A critical appraisal of East African Community Law governing economic subsidies and their impact on competition

Abstract

This article examines the effectiveness of the East African Community legal framework governing economic subsidies and their impact on competition in controlling the granting of such subsidies by Governments of the Partner States. It employs qualitative techniques involving documentary review of legal instruments, case law and scholarly writings, as well as interviews with selected officials in relevant portfolios in Kenya and Tanzania. The research concludes that the legal standards for the regulation of economic subsidies facilitate the effective limitation of the intervention in the market by Governments of the Partner States. The standards may, accordingly, be applied to limit their intervention in the market, using economic subsidies only to the extent strictly necessary to correct market failure. It also establishes, in contrast, that the regulatory institutions are unsuitable, with reference to their power, to limit the intervention in the market by the said Governments. Accordingly, it, recommends that the institutional framework of the Community be reviewed so as to safeguard the functional autonomy of the regulatory institutions and harmonise their mandates.