantees.
 The agreement may relate to the charges or allowances
quoted themselves, to the ranges within which they fall,
or to the formulae by which additional terms are to be
calculated.
 As observed, price fixing issues are not limited to
agreements between competing enterprises. They can
also arise between enterprises operating at different
levels in the supply chain, where an agreement directly or
indirectly has the object of restricting a buyer’s ability to
determine its resale price. This is the vertical price-
fixing.
4.2. Agreements to fix trading conditions
 Enterprises may agree to regulate the terms and conditions on
which goods or services are to be supplied, in addition to
prices.
4.3. Agreements to share markets
 In a market sharing agreement competitors divide up markets
in various ways, such as territory (geographical area ) or size or
type of customer (e.g. business/non-business) or in some other
way, and agree to sell only to their allotted segment of the
market.
 As a result they do not compete for each other’s allotted
market. Customers are affected as they would not be able to
shop around for the best deals.
 This may be as well as or instead of agreeing on the prices to be
charged, especially where the product is reasonably
standardised.
 Where the object of the agreement is to share markets in this
way, it will almost invariably infringe Article 6.
 Such market-sharing agreements, by their very nature,
restrict competition to an appreciable extent.
 There can be agreements, however, which have the effect
(rather than the object) of sharing the market to some
degree as a consequence of the main object of the
agreement.
 Parties may agree, for example, each to specialise in the
manufacture of certain products in a range, or of certain
components of a product, in order to be able to produce in
longer runs and therefore more efficiently.
 Such an agreement may fall within Article 6 prohibition
where there is, or is likely to be, an appreciable effect on
competition.
4.4. Agreements to limit or control production or
investment
 An agreement whose object is to limit or control
production will almost invariably infringe Rwanda
competition law prohibition.
 Such an agreement may be the way in which prices are
fixed, or it may relate to production levels, or it may be
intended to deal with structural overcapacity.
 In some cases, it will be linked to other agreements which
may affect competition.
 Competitive pressures may be reduced if enterprises in an
industry agree to limit investment or at least to coordinate
future investment plans.
 Any agreement whose object is to limit or control
investment will, by its very nature, restrict competition to
an appreciable extent.
4.5. Collusive tendering (‘bid-rigging’)
 Tendering procedures are designed to provide competition
in areas where it might otherwise be absent. An essential
feature of the system is that prospective suppliers prepare
and submit tenders or bids independently.
 Bid rigging occurs when competitors agree on who should
win a tender. In order to support the cartel member who
has been designated to ‘win’ the tender , other cartel
members may refrain from bidding, withdraw their bids,
or submit bids with higher prices or unacceptable terms.
 The cartel members may agree amongst themselves to
take turns to be the designated ‘winner’ in successive
biddings, or to reward the ‘supporters’ of the winning bid,
for example, by giving sub-contracts to them.
 As a result of bid rigging, the party inviting the tender is
likely to pay more than it would if the tender was
competitive.
 Thus, bid-rigging agreements, by their very nature,
restrict competition to an appreciable extent.
4.6. Joint purchasing/selling
 Joint purchasing agreements are agreements under which two
or more companies (and indeed, often a significant number of
companies/ purchasers) agree to jointly purchase all or part of
their product requirements, only through the agreed
arrangements.
 Joint purchasing agreements can be concluded between
undertakings competing on the product purchasing markets.
 An example of one type of agreement which might be made
between purchasers is an agreement as to those with whom they
will deal.
 Such cooperation between competing buyers can significantly
reduce competition by the creation of a buyer power.
 Such an arrangement may fall within Rwanda competition law
prohibition if it has an appreciable effect on competition.
 Joint purchasing/selling may be based on horizontal or
vertical agreements. Thus, it may potentially arise in
agreements between sellers, in particular where sellers
agree to boycott certain customers. It may also be
between suppliers who agree to supply to a single or
selected customer.
 This type of agreement may have an appreciable effect
on competition.
4.7. Information sharing
 Exchanges (sharing) of information occur when undertakings
reciprocally provide or receive fact reports or details about
business valuable information.
