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Deepening Democracy through Access to Information
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Catch Up With Competition Law Now – May 2019

6th June 2019 BY: Creamer Media Reporter

Local News

Engineering & construction: Construction company colludes

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The Commission has referred a settlement agreement it reached with a construction company, GVK-Siya Zama (Cape) (Pty) Ltd (GVK), to the Competition Tribunal for confirmation as an order. The company has been charged with price-fixing, market division and collusive conduct in the construction industry. In terms of the settlement agreement, GVK has agreed to pay an administrative penalty of ZAR6 million.

Financial services: Updates & developments

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In the financial services sector, there are two developments of interest:

Healthcare: Nurse's application against GEMS dismissed

The Tribunal has dismissed an interim relief application by a certified registered nurse against the Government Employees Medical Scheme (GEMS). Charlnita Cassiem, who runs her own business by administering dialysis to patients, had requested, among other things, that an agreement between GEMS and clinical technologists to provide open dialysis should be declared anti-competitive because its sole intention is to create a cartel. Ms Cassiem also requested that GEMS is interdicted from exercising its dominant position by compelling customers to stop making use of Cassiem’s services. GEMS argued that it had no dominance or market power capable of being abused and that Cassiem was using this process to extort payment from GEMS.

Industrials: Updates & developments

In the industrials sectors, there are three developments of interest:

Mining: CAC dismisses appeal against Sibanye / Lonmin merger conditions

The Competition Appeal Court (CAC) has dismissed an appeal by the Association of Mineworkers and Construction Union to set aside the Tribunal's approval of the merger between Sibanye Gold Ltd and Lonmin PLC. The CAC concluded that the merger parties had established that the determination of the number of jobs to be lost as a result of the merger was rational, and that the public interest in preventing employment loss had been balanced.

Regulatory: Updates & developments

There are two regulatory developments of interest:

Retail: Updates & developments

In the retail sector, there are three developments of interest:

Tourism: Robben Island boat operators' hearing

A hearing involving two boat operator companies has taken place before the Tribunal. The companies, who ferry passengers between the V&A Waterfront and Robben Island, are alleged to have engaged in price-fixing and tender collusion. The case relates to a tender issued by the Robben Island Museum for bidders to be listed on its database as preferred service providers. Following an investigation, the Commission found that five companies had been involved in the collusive activities. In June 2018, the three other companies involved admitted to the charges and settled with the Commission.

Transport: Updates & developments

In the transport sector, there are two developments of interest:

Rest of Africa News

Angola: New competition authority begins receiving merger filings

The Competition Regulatory Authority of Angola (ARC) confirmed that it has received a merger notification of the transaction between Angolan Bank, Banco Economico and local insurance company, Tranquilidade-Corporacao Angolana de Seguros. The regulatory authority indicated that it received the notification in March 2019, but did not mention the exact stake that will be acquired by Banco Economico.

Botswana: Authority conditionally approves Edcon merger

The Botswana Competition Authority (BCA) conditionally approved the acquisition of 100% of the shares in Edgars Consolidated Stores Ltd by New HoldCo. The BCA noted that the proposed transaction did not raise any competition concerns but would give rise to certain public interest concerns. It approved the merger on the condition that "the merged entity shall use all its endeavours to ensure that the business of Edgars Consolidated Limited (Edcon) is maintained in Botswana; and in the event that the merged entity is compelled to change the Botswana business model, such intentions should be communicated to the Competition Authority with a clear justification for the decision."

ECOWAS: Regional competition authority launched

On 31 May 2019, the Commission of the Economic Community of West African States (ECOWAS) launched its regional competition authority in Gambia. The ECOWAS Regional Competition Authority (ERCA) has been established to implement the Regional Competition Rules adopted by the ECOWAS Authority in 2008. ECOWAS member states include Benin, Burkina Faso, Cape Verde, Gambia, Ghana, Guinea, Guinea-Bissau, Ivory Coast, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone and Togo. Following the launch, the ERCA held meetings to chart a course for the operations of ERCA. Henrietta Uzoamaka Didigu has been appointed as the first Executive Director of the ERCA.

Kenya: Authority conditionally approves banking merger

The Competition Authority of Kenya (CAK) conditionally approved the proposed merger between Commercial Bank of Africa Ltd (CBA) and NIC Group. In terms of the proposed transaction, NIC will issue new shares to CBA shareholders. The CAK approved the merger subject to the condition that no employee is declared redundant for a period of 12 months from the date of closing the transaction.

