Phelps Dodge National Cables Corporation and three others asked Competition Tribunal yesterday to confirm a settlement they had reached following an alleged failure, by the four respondents, to notify the Competition Commission of two intermediate mergers, as required in the Competition Act. The mergers took place in October 2006 and March 2007 respectively.

“The decision to impose only nominal penalties on the parties, equivalent to the filing fees that would have been payable if the mergers were notified, may have been seen as a bit of a soft touch from the Commission, which has recently sought to take a harder line against those who fail to obtain the necessary approval,” says Chris Charter, a director in the Competition practice at Cliffe Dekker Hofmeyr business law firm.

“However, yesterday morning the Tribunal declined to confirm the order and instead asked the Commission to submit its rationale for determining the penalty. In doing so, it's clear that the Tribunal takes prior implementation seriously and wishes to make sure that the terms of the order sends the correct message to the market regarding what will be taken into account when imposing fines. This is not the first time that the Tribunal has declined to merely rubber-stamp a consent agreement and the implication is that while in principle parties should be free to settle on any basis, it seems that the public interest requires some express justification for any settlement reached,” he adds.

For more information:
Chris Charter, Director, Competition Practice, Cliffe Dekker Hofmeyr,
Tel: +27 (0)11 562 1053 or email: chris.charter@dlacdh.com

Andrea Collocott, Head: Marketing, Cliffe Dekker Hofmeyr,
Tel: +27 (0)11 562 1281 or email: andrea.collocott@dlacdh.com

Angela Graham, Tel: 073 505 9012 yeahwrite@worldonline.co.za

Notes:
Cliffe Dekker Hofmeyr is one of the largest commercial law firms in South Africa with some 115 directors/partners and 250 qualified lawyers located at offices in Johannesburg and Cape Town.

Cliffe Dekker Hofmeyr lawyers specialise in services covering the complete spectrum of business legal needs in 11 core areas of practice. The firm also has dedicated sector-led teams consisting of lawyers with experience in a wide range of industries and the public sector.

Cliffe Dekker Hofmeyr is the South African member firm of DLA Piper Group, an alliance of legal practices, which includes firms with offices around the globe that are affiliated to members of the DLA Piper Practice but are not themselves members of it.

Cliffe Dekker Hofmeyr's Africa practice, in conjunction with DLA Piper Africa Group, is unrivalled in terms of pan-African legal services and geographical coverage.

DLA Piper is an international legal practice with over 3,500 lawyers located in 30 countries and 69 offices throughout Asia, Europe, the Middle East and the US.

For further information, please visit www.cliffedekkerhofmeyr.com