 Generally, competition laws recognize that the exchange of
information between competitors may be beneficial. As a
general principle, the more informed customers are, the more
effective competition is likely to be and so making information
publicly available to customers does not usually harm
competition.
 In the normal course of business, enterprises exchange
information on a variety of matters legitimately and with no
risk to the competitive process.
 Indeed, competition may be enhanced by the sharing of
information, for example, on new technologies or market
opportunities.
 There are therefore circumstances where there is no objection
to the exchange of information, even between competitors,
and whether or not under the support of a trade association.
 The exchange of information may however have an adverse
effect on competition where it serves to reduce or remove
uncertainties inherent in the process of competition.
 The fact that the information could have been obtained from
other sources is not necessarily relevant.
 Whether or not exchange of information has an appreciable
effect on competition will depend on the circumstances of
each individual case: The market characteristics, the type of
information and the way in which such information is
exchanged.
 There is more likely to be an appreciable effect on competition
where the exchange of information is limited to certain
participating enterprises to the exclusion of their competitors
and consumers.
 A competitive sensitive information refers to an information
that is important to rivalry between competing firms, which
reduces strategic uncertainty in the market, making it easier for
competitors to predict one another’s behaviour and adjust their
own. It is information likely to have an appreciable impact on
one or more of the parameters of competition.
 There is no exhaustive or definitive list of the types of
information that can or cannot be shared with competitors. It
can be for example on price, output, turnover, risks, product
quality, product variety or innovation etc.).
 The form of the exchange does not matter: Competitively
sensitive information can be exchanged privately (e.g., in a
meeting), publicly (via published material) or through a third
party, such as a trade association. No written or express
agreement is required.
 There is no need for bilateral exchanges – one-way
communication is enough: The mere attendance at a meeting
where a rival discloses its future pricing plans is enough, even if
there was no response from another attendee and even where
there is no explicit agreement between the attendees.
 The impact on the market is presumed: If you receive
unsolicited competitively sensitive information from a
competitor – whether in an email or a single meeting – it
is presumed that you have accepted and acted on the
information in breach of competition law, unless there is
a clear statement that the information is not wanted or
rejected.
4.7.1. Exchange of price information
 The exchange of information on prices diminish competition which
would otherwise be present between the enterprises.
 This will be the case whether the information exchanged relates
directly to the prices charged or to the elements of a pricing policy,
for example discounts, costs, terms of trade and rates etc.
 The more recent or current the exchanged information is, the more
likely that exchange will have an appreciable effect on competition.
 The circulation of purely historical information or the collation of
price trends is therefore unlikely to have an appreciable effect on
competition, for example, where the exchange forms part of a scheme
which is intended to spread best industrial practice.
 Exchange of information that is aggregated (generalized), and which
cannot be disaggregated is also unlikely to have an appreciable effect
on competition.
4.7.2. Exchange of non-price information
 The exchange of information on matters other than price may
have an appreciable effect on competition only depending on
the type of information exchanged and the structure of the
market to which it relates.
 The exchange of aggregated statistical data, market research,
and general industry studies for example are unlikely to have an
appreciable effect on competition, since exchange of such
information is unlikely to reduce individual enterprises
commercial and competitive independence.
 In general, the exchange of information on output and sales
should not affect competition provided that it is aggregated or,
if it enables participants to identify individual enterprises
competitive behaviour, provided that it is sufficiently historic.
 In such circumstances, it is unlikely that an agreement to
exchange such information would influence the participants’
competitive market behaviour.
 There may however be an appreciable effect on
competition if the information exchanged is current or
recent or concerns future plans, and if it can be ascribed
to particular undertakings, whether because it is broken
down in this way or because it can be disaggregated.
4.8. Advertising
 Restrictions on advertising have the potential to restrict
competition.
 Whether the effect is appreciable depends on the
purpose and nature of the restriction, and on the market
in which it is to apply.
 Decisions aimed at limiting the misleading
advertisement, or at ensuring that advertising is legal,
truthful and decent are unlikely to have an appreciable
adverse effect on competition.