Nigeria: Transitional merger filing arrangements

The Securities Exchange Commission (SEC) and Federal Competition and Consumer Protection Commission (FCCPC) have issued a joint advisory note on transitional arrangements for merger filings in Nigeria. The FCCPC and SEC have reached a mutual understanding with respect to pending and new merger notifications. During the transition period, which began on 3 May 2019, all notifications will be reviewed under existing SEC Regulations and Guidelines, and notifications will be filed at the FCCPC offices. The SEC and FCCPC will jointly review notifications and the FCCPC will convey decisions.

Zimbabwe: Authority to probe agricultural merger

The Competition and Tariff Commission (CTC) has decided to investigate the proposed acquisition of Profeeds Private (Pvt) Ltd (Profeeds) and Produtrade Pvt Ltd by Ashram Investments Pvt Ltd. The CTC will assess whether the merger will lessen competition or will result in the creation of a monopolistic situation, and has requested that interested stakeholders submit written representations by 14 June 2019.

International News

Australia: TPG Telecom and Vodafone merger prohibited

The Australian Competition and Consumer Commission prohibited the proposed merger between TPG Telecom Ltd (TPG) and Vodafone Hutchison Australia Pty Ltd. The ACCC has concluded that the proposed merger is likely to substantially lessen competition in the supply of mobile services because the proposed merger would preclude TPG entering as the fourth mobile network operator in Australia.

European Union: Raids conducted in retail sector

The European Commission (EC) confirmed that its officials have carried out unannounced inspections at the premises of companies active in the grocery retail sector in France. The EC has concerns that two grocery retail companies may have violated EU antitrust rules that prohibit cartels and restrictive business practices.

United Kingdom: Updates & developments

In the United Kingdom, there are two developments of interest:

United States of America: Qualcomm to appeal decision

Qualcomm Incorporated, one of the world's largest smartphone chip and modem manufacturers, has announced that it will appeal a recent judgement which found that it had violated competition laws. Earlier in May, U.S. District Judge Lucy Koh found that Qualcomm’s licensing practices have strangled competition in parts of the chip market for years, harming rivals, smartphone makers, and consumers.

Our Recent Work

Crossfin / Sureswipe

The Commission has unconditionally approved the acquisition of Sureswipe (Pty) Ltd, by Crossfin Technology, a leading independent fintech group.

Daryl Dingley and Clare-Alice Vertue represented the merger parties.

Sureswipe provides acquiring, payment and value-added services to a diversified customer base across South Africa.

The Commission found that the merger is unlikely to substantially lessen or prevent competition or raise any public interest concerns.

Old Mutual Life and AE-AMD Independent Power Producer 3 / AE-AMD Independent Power Producer 1

The Tribunal has unconditionally approved a proposed merger whereby Old Mutual Life Assurance Company (South Africa) Ltd (OMLACSA) seeks to acquire AE-AMD Independent Power Producer 3 (RF) (Pty) Ltd (Herbert) and AE-AMD Independent Power Producer 1 (RF) (Pty) Ltd (Greefspan).

Shawn van der Meulen and Makati Seekane represented the merger parties.

OMLCSA is a long-term insurer which provides various products. It also operates in the renewable energy sector and invests in a number of projects under the government’s Renewable Energy Independent Power Purchase Procurement Program (REIPPPP). Herbert and Greefspan are Independent Power Producers which have been awarded tenders under the REIPPPP to supply electricity generated from renewable sources (in this case solar) to Eskom.

The Tribunal found that the merger is unlikely to substantially lessen or prevent competition or raise any public interest concerns.

Sima Chrome / Bhaphalane Siyanda Chrome

The Commission has unconditionally approved the proposed merger whereby Sima Chrome (Pty) Ltd (SIMA) intends to acquire Bhaphalane Siyanda Chrome Company (Pty) Ltd (BSCC).

Mmadika Moloi and Busisiwe Masango represented the merger parties.

SIMA is an investment company which invests in platinum group metals, chrome, base metals (manganese), energy (coal, uranium, oil, gas) and industrials. BSCC is an investment holding company which is invested in various mining activities.

The Commission found that the merger is unlikely to substantially lessen or prevent competition or raise any public interest concerns.

Written by Elisha Bhugwandeen, Webber Wentzel  

EDITED BY: Creamer Media Reporter
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