Don’t wait for leniency… Lipimile signals delays

COMESA Chief Warns of Delayed Implementation of Leniency Policy

George Lipimile, CEO, COMESA Competition Commission

George Lipimile, Director, COMESA Competition Commission

In an interview with Concurrences, CCC Director George Lipimile stated cautiously that, while the agency had engaged a consultant to help it craft a regional leniency programme, it still had to “be discussed in detail with Member States. Given the different legal systems and the feedback coming from the consultations with Member States so far, this may take some time.”

Thus, “while there is no amnesty programme visible on the near-term horizon, the CCC’s novel cartel enforcement push poses particular concerns for undertakings operating in the COMESA region,” says Andreas Stargard, attorney with Africa advisory firm Pr1merio.  “Director Lipimile has expressed his agency’s plan — jointly with the World Bank organisation — to launch a project designed to combat cartel activity.  They propose to do so first, it seems, by piggy-backing off of other enforcers’ previous investigations, such as the South African Competition Commission’s cartel cases, and analysing whether those instances of foreign collusion could have harmful effects on the COMESA economies.”

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Notifying African M&A – balancing burdens & costs

Merger filings in Africa remain costly and cumbersome

By AAT guest contributor Heather Irvine, Esq.

The Common Market for Eastern and Southern Africa Competition Commission (COMESA) recently announced that it has received over US$3 million in merger filing fees between December 2015 and October 2016.

heatherirvineAbout half of these fees (approximately $1.5 million) were allocated to the national competition authorities in various COMESA states. However, competition authorities in COMESA member states – including Kenya, Zambia and Zimbabwe – continue to insist that merging parties lodge separate merger filings in their jurisdiction. This can add significant transactional costs – the filing fee in Kenya alone for a merger in which the merging parties combined generate more than KES 50 billion (about US $ 493 million) in Kenya is KES 2 million (nearly US $ 20 000). Since Kenya is one of the Continent’s largest economies, significant numbers of global transactions as well as those involving South African firms investing in African businesses are caught in the net.

Merging parties are in effect paying African national competition authorities twice to review exactly the same proposed merger. And they are not receiving quicker approvals or an easier fling process in return. Low merger thresholds mean that even relatively small transactions, often with no impact on competition at all, may trigger multiple filings. There is no explanation for why COMESA member states have failed to amend their local competition laws despite signing the COMESA treaty over 2 years ago.

Filing fees are even higher if a proposed cross-border African merger transaction involves a business in Tanzania or Swaziland– the national authorities there have recently insisted that filing fees must be calculated based on the merging parties’ global turnover (even though the statutory basis for these demands are not clear).

The problem will be exacerbated even further if more regional African competition authorities, like the Economic Community of West African States (ECOWAS) and the proposed East African Competition authority, commence active merger regulation.

Although memoranda of understanding were recently signed between South Africa and some other relatively experienced competition regulators on the Continent, like Kenya and Namibia, there are generally few formal procedures in place to harmonise merger filing requirements, synchronise the timing of reviews or align the approach of the regulators to either competition law or public interest issues.

The result is high filing fees, lots of duplicated effort and documents on the part of merging parties and the regulators, and slow merger reviews.

If African governments are serious about attracting global investors, they should prioritise the harmonisation of national and regional competition law regimes.

Copperweld elsewhere: Why SA is not pursuing fisheries “cartel”

The concept of single economic entities and intra-company conspiracies

 

Competition forum highlights antitrust enforcement, international cooperation

South Africa signs cooperation agreements with Russia and Kenya

Leading government officials presented their respective countries’ accomplishments in the antitrust arena at the 10th annual Competition Law, Economics & Policy Conference in Cape Town yesterday.

south_africaThe attendees ranged from the SA Minister of Economic Development, Ebrahim Patel, and the Commissioner of the Competition Commission, Tembinkosi Bonakele, to their Russian and Kenyan counterparts.  Kenya Competition Authority director general Francis Kariuki emphasised the officials’ desire to remove barriers to trade.  He was quoted as saying he looked forward to exchanging information on cross-border cartels, which affect both the South African and Kenyan economies: tsar_200“We have regional economic communities and regional trade. There are some infractions in South Africa which are affecting Kenya and vice versa. We want to join hands to do market enquiries and do research. This will inform our governments when they come up with policies.”