4.9. Standardisation agreements
 An agreement on technical or design standards may lead
to an improvement in production by raising quality, or it
may promote technical or economic progress by reducing
waste and consumers’ search costs.
 Some such agreements will, however, be likely to infringe
Article 6 prohibition if they are, in effect, a means of
limiting competition from other sources, for example by
raising entry barriers for those which do not meet the
standards.
 Standardisation agreements which prevent the parties
from developing alternative standards or products that do
not comply with the agreed standard may also infringe
Article 6 prohibition.
 Consumer protection law
Introduction
 When we buy the things that we need in our daily lives,
there are a large number of laws and principles underlying
these routine transactions.
 Consumer protection law is the branch of law which
protects consumers against breach of their fundamental
rights in their daily transactions involving goods and
services.
  Rights of consumers
 Right to safety
 Consumers are entitled to healthy and safe products.
 The right to safety refers to the right to be protected from the
marketing and sale of products hazardous to human life and
property.
 A consumer has a right to receive or consume products and
services that adequately meet the set health and safety
standards.
 Consumers have the right to be protected against the
marketing of goods which are hazardous to life and health.
 Food additives and colours, dangerous toys, flammable fabrics,
unsafe appliances are examples of such goods.
 Consumers expect purchased items to be safe when used
correctly or as directed.
 According to art. 47 C&CPL, an enterprise shall not supply
goods that are intended to be used or which are likely to be
used by a consumer if:
1° those goods do not comply with prescribed consumer product
safety standards;
2° there are regulations declaring that such goods may be unsafe;
3° there are laws and other regulations imposing a ban on such
goods.
 A person who suffers damage by reason of non compliance
with these provisions by an enterprise shall be deemed to have
suffered the loss or damage caused by the supplier.
 Right to information
 Businesses are required by law to provide certain information
to consumers regarding the quality, quantity, potency, purity,
standard and the price of goods and services.
 The purpose of this right is to enable them make an informed
choice and protect them against dishonest or misleading
information , false and misleading claims or information in
advertising, labeling, or marketing practices.
 Art. 33 of the C&CPL provides:
“No later than the time of the conclusion of a sale contract, the seller
must provide the consumer with correct and necessary information on
the characteristics of the product or service and conditions of contract
considering the need for information expressed by the consumer and
given the reported use by the consumer or reasonably foreseeable use.”
 In all enterprises, fairs and exhibitions, traders must display
prices to consumers.
 The price must be displayed by labelling on the product or the
package, on a placard fixed on the product or close to it or on a
single notice board.
 However, the display of prices on a single notice board can only
be resorted to where putting the price on the commodity or on
the label of the product is impossible.
 The price, in Rwandan francs, must be written, in Arabic
numerals and in legible characters, all taxes inclusive. (art. 36)
 Right to choose
 The right to choose means the right to be assured, wherever
possible of access to variety of goods and services at competitive
price. Free competition and wide variety enable consumers to
choose the best goods.
 Right to quality of product/Service
 A consumer has a right to be provided with high quality and
reliable products and services.
 According to art. 48 C&CPL, “where an enterprise has supplied
on the market unsafe or defective goods, potentially harmful to
human health, which do not meet quality standards or
consumer expectations, the Regulatory Body shall take the
following appropriate actions to protect the consumer:
1° to remove those goods from the market;
2° to provide necessary information on those goods to all people
or a group of people;
3° to repair goods except when it appears on the notice they may
harm the health;
4° to substitute the goods;
5° to pay the price for such goods;
 6° to reduce the price if the commodity cannot cause harm;
7° to be sued before courts of law.”
 Right to be heard
 Consumers need to be assured that their interests will
receive due consideration at appropriate forums.
 Consumers have the right to let businesses know if they are
unhappy with products and services.
 These complaints are usually made in customer service
departments. This right also ensures consumers that
government officials will consider consumer concerns and
issues when making public policies.
Right to education
 Consumers have the right to be made aware of their rights
and remedies available to them for redressal of their
grievances. They also have a right to access to education
that will provide the knowledge and skills needed to make
informed consumer decisions
Right to complain/ seek redressal (remedy)
 A consumer has a right to complain and to receive timely
and effective redress at no cost.
