This blog is co-authored by Yuveshen Naidoo, a candidate attorney.

Mozambique’s Competition Regulatory Authority (CRA) has recently approved a new leniency regulation, marking a significant step towards enhancing fair competition in the country. This regulation, formalised through Resolution no. 1/2025 on March 31, 2025, aims to strengthen mechanisms for identifying and inhibiting anti-competitive practices.

The scope of the leniency regime is broad, covering both horizontal and vertical agreements that restrict competition in Mozambique’s national market. While the core focus is on cartels and major collusive conduct between competitors, the regime also extends to vertical arrangements such as supply and distribution agreements, underscoring the CRA’s comprehensive approach to curbing anti-competitive behaviour. The Regulation applies not only to companies and associations of undertakings that operate in Mozambique or have an effect on its market but also to individuals such as witnesses and experts who have failed to comply with cooperation duties under the competition law.

To qualify for a reduction in fines, applicants for leniency must provide evidence that offers ‘significant added value’ compared to what information the CRA already holds. This typically means providing contemporaneous documents or detailed information that strengthens the authority’s ability to prove the alleged infringement. The regime offers a tiered system of fine reductions in any one investigation:

(a) the first applicant seeking leniency can secure a reduction of 50% to 70%;

(b) the second, between 30% and 50%; and

(c) the third, from 10% to 30%.

Notably absent from the Mozambican framework is the offer of full immunity to the first applicant, a feature commonly seen in other jurisdictions. The absence of this key feature arguably limits the incentive for companies to self-report conduct unknown to the CRA. Another potentially controversial aspect is the requirement that applicants formally confess their participation in the infringement, effectively waiving their right to challenge the CRA’s final decision in court.

The procedural aspects of the regime are carefully structured to facilitate cooperation while maintaining confidentiality. Leniency applications can be submitted: (i) by hand; (ii) by registered mail; (iii) online; or (iv) delivered orally at a meeting with CRA officials.
Applications must contain detailed information about the infringement, the parties involved, and the supporting evidence. Importantly, the CRA has introduced a marker system which was not included in the original draft regulation. The marker allows a company to secure its place in the leniency queue even if it cannot immediately submit all necessary information, giving it 15 business days or longer in the CRA’s discretion, to complete its submission. This feature offers applicants valuable time to gather evidence and ensures predictability and fairness in the leniency process.

Confidentiality is a cornerstone of the new leniency regime, with all applications and related information shielded from third-party access except when disclosure is mandated by law. This protection is crucial to building trust and encouraging companies to come forward, particularly in jurisdictions where whistleblowing may still be culturally sensitive or legally fraught.

South Africa’s Corporate Leniency Policy, introduced in 2004, has been a highly effective tool in combating cartel conduct. While exact figures vary, most successful cartel prosecutions by the Competition Commission have stemmed from leniency applications, with an increase of 5 applications and only one rejection in the 2023/24 financial year alone. The policy has proven effective in deterring anti-competitive behaviour, streamlining investigations, and securing convictions, particularly in sectors like construction and food. Despite concerns that criminal liability for individuals might deter whistleblowers, the policy remains internationally recognised and central to South Africa’s competition enforcement strategy.

The adoption of the leniency Regime in Mozambique sends a clear signal of the CRA’s commitment to stepping up its enforcement game. While the regime’s broad scope and structured incentives represent a substantial improvement in Mozambique’s competition toolkit, there are valid concerns that its lack of full immunity and confession requirement may blunt its effectiveness in surfacing cartel conduct that would otherwise go undetected. Even so, the CRA’s move to introduce a marker system and to formalise a clear procedure for leniency applications should encourage a more cooperative approach between the regulator and market participants.

The regulation can be accessed here:
https://tinyurl.com/3475dh6y