On the inside-BRICS front, the SA Commission signed an MoU with Russia, adding to Russia’s “rich and diverse bilateral agreements portfolio.”  The MoU is described as focussing particularly on pharmaceutical and automotive sectors, in which pending or future sectoral inquiries would see information-sharing between the Federal Antimonopoly Service (FAS) of Russia and the SACC, according to the FAS deputy chief Andrey Tsarikovskiy.

Patel talksMister Patel’s keynote address showed the glass half-full and half-empty, focussing in part on the need to “scale” the South African agency activity up to the level of the “success story” of domestic competition enforcement and its large caseload (quoting 133 new cartel cases initiated in the past year).

Never one to omit politicisation, Mr. Patel noted the perceived parallels he saw between South African history of concentrating economic power in the hands of a minority, raising indirectly the issue of public-interest concessions made in antitrust investigations, including M&A matters.  Mr. Patel clearly sees the SACC’s role as including a reduction in economic inequality among the populace, rather than being a neutral competition enforcer guided solely by internationally recognised legal antitrust & economic principles.  Both he and Commissioner Bonakele drew parallels between their anti-cartel enforcement and a purported reduction in the SA poverty rate of a whopping four tenths of a percent.

 

 

South African Competition Commission… More Dawn Raids!

By AAT Senior Contributor, Michael-James Currie.

On 28 September 2016, the South African Competition Commission (SACC) conducted a further set of dawn raids. This time, on various cargo shipping liners based in the provinces of Kwa-Zulu Natal and the Western Cape.

The SACC indicated that “Hamburg Sud South Africa (Pty) Ltd, Maersk South Africa (Pty) Ltd, Safmarine (Pty) Ltd, Mediterranean Shipping Company (Pty) Ltd, Pacific International Line South Africa (Pty) Ltd and CMA CGM Shipping Agencies South Africa (Pty) Ltd have engaged in collusive practices to, inter alia, fix the incremental rates for the shipment of cargo from Asia to South Africa in contravention of the Competition Act”.

The investigation is allegedly a result of a complaint received from a member of public.

south_africaThe SACC has not provided an indication of the period over which conduct took place and whether this investigation relates to historical or on-going conduct. This is an important consideration in light of the introduction of criminalisation of cartel conduct, which came into effect as of 1 May 2016. In terms of the Section 73A of the Competition Amendment Act, any director or person with management authority may be held criminally liable for ‘causing’ or ‘knowingly acquiescing’ in cartel conduct.

Since the notion of criminal liability was put raised as far back as 2008, there have been substantial concerns raised about the effectiveness of the SACC’s corporate leniency policy which in effect, offers immunity to a company who whistle blows, from an administrative penalty only. The CLP does not offer immunity to any individual from criminal prosecution, as the discretion to prosecute an individual under Section 73A, rests solely with the National Prosecuting Authority.

The interplay between the introduction of criminal liability and dawn raids will, in our view, be quite significant as there have been a number of respondents who have thought to approach the SACC for leniency, off the back of a dawn raid. A decision which a company may think twice about if its directors may potentially be held criminally liable.

Regardless of the impact which the criminalisation of cartel conduct may have on the whistleblowing regime, the SACC remains committed to utilising dawn raids as one of its most powerful investigative tools.

The SACC has been strong proponent of dawn raids and despite having conducted its first dawn raids in the early 2000’s, the past 18 months has seen a marked spike in the number of dawn raids conducted across a broad range of sectors.

The shipping industry in particular has been the subject of significant attention from the South African Competition Authorities and last year saw substantial administrative penalties, of over R95 million, levied by way of a settlement agreement on WWL and NYK Shipping Liners respectively for having engaged cartel conduct in relation to certain shipping routes. This investigation, however, remains on-going.

Administrative Penalties & Behavioural Remedies – Two Sides of the Same Coin?

By AAT Senior Contributor, Michael-James Currie.

In the wake of the dust settling around the recent settlement agreement reached between ArcelorMittal (AMSA) and the South African Competition Commission (SACC), it may be an opportune time to consider the appropriateness of behavioural penalties levied in respect of firms engaging in cartel conduct or abuse of dominance practices.

AAT Header squareIn terms of the AMSA settlement agreement, AMSA admitted to contravening the cartel provisions contained in the Competition Act and agreed to pay a R1.5 billion (in instalments of no less than R300 million per annum for five years) administrative penalty. In addition to the administrative penalty, AMSA also agreed to invest approximately R4,6 Million into the South African economy for the next 5 years (provided the prevailing economic conditions render such investment feasible) by way of CAPEX obligations.