 Standing machinery must be provided for quick and
satisfactory redressal of consumer grievances against
unfair trade practices and exploitation by unscrupulous
elements.
 It refers to the right to seek justice against exploitation or unfair
practices. Consumers have the right to return a defective item
or complain about poor service.
 They also have a right to get their money back, to have the
product replaced or a do-over of the service provided, or to
have the product repaired. It is a consumer’s right to seek a fair
resolution to grievances.
 Right to healthy environment
 Consumers have the right to live in a pollution free
environment. This is necessary to enhance the quality of
human life.
 Right to privacy
 A consumer has a right to privacy, security of private data and
protection against unauthorized use of personal information
and unsolicited communication.
 Prejudice to the consumer (art.34)
 The consumer is prejudiced whenever there is no fairness in the
agreements between the rights and obligations of parties to the
contract.
 Some of the reasons showing that the consumer is prejudiced
are the following:
1° when the consumer accepts contract terms that are not in
writing or are included in another document to which it is not
expressly referred in the conclusion of the contract and of which
he/she had no knowledge prior to its conclusion;
2° if the seller restricts the requirement to meet the commitments
made by his/her servants or agents;
3° when the seller reserves the right to unilaterally change the
terms of the contract;
4° when the seller reserves the sole right to determine if the item
delivered or service provided is consistent or not with the contract
or denies the right to the consumer to intervene in the
interpretation of any term of the contract;
5° when the consumer is constrained to perform its
obligations while, conversely, the seller has not yet fulfilled
his/her obligations to deliver or guarantee the quality of a
good or his/her obligations to provide a service;
6° when the consumer is deprived of his/her right to
compensation for damage in the event of failure by the
seller in any of his/her obligations;
7° when the consumer is deprived of his/her right to request
termination or execution of the contract in case of default by
the seller to fulfill his/her obligations to deliver or guarantee
the quality of a commodity or his/her obligation to provide a
service;
8° when the seller has the discretionary right to terminate
the contract without the consumer being granted the same
right;
9° when the seller reserves the right to retain the security
when he/she terminates the contract ;
10° when it is concluded a contract which does not
provide for the period of validity and termination notice
period.
Prohibited advertising (art. 38)
 Any advertising that may encourage risky behavior
dangerous for health or safety of persons is prohibited.
Comparative advertising
 Comparative advertising shall be the one that
compares goods or services by identifying explicitly or
implicitly, a competitor or goods or services offered by
a competitor or an enterprise without prejudice to the
competition.
 Comparative advertising is permitted if it meets the following
conditions:
1° it must not be misleading or likely to mislead the consumer;
2° it must be for goods or services meeting the same needs or
intended for the same purpose;
3° it must objectively compare one or more characteristics of
goods or services compared.
 Invoicing (art. 40)
 All business transactions the seller has the obligation of
issuing to the buyer an invoice for the sale or the supply of
goods.
 All sales of products from agriculture, animal husbandry,
fisheries and craft products shall be exempted from the
invoicing.
 This exemption does not apply to industrial producers within
the fields referred to above.
 Methods of Consumer Protection
 The following methods can be adopted for protection of
consumers:
 Self-regulation by businesses
 Businesses exist to serve consumers. There is a growing
realisation that businesses should provide good quality
products at reasonable prices.
 Business owners should regulate their behaviour by adopting
just and fair trade practices.
 They should avoid the temptation to make money by cheating
customers.
 Trade associations and chambers of commerce should enforce
discipline among business owners through codes of conduct
and regulations.
 Large businesses have realized that they can prosper and grow
for a long period of time only by giving due importance to
consumers. Socially responsible firms adopt and follow quality
standards.
 Business Associations
 Various business associations frame a set of code of conducts
which lay down guidelines for dealing with customers.
 Consumer Associations
 Consumers themselves should insist on value for money spent
and ensure their rights. The consumer must be well aware
about his rights, responsibilities and relief available to him
under consumer protection laws.
 Consumes should organise and unite by forming consumer
associations.
