Could Public Interest Trump Competition Issues in a Merger?

Section 12 A of the Competition Act 89 of 1998 suggests that a merger, which on the face of it is anti-competitive, can be justified on the basis of substantial public interest benefits and an otherwise pro-competitive merger can be prohibited on substantial public interest grounds.

The Competition Tribunal considers mergers in a number of stages. First, it considers whether the merger will substantially prevent or lessen competition. If it will, the Tribunal must determine if the anti-competitive effects are offset by any technological, efficiency or other pro-competitive gains. Whatever the conclusion, the Tribunal must consider the effect that the merger will have on:

• a particular industrial sector or region;