Furthermore, a pricing remedy was imposed on AMSA in terms of which AMSA undertook not to generate earnings before interest and tax of more than 10% for the next five years (which could be amended on good cause shown, but was capped, in any event, at 15%).

The nature of the settlement terms as agreed to by AMSA is not, however, a novel feature in settlements before the South African Competition Authorities. In 2010, the Competition Commission settled its investigation in relation to Pioneer Foods’ activities in the maize and wheat milling, baking, poultry and eggs industries (the settlement came after the Competition Tribunal had already imposed a R197 million administrative penalty against Pioneer in respect of its participation in a bread cartel).

In terms of the settlement agreement, Pioneer undertook to:

  • pay R250 million as an administrative penalty to National Revenue Fund;
  • pay R250 million to create an Agro-processing Competitiveness Fund to be administered by the Industrial Development Corporation (IDC);
  • increase its capital expenditure by R150 million over and above its currently approved capital expenditure (capex) budget; and
  • cooperate with the Competition Commission in the ongoing investigations and prosecutions of the cases that are the subject of this settlement; and stopping anti-competitive conduct and implementing a competition compliance programme.

Furthermore, and more recently, the consent agreement with edible fats producer Sime Darby Hudson Knight (“Sime Darby”), is a further example of a consent order which included financial undertakings in addition to paying an administrative penalty.

In terms of this consent agreement, Sime Darby undertook to invest and establish a warehouse for the distribution of its products into territories which it had previously not distributed its products into, due to the market allocation agreement which formed the basis of the complaint. Sime Darby also committed to contributing to funding the entry of a BEE distributor.

What is evident from the above three examples is that over and above the administrative penalty which may be imposed on a respondent, the financial impact of the additional behavioural and public interest related conditions may substantially exceed the administrative penalty itself.

It is, therefore, an important factor for respondents who find themselves in settlement negotiations with the Competition Commission to consider alternative terms of settling a matter as opposed to merely focussing on the administrative penalty itself.

From an agency’s perspective, the costs associated with behavioural conditions must be carefully weighed up as they also tend to require ongoing, and occasionally extensive oversight by the authorities. Furthermore, it is important to ensure that behavioural remedies are not abused, both by the authorities and by respondents.

south_africaWhile settlement negotiations are inherently flexible, it is important that agencies ensure an objective and a transparent methodology in the manner in which they approach the quantification of a settlement agreement. This has certainty been strived for by the Competition Commission when it elected to publish Guidelines on the Determination of the Calculation of Administrative Penalties (Guidelines). The objectives of the Guidelines, may however, be undermined in light of the broader behavioural and public interest related conditions imposed in recent cases.

A clear and objective point of departure would be favourable for both the agency itself and the relevant respondent in being able to conclude settlement negotiation expeditiously.

A further important consideration, which is particularly highlighted in the AMSA settlement agreement, is whether the remedies provide for an adequate deterrent factor and/or address the relevant harm.

Importantly, in the AMSA matter, AMSA’s R4.6 million CAPEX expenditure investment was as a result of a complaint into alleged abuse of dominance. In terms of the settlement agreement, AMSA did not admit liability for having engaged in abuse of dominance practices.

In light of the fact that the Competition Commission generally requires an admission of liability before concluding a consent order, it is not clear to us, at this stage, why the Commission elected not to demand an admission of liability in relation to the abuse of dominance complaint.

It may be that the Commission did not wish to spend the significant resources in prosecuting an abuse of dominance case, or that the Commission took the view that any abuse of dominance finding would likely only be in respect of the general prohibition against exclusionary conduct, as per Section 8(c) of the Competition Act, which carries no administrative liability for a first time offence.

Accordingly, it may have been a strategic weighing up of the ‘costs versus likely penalty’ which shaped the Commission’s strategic decision.

Whether or not such a strategic decision is justified is not a particular focus of this article. What we do wish to highlight, however, is that absent an admission of liability, a third party who seeks to pursue follow-on damages will be precluded from bringing a civil damages claim against AMSA. This was confirmed by the Supreme Court of Appeal in the Premier Foods matter in 2015.

The Media 24 Case

Shifting our train of thought to another issue, although not unrelated, is the question as to what exactly constitutes an administrative penalty?