 Consumerism
 Consumerism is an organised movement of citizens and
Government to strengthen the rights and powers of buyers in
relation to seller.
 Consumerism is a social force aimed at protecting the
consumers by exerting moral and economic pressure on the
business community. It is an organised movement of
consumers.
Legislative measures
 The government of Rwanda has taken several legislative
measures for the protection of consumers which include
but not limited to the enactment of a law on consumer
protection.
 General theory of contracts
 Under Article 2(1) of the Law N°45/2011 of 25/11/2011
governing contracts; a “contract”: is a promise or a set of
promises the performance of which the Law recognizes as
obligation and the breach of which the Law provides a
remedy;
 Furthermore, pursuant to Article 64, contracts made in
accordance with the law shall be binding between
parties.
 Article 41 Competition and Consumer Protection Law
(C&CPL) stipulates that the seller has the obligation to
deliver goods in conformity with the contract.
 The commodity of the consumer shall be presumed to
conform to the contract if:
(1°) it complies with the description given by the seller
and possess the qualities of the commodity which the
seller has held out to the consumer as a sample or
model;
(2°) it is fit for any particular purpose for which the
consumer requires it and which he/she made known to
the seller at the time of the contract and which the seller
has accepted.
  Types of consumer contracts
 Sale and purchase of goods contracts:
 The most common form of consumer contract is the sale and
purchase of goods.
 Protection for consumers in sale and purchase of Goods
contracts
 The main protection lies in certain implied terms ‘accurate
description‘ and ‘satisfactory quality‘, ‘fit for purpose‘, ‘safe and
durable‘ ( implied means they are assumed to apply even if they
are not contained in any written contract).
o Fit for purpose
 Where the goods are purchased based on a description by the
seller, which you rely on in making a decision to buy, the way
the seller described the goods must correspond with the
actual goods supplied.
 This would apply even if you had a chance to view the goods
beforehand, as long as the description that the buyer gave
you differs from the actual goods supplied.
 This term applied both to sellers who operate as a
business and to those selling privately.
 For example: a car dealer advertising a white van for sale
would fail to comply with the description if they
supplied a green sports car.
 A shop advertising and displaying a musical film that
turned out to be a fishing documentary would also have
failed to provide an acceptable description (Article 41
C&CPL).
o Satisfactory quality
 A good sold should be of reasonable quality in terms of
its condition; that is, it should be fit for the purpose for
which it is bought.
 If you buy a vacuum cleaner, it should be able to suck
up dirt – if it cannot, it is not of satisfactory quality.
 The good should also be safe and durable – a car that
breaks down on the way back from the dealers or a
kettle that explodes when it is plugged in for the first
time may not meet the test.
 This requirement applies only to business sellers.
 The tests vary and in some cases defects in the
appearance of the good will be regarded as sufficient to
treat the good as being of unsatisfactory quality. Art.
41(4°) C&CPL
 Time limits (art. 43)
 The seller shall be held liable under this Law where the lack of
conformity becomes apparent within one year as from delivery
of the durable commodity.
 However, in order to benefit from his/her rights, the consumer
must inform the seller of the lack of conformity within a
period of fifteen (15) days from the date on which he/she
detected such lack of conformity.
 Unless proved otherwise, any lack of conformity which
becomes apparent within six (6) months of delivery of the
durable commodity shall be presumed to have existed at the
time of delivery unless this presumption is incompatible with
the nature of the commodity or the nature of the lack of
conformity.
 The list of durable goods shall be determined by a Ministerial
Order.
o Supply of services contracts
 A contract for the supply of a service exists when a
business, or person trading as business, carries out a
service to a consumer.
 Suppliers' duties
 The laws lay down certain conditions that a supplier
of service has to meet and they are assumed to apply
in every contract. These are known as implied terms
and apply regardless of whether they are written into
a contract or not.
• A duty of reasonable care and skill
 This means that a business providing a service must
ensure that the service is carried out carefully and must
reflect the skill the service provider has held out itself.
 For example: if a plumber is hired to fix a leak, they
should at least have the basic skill to understand what is
required and to carry out the job to a reasonable standard.
