The South African Competition Commission , which highlights patterns of concentration and participation in the South African economy.
It includes details on the Commission’s power to launch market inquiries into highly concentrated industries and its increased authority to impose structural remedies on businesses in these sectors.
The democratic government made competition regulation its preferred method of regulating private enterprises in the public benefit to, amongst other things, foster an economically inclusive economy.
For example, the Report states that the top three firms generate 50% of wind and solar power, and the top three refineries and LPG suppliers have a market share of more than 65%.
These amendments strive to do so through addressing high levels of concentration, enhancing small business development and tackling the “racially-skewed” spread of ownership through merger control, the imposition of structural remedies, the prosecution of abuses of dominance as well as, pertinently, market inquiries.
In other words, the competition authorities will be able to conduct a market inquiry if any feature or combination of features in a market adversely affects competition in that market, even if that impact is not substantial.
Furthermore, upon completing a market inquiry, the Commission can furnish recommendations for a change of policy, legislation and regulations to the Minister of Trade and Industry, as well as recommendations to other regulatory authorities in respect of competition issues.
Certainly, it appears from that there are a series of government initiatives aimed at enhancing the economic trajectory of the country, which may be bolstered by the Commission’s recommendations or active role in policy formulation.
Competition policy is certainly poised to be a key driver of economic reform, with the economic inclusion of SMEs and HDP firms speaking to one of the primary objectives of the Competition Act, which is to provide an opportunity for all South Africans to participate fairly in the national economy.
The Commission will enjoy more power to launch market inquiries into sectors it considers to be highly concentrated, with increased authority to impose structural remedies on businesses in these sectors if they are found to create barriers to entry for new participants.
Lerisha Naidu is a partner in Baker McKenzie’s Antitrust & Competition Practice Group in Johannesburg.
Angelo Tzarevski is a senior associate in Baker McKenzie’s Antitrust & Competition Practice Group in Johannesburg.