. /.WORLD TRADE
ORGANIZATIONWT/WGTCP/W/170
6 August 2001
(01-3900)
Working Group on the Interaction
between Trade and Competition PolicyOriginal:  French
COMMUNICATION FROM THE KINGDOM OF MOROCCO
The following is the final text of a paper received from the Permanent Mission of Morocco
which was circulated as an advance copy for the Working Group's meeting of 22-23 March 2001.
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Note on the Law on Free Pricing and Competition
The transition from a planned and protected economy to a liberalized and outward-looking
economy has led to increased competition.  Morocco's accession to the GATT Agreements on the one
hand, and the gradual opening-up of the Moroccan market  to industrial production as part of the creation
of the free-trade area with the European Union on the other, as well as the progressive liberalization of
domestic prices, has involved the establishment of  rules for the competitive functioning of markets.
The Law on Free Pricing and Competition sets out a new legal framework for the economic
regulation of the market.  It will enable Morocco to join the developing countries that have effectively
liberalized their economies through the adoption of competition legislation.
Regarded as an economic policy instrument of the Government on the one hand, and a corollary
to the freeing-up of prices, the liberalization of fore ign trade and privatization on the other, the Law on
Free Pricing and Competition aims to ensure:
- free price formation through the free play of competition;- free market access;- transparency and fairness in trade relations;
- the strengthening of rules regarding consumer information.
It establishes the principle of free pricing and price determination through the free play of
supply and demand.  However, there are two exceptions which limit this principle:  the Government has
the right to intervene on prices, either for structur al reasons (monopoly or lack of competition), or for
short-term reasons (crisis in the supply of a raw ma terial such as oil, or a disaster affecting the
population, such as drought).
It promotes healthy and fair competition by  prohibiting anti-competitive practices.  Such
practices may involve either collusive pricing or market allocation, or the abuse of an operator's or group
of operators' dominant market position or  of an economic partner's dependency.WT/WGTCP/W/170
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It introduces a mechanism for activities relating to economic concentrations.  The aim is to
allow merger activities to be controlled and monitore d because they can create or strengthen dominant
positions which could be detrimental to free competition.  The aim is not to prevent the consolidation of
economic operators, but to ensure that such gr oupings leave the market sufficiently competitive.
It increases the transparency and fairness of trade relations by defining rules of transparency and
prohibiting practices that are restrictive to normal trade relations between economic operators.
Restrictive practices affecting competition are:
- those relating to consumer information and protection, including labelling of prices,
invoicing, refusal to sell and contingent sales, premium sales;
- those involving restrictive conduct in relations between professionals, including
invoicing rules, publication of price lists and conditions of sale, fixed minimum resale
prices, discriminatory conditions of sale, refusal to sell and conditional sales;
- those relating to the warehousing of goods and illegal storage.It defines the competition investigation proce dure.  The new procedure ensures that the
investigations that are needed to protect vic timized consumers and companies can be conducted
efficiently, and protects controlled undertakings fro m abusive or arbitrary behaviour on the part of
investigators.
The penalties for such practices are determined by  the courts in accordance with the offence and
the damage caused to the market or operators and th e warranting circumstances (bad faith of the parties
involved, second offence).
Finally, the Law introduces a change at the level of  the institutions responsible for ensuring the
smooth operation of market mechanisms by creating a body, the "Competition Council".  The
Competition Council is made up of experts and has a consultative function in the area of anti-
competitive practices (cartels, abuse of dominant positions, economic dependence) and mergers.  It
plays a significant role in reconciling the interests of  operators.  It examines the cases put before it and
provides technical advice,  making proposals to the Prime Minister regarding action to be taken.
The Law will enter into force at the beginning of July 2001.
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