• A duty to supply the service within a reasonable time
There is a general duty to supply a service within a
reasonable time. What is a reasonable time will vary from
case to case. How it is determined will depend on the
nature of the trade the service is based on and standard
practice within that trade.
II. Unfair and deceptive acts and practices
 Unfair and deceptive acts or practices (UDAP) are
business tactics used to deceive or mislead consumers in
the marketplace.
 They can involve:
a) false or deceptive (dishonest) advertising,
b) incomplete information, misrepresentation of a product
or service, or
c) any other deceptive practice that harms consumers.
 In general , they are acts that are considered to be
unethical and that are not in the best interests of
consumers.
 Examples of unfair practices include
 bait-and-switch tactics (advertising an item at an
unrealistically low price as 'bait' to lure customers to a
store and then , witching to another higher price).
 inadequate disclosure of important information, and
 hidden fees or charges.
III. Warranties (guaranties)
 When contracting for the sale or purchase of goods,
manufacturers /sellers should be aware of any warranties that
the goods may be fit for a particular purpose.
3.1. Types of Warranties
 There are two main types of warranties, namely the express
and implied warranties.
a. Implied warranties
 An implied warranty is a guarantee that is not written down or
explicitly spoken. It is a promise implied by law, that certain
products will perform as expected.
 An implied warranty is automatically presumed regarding the
sale of goods or real property, which prevents from transferring
a risk to the buyer.
 The two main implied warranties are the warranty of
merchantability and the warranty of fitness for a particular
purpose.
 A warranty of merchantability is a type of warranty that
asserts that the goods are reasonably fit for its ordinary
and intended purpose for which they are sold.
 There are four essential elements of warranty of
merchantability:
 The product must have been sold;
 The plaintiff must have used the product in a foreseeable
way;
 The product must be defective; and
 The victim must have been hurt because of the product's
defective nature.
 A warranty of fitness for a particular purpose is a type of
warranty that asserts that the goods are suitable for the
special purpose of the buyer, and such warranty will not be
satisfied by mere fitness for general purposes.
 “Where the seller at the time of contracting has reason to
know any particular purpose for which the goods are
required and that the buyer is relying on the seller’s skill or
judgment to select or furnish suitable goods, there is,
unless excluded or modified under the next section, an
implied warranty that the goods shall be fit for such
purpose.”
 In other words, unless properly disclaimed in the contract,
an implied warranty of fitness for particular purpose arises
when:
(1) the seller knows, or should know, the buyer’s purpose for
the goods; and
(2) the seller knows, or should know, that buyer is relying on
seller to determine what the buyer needs for that purpose.
 Imagine that a customer walks into a watch store, and tells
the proprietor that he intends to go scuba diving and needs
a watch to monitor his dive time.
 The customer then asks the proprietor to recommend a
watch for the trip. In such circumstances, any
recommendation by the proprietor almost certainly will be
deemed to include a warranty that the watch is waterproof
and otherwise suitable for scuba diving.
b. Express warranties
 An express warranty is an agreement by a seller to provide
repairs or a replacement for a faulty product, component, or
service within a specified time period after it was purchased.
 Express warranties can be made on a product’s label, in an
advertisement, or through a written contract with the
customer.
 The seller may expressly warrant in the contract that the goods
will be fit for the buyer’s intended purpose. In such cases, the
seller should take care to make sure that he/she really knows
the buyer’s purpose and that the goods are, in fact, fit for that
purpose.
 Unlike in the case of implied warranties, lack of knowledge
generally does not allow the seller to avoid an express warranty
that the goods are fit for buyer’s purpose.
 In the context of business-to-business sales in the
manufacturing supply chain, a manufacturer may ask,
what is the particular purpose for which its goods must be
fit? The answer is highly situational.
 In some cases, the answer may be relatively simple. Similar
to the scuba diving example above, a buyer may identify
generally the use to which it intends to put the goods.
 More often, the answer involves looking at any
specifications or other requirements provided by the
buyer.
Remedies for Breach of Warranty
1. Monetary damages:
 These damages can include the cost of repairs or replacement of
the product, as well as the cost of any additional items that were
purchased to make up for the defect.