The question was raised, although ultimately not decided by the Competition Tribunal in the recent Media 24 predatory pricing case.

After having been found guilty by the Competition Tribunal, in 2015, for contravening section 8(c) of the Competition Act (for engaging in ‘predatory pricing’), a separate hearing was held to determine the appropriate sanction. As mentioned above, an administrative penalty is not permissible for a first time offence of section 8(c) of the Act.

At the hearing the Competition Commission had proposed, as one of its remedies that Media 24 undertake to establish a R10 million development fund to fund a new entrant into the market.

Media 24 objected to the proposed remedy and raised the argument that the remedy proposed by the Commission would effectively be an administrative penalty, which is not a permissible sanction in terms of the Competition Act.

The Competition Tribunal elected to evaluate the remedy from a practical perspective, finding that the proposed remedy would not be suitable or effective, but deliberately kept open the legal question as to whether or not a remedy which requires any financial commitment from the respondent would effectively amount to an administrative penalty.

The question is rather vexing and may require clarification in due course.

Assuming that the proposed remedy in the Media 24 case would indeed amount to an administrative penalty, the question would naturally arise whether a CAPEX undertaking, as was the case in the AMSA matter discussed above, would also be considered a form of an administrative penalty. If so, then due consideration should be had as to whether the aggregation of the ‘stated administrative penalty’ (i.e. the R1.5 billion in AMSA’s case) together with the behavioural remedies imposed in AMSA (a minimum of R4.6 billion), should be calculated for purposes of determining whether the statutory cap of 10% of a firm’s turnover has been exceeded.

Alternatively, if the Competition tribunal ultimately decides that the proposed remedy in Media 24 is not an administrative penalty as contemplated in terms of the Competition Act, then effectively, we may see an entire new paradigm in the manner in which firms are sanctioned for contravening the Competition Act. For instance, those provisions of the Competition Act which do not cater for an administrative penalty for a first time offence (i.e., certain vertical, horizontal and abuse of dominance practices), may in any event result in respondents paying substantial ‘penalties’ for contravening these provisions.

Furthermore, respondents may not be afforded the protection which the statutory cap places on administrative penalties. As noted above, a firm may be subjected to an administrative penalty which does not exceed 10% of its annual turnover, but the net effect of the respondent’s financial liability may indeed exceed the cap.

While we do not pronounce our views on this issue, suffice it to say that firms engaging with the Competition Authorities with a view of concluding a settlement agreement are entering into a ‘new world’ and there are a number of options, avenues and risks associated in ultimately negotiating a settlement.

Accordingly, the issues raised above may be particularly useful in the manner in which firms embark on their settlement strategies.

 

 

SOUTH AFRICA: RECORD-BREAKING FINE IMPOSED ON ARCELORMITTAL SOUTH AFRICA LIMITED

By AAT Senior Contributor, Michael-James Currie.

The Competition Commission and South African steel producer, ArcelorMittal South Africa Limited (ArcelorMittal), have agreed to settle six complaints against ArcelorMittal for R1.5 billion (approximately US$ 112 million), in what is the largest (agreed) administrative penalty imposed in South Africa.

The penalty (by consent order) represents just under 5% of ArcelorMittal total turnover (including chemicals) for 2015.

The allegations which were brought against ArcelorMittal included allegations of price fixing and market allocation in what was termed by the Competition Commission the “steel cartel”.

In terms of the settlement agreement, ArcelorMittal admitted to contravening section 4(1)(b) of the Competition Act and will pay not less than R300 million per annum for five years from 2017. Furthermore, ArcelorMittal has undertaken to invest approximately R4.6 million into the South African economy for the next 5 years (provided the prevailing economic conditions render such investment feasible). Interest will be charged on the outstanding amount, interest starting to run 17 months after the finalisation of the settlement agreement.

In addition to the cartel conduct, the Commission had also instituted a complaint alleging the dominant steel manufacturer had engaged in excessive pricing. Although ArcelorMittal did not admit to wrongdoing in relation to the abuse of dominance allegation, the parties nevertheless agree that ArcelorMittal would not generate earnings before interest and tax of over 10% for the next 5 years (subject to certain exceptions).

