ALLEGATIONS of uncompetitive practice in the property valuation industry by commercial banks has arisen, with Namibia’s competition watchdog, the Namibian Competition Commission (NaCC) acknowledging that such concerns have been brought to their attention.
A complaint recently written to the Commission by property valuer, Mekondjo Alfeus highlights that commercial banks could be violating various clauses of the competition Act.
These include, Section 23 (1), Section 23 (2)(a) Section 23 (2)(b), Section 23 (3)(e), Section 23 (3)(g), Section 26(1), Section 26(2)(a), Section 26(2)(b), Section 26 (2)(c) and Section 26 (2)(d).
Alpheus in his complaint noted that part of their experiences as previously disadvantaged valuers is that for the longest time now, commercial banks have played the role of both “player and referee” to the advantage of previously advantaged valuers.
“Banks are competitive property valuers in the valuation market who offer valuation services for which they charge a fee. However, they block valuations done by valuers who are not on their panels, thereby dictating to clients which valuers they should use. This is done without any valid reason, except that such valuers are not on their panels of valuers. Banks have their set valuation fees which they charge clients, but should the same banks outsource the services to an external valuer, they determine the service fees of external valuers,” Alpheus complains further stating: “In writing to you, I request that the Namibian Competition Commission launches an investigation into such unfair competitive practices and lawlessness. I would like to highlight that this letter represents the silent voices of many other property valuers who fear the high possibility of victimization and employment marginalization because of the dominant positions of power the banks hold.”
This week, Paulus Hangula, acting director & senior economist in the enforcement, exemptions & cartels division at NaCC told Business Express that they were aware of such concerns.
“We have heard these concerns in this specific industry but there is no investigation currently underway. We have to engage the concerned parties after which we will come to an understanding of what the next steps will be,” Hangula said.
Last week, NaCC launched a probe into alleged exclusive dealings in property conveyance between Bank Windhoek and law firm Dr Weder, Kauta and Hoveka Incorporated.
The NaCC suspects an alleged agreement between Bank Windhoek and the law firm creates an unfair advantage over other law firms.
The dealings, involving property conveyancing services, are being investigated under section 33 of the Namibian Competition Act.
NaCC released a statement to this effect, saying it received a complaint that Bank Windhoek and Dr Weder, Kauta and Hoveka Incorporated entered into an exclusive conveyancing agreement for properties financed by the bank.
It is alleged that the agreement requires Bank Windhoek property financing applicants to only make use of Dr Weder, Kauta and Hoveka Incorporated’s conveyancing services, to the exclusion of other service providers in the market.
“The agreement and its maintained exclusivity is said to limit competition and forecloses other independent service providers in the relevant market, which is provisionally defined as the provision of conveyancing services to Bank Windhoek-financed property transactions,” the NaCC statement read.
Bank Windhoek allegedly contravened section 23 (1), read with section 23 (2) (b) of the Competition Act, the commission said.
Bank Windhoek is also alleged to have contravened section 23 as well as section 26 that speaks to abuse of dominance.
As a result, Bank Windhoek is accused of directly or indirectly imposing unfair practices, while limiting or restricting progress.
The bank is also accused of applying dissimilar conditions to equivalent transactions with other trading parties; and making the conclusion of contracts subject to acceptance by other parties of supplementary conditions.