2. Refund or replacement:
 Consumers may be entitled to a refund or replacement of the
defective product if the breach of warranty is severe enough.
 In some cases, the manufacturer may be required to replace the
product with a similar item of equal or greater value.
3. Rescission of sale: Rescission involves canceling a contract
and treating it as though it never existed by ensuring that all its
effects are eliminated.
 To return all parties to their original state, things that were
exchanged, such as money, must be returned.
 So, in some cases, the sale can be rescinded and the purchaser
gets a full refund of the purchase price.
 This remedy is typically used when the breach of warranty is so
severe that it renders the product unusable.
4. Injunctive relief:
 Consumers may be able to seek injunctive relief if the breach of
warranty has caused or is likely to cause irreparable harm.
 Injunctive relief is a remedy which restrains a party from doing
certain acts or requires a party to act in a certain way.
 It is generally only available when there is no other remedy at law
and irreparable harm will result if the relief is not granted.
 An example is when the plaintiffs in consumer class-actions ask
the court to order the defendants from continuing their allegedly
unlawful advertising or labeling. (Note that in this case, the
plaintiffs may sometimes face the exception of lack of standing to
seek such relief, because they face no imminent risk of future
injury).
5. Punitive Damages:
 Punitive damages may be available if the breach of warranty was
intentional or reckless. These damages are designed to punish.
 Product Liability
 Product Liability is an area of consumer protection law that
holds manufacturers, distributors, suppliers, retailers, and
others who make products available to the public responsible
for the damages caused by their products.
 It is based on the premise that those who make and sell
products have a duty to ensure that their products are safe and
free from defects.
 Product liability is an important part of consumer protection
law because it provides consumers with a remedy for injuries
caused by defective or dangerous products.
 In addition, it encourages manufacturers to design and
manufacture safer products and to provide adequate warnings
about potential hazards associated with their products.
 Product liability claims can be brought against manufacturers
and sellers.
Types of Product Liability Claims
1. Manufacturing Defect Claims:
 A manufacturing defect is a defect in the construction of a
product that makes it unreasonably dangerous for a consumer
to use.
 These claims occur when a product does not work as intended
due to a flaw in the way it was made.
 This is for example the case of a bike without brakes
2. Design Defect Claims:
 A design defect is a flaw in a product’s design that makes it
unreasonably dangerous for a consumer to use. These claims
occur when a product's design is inherently dangerous and
poses a risk of harm to consumers.
3. Failure to Warn Claims:
 A failure to warn claim occurs when a product's manufacturer
fails to provide adequate warnings to consumers about the
dangers of using the product.
 These claims occur when a consumer is injured or suffers harm
due to the lack of proper warnings.
4. Breach of Warranty claims:
 A breach of warranty claim occurs when a product fails to
meet the standards set forth in its warranty.
 These claims occur when a consumer is injured or suffers
harm due to a defect that is covered by the warranty but
not adequately repaired or replaced by the manufacturer.
5. Negligence claims:
 A negligence claim occurs when a consumer is injured or
suffers harm due to a manufacturer or seller's failure to
exercise reasonable care in the design, manufacture, or sale
of a product.
 These claims are based on the legal theory that the
manufacturer or seller should have taken steps to prevent
the injury or harm from occurring.
Defenses to Product Liability Claims
1. Statutory Defenses:
 Statutory defenses are those that are created or set forth
by a particular law.
2. Common Law Defenses:
 Common law defenses are based on court decisions and
legal principles, rather than statutes.
 Common law defenses include:
 Contributory negligence, which means that the
consumer was partially responsible for their own
damages;
 Assumption of risk, which means the consumer knew
of the risk and voluntarily assumed it; and
 A lack of privity, which means the consumer does not
have a direct relationship to the manufacturer.
Civil actions for damages
 Any person who has incurred loss as a result of a violation
of provisions of the Law regarding consumer protection
may institute an action in a court of law.
 Registered consumers protection associations may
institute a civil action in a court of law upon request by a
consumer or when the subject matter of the action aims at
seeking compensation for damages.