The Competition Commission’s press release states the following:

ArcelorMittal admits that it engaged in collusion with CISCO, Scaw and Cape Gate by fixing prices and discounts, allocating customers and sharing commercially sensitive information in the market for the manufacture of long steel products, in contravention of the Competition Act. ArcelorMittal also admits that it fixed the purchased price of scrap metal with Columbus Steel, Cape Gate and Scaw. In respect of the flat steel complaint and the Barnes Fencing complaints, ArcelorMittal admits the conduct as alleged by the Commission but does not admit that this conduct constituted a contravention of the Competition Act. In relation to the pricing complaint, ArcelorMittal does not admit that it acted in contravention of the Competition Act.

The investigation and settlement agreement follows a leniency application brought by another respondent, Scaw Metals.  There is little doubt that the Competition Commission’s corporate leniency policy has permitted the Commission to uncover and successfully prosecute a number of cartels.   As previously reported on AAT, the risk remains that the recent introduction of criminal liability (on directors or persons having management authority)  for engaging in cartel conduct, may dampen the use of the whistle-blower regime (absent any formal immunity from criminal prosecutions).

The settlement agreement does, however, bring finality to all six cases against ArcelorMittal.

In light of the very recent civil damages awarded in favour of Nationwide Airlines against South African Airways for abuse of dominance which led to loss of profits, it will be interesting to see whether any civil party elects to prosecute ArcelorMittal for the excessive pricing complaint. In terms of the South African Competition Act and a recent judgment by the Supreme Court of Appeal, it appears as if the door is closed on a civil litigant brining a civil damages claim against a respondent, based on a breach of the competition Act, if there has been no adverse finding made against such a respondent by the Competition Tribunal (or Competition Appeal Court) as per section 65 of the Competition Act.

The admission to having engaged in cartel conduct, may, however, expose ArcelorMittal to civil liability over and above the settlement agreement.

“The WRAP” — our monthly summary of antitrust developments across the continent

AAT Header square

Competition-Law Developments: a WRAP from the Comp-Corner

Issue 2 – August 2016

The editors and authors at AAT welcome you to the second edition of “The WRAP.”

We look at the most recent developments and updates in respect of competition law and enforcement which has taken place across the African continent in recent months.

As always, thank you for reading the WRAP, and remember to visit us at AAT for up-to-date competition-law news from the African continent.

         –Ed. (we wish to thank our contributors, especially Michael James Currie, for their support)

Cooperation, handshakes & MoUs: all the rage in African antitrust?

AAT the big picture

Significant Strides made to Promote Harmonisation across African Competition Agencies

By AAT Senior Contributor, Michael-James Currie.

In the past 12 months there has been a steady drive by competition law agencies in Africa to promote harmonisation between the respective jurisdictions.

The African regional competition authority, the COMESA Competition Commission (CCC), has entered into memorandum of understandings with a number of its nineteen member states. On 5 June 2016, it was announced that the CCC has further concluded MoU’s with the Swaziland Competition Commission as well as the Fair Trade Commission of the Seychelles.

On 7 May 2016, it was announced that nine members of the Southern African Development Community (SADC) have also entered into and MoU. These member states include South Africa, Malawi, Botswana, Swaziland, Seychelles, Mozambique, Namibia, Tanzania and Zambia.

The SADC MoU was based on the 2009 SADC Declaration on Regional Cooperation and Consumer Policies.

SADC MoUAccording to the South African Competition Commissioner, Mr Tembinkosi Bonakele, the MoU creates a framework for cooperation enforcement within the SADC region.  “The MoU provides a framework for cooperation in competition enforcement within the SADC region and we are delighted to be part of this historic initiative,” said Bonakele.

Interestingly, although a number of the signatories to SADC MoU are not member states of COMESA (that is, South Africa and Namibia, who in turn, have a MoU between their respective competition authorities), Swaziland, Malawi and the Seychelles have existing MoU’s with the COMESA Competition Commission. Says Andreas Stargard, a competition practitioner with Primerio Ltd., “it will be interesting to see, first, whether there may be conflicts that arise out of the divergent patchwork of cooperation MoUs, and second, to what extent the South African Competition Authorities, for example, could indirectly benefit from the broader cooperation amongst the various jurisdiction and regional authorities.”

Part of the objectives of the MoUs to date has largely been to facilitate an advocacy role. However, from a practical perspective, the SADC MoU envisages broader information exchanges and coordination of investigations.

