Moroccan Competition Law: Market Regulation

The Moroccan legal landscape has undergone significant modernization to foster a transparent and attractive business environment. Central to this evolution is the regulatory framework governing competition and market dynamics. By ensuring that markets remain open and free from anti-competitive practices, Morocco aims to protect both the consumer's interests and the integrity of the national economy.

Understanding the nuances of Moroccan competition law is essential for investors, business owners, and legal practitioners. This article explores the core legal references, the role of regulatory institutions, and the specific mechanisms used to maintain healthy market competition in the Kingdom.

The Scope and Jurisdiction of Competition Law

The primary legal instrument governing this field is Law No. 104.12 on the Freedom of Prices and Competition. According to Article 1 of this law, the regulations apply to all natural or legal persons, regardless of whether they have a permanent headquarters or establishment in Morocco. The determining factor for the law's application is whether their actions or operations affect competition within the Moroccan market or a significant part of it.

The law covers a wide array of activities, including:

• All production, distribution, and service activities.
• Actions by public legal entities when they act as economic operators rather than exercising public authority.
• Export agreements, provided they have an impact on competition within the Moroccan domestic market.

By casting a wide net, the Moroccan legislature ensures that no entity can bypass the rules of fair play, regardless of its legal status or geographical origin.

Institutional Oversight: Bank Al-Maghrib and the Competition Council

In Morocco, market regulation is not the responsibility of a single entity but involves a sophisticated coordination between sectoral regulators and the Competition Council (Conseil de la Concurrence). This is particularly evident in the financial sector.

Under Law No. 104.12 and the laws relating to credit institutions, there is a mandatory consultation process. For instance, Article 50 stipulates that if Bank Al-Maghrib (the central bank) receives a request for a merger or acquisition between two or more credit institutions, it must pause the decision-making process if the operation appears to violate economic concentration rules. It is then required to seek the opinion of the Competition Council.

Conversely, Article 49 of the law on credit institutions provides that if the Competition Council initiates its own study or receives a referral regarding anti-competitive practices involving a bank, it must first consult Bank Al-Maghrib. This "dual-key" approach ensures that financial stability and market competition are balanced by the respective experts in each field.

Economic Concentrations and Anti-Competitive Practices

Moroccan law is vigilant regarding "Economic Concentrations"—mergers, acquisitions, or joints ventures that could lead to a dominant market position. The law provides specific thresholds to determine when an operation must be reported to the authorities.

When practices are found to be anti-competitive (such as price-fixing or market sharing), the law provides for a reconciliation (settlement) process. Under Article 41 and Article 43 (bis) of Law No. 104.12, the government authority may propose a settlement to the parties involved.

• The fine in a settlement cannot exceed 5% of the entity's last known turnover in Morocco.
• If the parties accept and fulfill the settlement obligations, any ongoing proceedings before the Competition Council regarding those specific acts are terminated.
• If settlement is refused or the terms are not met, the case is referred back to the Competition Council for formal adjudication.

Competition in Public Procurement

Market regulation also extends to how the Moroccan state buys goods and services. Decree No. 2.22.431 (March 2023) regarding public procurement emphasizes that the selection of contractors must be based on the "most economically advantageous offer."

To ensure fair competition in public tenders, the law mandates clear criteria for evaluating technical and financial bids. According to Article 70 of the Decree, the project owner must prepare a comprehensive "Competition File" (Dossier de Consultation) that includes:

• The consultation rules and technical specifications.
• The evaluation criteria (such as quality, after-sales service, and environmental protection).
• Procedures for converting foreign currency bids into Moroccan Dirhams based on Bank Al-Maghrib's reference rates to ensure a fair comparison.

This transparency prevents favoritism and ensures that the public sector benefits from the same competitive pressures found in the private market.

Key Takeaways

The Moroccan framework for market regulation is built on three pillars:

1. Broad Applicability: The law follows the "effects doctrine," meaning any action impacting the Moroccan market is subject to local competition rules.
2. Institutional Cooperation: Major sectors like banking require coordinated oversight between the Competition Council and specialized regulators (Bank Al-Maghrib).
3. Settlement Mechanisms: The law provides a path for companies to resolve disputes through reconciliation, provided they comply with the financial and behavioral remedies imposed.
4. Public Transparency: Public procurement is strictly regulated to ensure that government spending promotes fair competition and rewards the most efficient economic actors.

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