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New head for monopoly watchdog with a mission to tame monsters

The new head of the Egyptian Competition Authority, Sameh Al Torgoman, faces the tough task of proving the legitimacy of the regulatory body in a hostile environment

Marwa Hussein, Wednesday 12 Jan 2011
Sameh Torgoman
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The newly appointed head of the anti-trust body has a tough job ahead. Sameh Al Torgoman was nominated on Tuesday by the prime minister, Ahmed Nazif, to replace Mona Yassine at the Egyptian Competition Authority. Yassine was the first president of the criticised watchdog.

In a country where monopolies are the norm, Al Torgoman needs to address cartels and trusts across many sectors: "Ready-made garments, food industries, cigarettes, cinemas," enumerates Ahmed Ghoneim, advisor to the anti-trust body.

"The problem is he is not entitled to investigate in these sectors on his own will. The watchdog can only launch an investigation upon an assignment by the prime minister, or a complaint from a producer in the market," adds Ghoneim.

Al Torgoman is not a new face to regulation. He was previously head of the Cairo and Alexandria Stock Exchanges between October 1998 and August 2004 before leading the Mortgage Finance Authority.

"He was the first to introduce companies listing rules in the Egyptian stock market in 2002," remembers Magued Shawqui, the ex- head of the Cairo and Alexandria Stock Exchanges who worked for some time under Al Torgoman. Shawqui says that Al Torgoman mixes pragmatism with a legalistic vision because of his background in law. He has also worked in both the private and public sectors.

"He doesn't take very fast decisions as in the private sector but he isn't also as slow as the people of law," adds Shawqui.

In 2001, an opposition parliament member presented accused Al Torgoman during parliamentary session of wasting public funds. The charge was referred to the general attorney. He was accused of spending too much money on the renovation of the stock market's building in addition to giving big salaries to young employees who were said to be the sons of his relatives and friends. None of the accusations were ever upheld.

As for the retired head of the Egyptian Competition Authority, Mona Yassine, she overruled in more than 50 cases of monopolistic practices, including the two most difficult, cement and steel cases. The regulatory body is criticized for having its hands tied and lacking autonomy because of its affiliation to the ministry of commerce and industry.

The competition authority was created after the promulgation of the competition law in 2005. Since its creation, it investigated many cases, the most prominent concerning the cement and steel industry. In the first case, twenty cement industry executives were found guilty of price-fixing, each was punished with a LE10 million ($1.87 million) fine and another LE10 million for the implicated companies in August 2008.

While in the case of the steel industry, the court found in 2009 that Ahmed Ezz Steel Group was not engaged in any anti-competitive or monopolistic practices after a two-and-a-half-year investigation, a conclusion that shocked many observers.

Since then, the competition law was deemed as deficient and apparently difficult to amend.

An attempt in 2008 to reinforce the law was aborted in parliament by Ahmed Ezz, the steel magnate who controls almost half the market, when he orchestrated an overwhelming majority to vote against these amendments.

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