While the MoU’s are a positive stride in achieving cross-border harmonisation, it remains to be seen to what extent the collaboration will assist the respective antitrust agencies in detecting and prosecuting cross border anticompetitive conduct.

There may be a number of practical and legal hurdles which may provide challenges to the effective collaboration envisaged. The introduction of criminal liability for cartel conduct in South Africa, for example, may provide challenges as to how various agencies obtain and share evidence.

AB InBev/SABMiller: SA conditional approval

South African Competition Commission Concludes Investigation into the AB In-Bev/SABMiller deal and Recommends that the Merger be Approved Subject to Conditions

On 31 May 2016, the South African Competition Commission (SACC) recommended that that the Anheuser-Busch Inbev/ SABMiller merger be approved subject to various conditions relating to both competition and public interest concerns.

south_africaFrom a procedural aspect, the SACC’s recommendations are made to the South African Competition Tribunal, the adjudicative body ultimately responsible for approving a merger.

The SACC’s recommendations are not binding on the merging parties or the Tribunal. To the extent that the merging parties, or third parties, are concerned about the merger or the SACC’s recommendations, they may elect to participate in the hearing before the Tribunal.

In cases where neither the merging parties nor any third parties contest the SACC’s recommendations, the Tribunal usually rubber stamps the SACC’s recommendations.

We note that in terms of the SACC’s proposed recommendations, that the merging parties have made numerous undertakings to address the SACC’s concerns.

The following concerns and recommendations were proposed by the SACC:

  • A divestiture of SABMiller’s shareholding in the Distell Limited Group (a competitor of SAB in the cider market) within three years of the closing date of the transaction;
  • That no employees of the merged entity will be involved on the bottling operations of both Coca-Cola and PepsiCo and that no commercially sensitive information would be exchanged between employees in relation to these two soft drink entities;
  • AB Inbev will continue supplying third parties with ‘tin metal crowns’ in South Africa as AB Inbev will own the only ‘tin metal supplier’ in South Africa post merger for a period of 5 years;
  • AB Inbev should make at least 10% of its fridge space available, in small retail outlets or taverns, to competitors’ products to protect small beer producers;
  • The development of a R1 billion fund which will be used, inter alia, to develop barley, hops and maize output in South Africa;
  • No merger related retrenchments are to take place in South Africa, in perpetuity;
  • AB Inbev will continue to supply certain products to small beer producers;
  • AB Inbev will continue to ensure that it follows the same ratio of local production and will, itself, remain committed to sourcing products locally;
  • Undertakings to ensure that the merging parties will, within two years after closing the merger, propose to the Commission and Government its plan on how to maintain black participation in the company and preserve equity;
  • AB Inbev will continue to comply with the existing terms and conditions of the current agreements which exist between SABMiller and ‘owner-drivers’.

The merging parties have agreed to the majority of the conditions imposed on the merger. We note, however, that the SACC’s media statement does not make it clear that the merging parties have agreed to the divestiture recommendation. The merging parties have also not agreed to the proposed condition relating to a commitment to continue to supply small beer producers with hops and malt.

Accordingly, even in the absence of any third party intervention, this merger may still be contested before the Tribunal.

While the SACC’s official recommendations have not yet been published, it appears to us that a number of the concerns raised by the SACC relate to pre-existing concerns which are not merger specific. Furthermore, important aspect of the proposed recommendations, even those which have been agreed to between the parties, will be in perpetuity.

Furthermore, although what may appear to be a relatively innocuous proposed conditions which the merging parties shave agreed to, is that AB Inbev will respect the current existing contractual arrangements as between SABMiller and ‘owner drivers’.  Approving a merger subject to such a condition poses an interesting conundrum. What happens in the event that there is contractual dispute between Ab-Inbev and owner drivers in the future? Will the Tribunal have jurisdiction to hear such disputes and could the merged entity be subject to penalties for breaching a condition of the merger, despite a contractual dispute which may have little if anything to do with the merger itself?

We have previously, here on Africanantitrust raised our concerns regarding the merger specificity of the R1 billion development fund. To access our previous article on this topic, please click here.

In our view, the Competition Tribunal should satisfy itself that the proposed conditions, even if agreed to between the merging parties, should address merger specific concerns and nothing more. A decision by the Tribunal is precedent setting and has an impact on the transparency and certainty of the merger control process in South Africa. When mergers are approved subject to conditions which go beyond merger specificity, uncertainty is created.