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Following publication of a Presidential Proclamation today, 12 July 2019, certain sections of the Competition Amendment Act, 2018 (Act 18 of 2018) (the “Amendment Act”) have been promulgated by President Ramaphosa, and have come into full effect and operation.

The Minister of Trade and Industry, Mr Ebrahim Patel says the Amendment Act is one of the most important pieces of economic legislation of the 6th Administration and is evidence of Government’s continued commitment to drive economic transformation and inclusion.

“The Amendment Act introduces a number of important changes to the Competition Act (Act No. 89 of 1998), and is the first major review of the legislation since it was signed into law by President Nelson Mandela, twenty years ago,” says Patel.

The key sections covered by the proclamation include (i) a number of new definitions; (ii) changes to section 8 dealing with abuse of dominance; (iii) section 10 dealing with exemptions; (iv) section 12A dealing with public interest consideration during mergers; (v) sections under chapter 4A dealing with market inquiries; and (vi) section 59 dealing with penalties for offences under the Act. The Amendment Act also includes changes to provide greater institutional capacity; and clarify procedures for the Competition Commission, Tribunal and the Ministry.
 
Minister Patel discussed a number of these changes in his Budget Vote speech in the National Assembly on 11 July 2019.
 
Speaking on renaming the Department of Trade, Industry and Competition’s focus on promoting economic inclusion, Minister Patel remarked that with the new changes to the Act:
 
“Consumers and customers will have better protection against excessive prices by dominant firms in a market, with the law setting out clear criteria that the courts can apply to determine if a price is excessive.
 
“Regulators will have powers to investigate and address high levels of market concentration where these keep SMEs and black-owned enterprises out of the market.
 
“Worker ownership of shares of companies will be promoted through a criteria on expanded ownership during mergers.”
 
“Small and medium businesses will be given a special status in merger criteria, market inquiries and exemptions.”
 
“Larger businesses will have a more flexible exemptions regime in place to enable them to collaborate with each other to help expand South African production, grow our export markets, develop new technologies or expand jobs.
 
“The competition authorities will have additional resources, which will facilitate more efficient operations.”
 
Minister Patel indicates that the remaining sections of the Amendment Act, not promulgated today, will be phased in once additional work has been completed.
 
“By November this year, following publishing of draft regulations and public consultation, we intend promulgation of sections of the Act that provide small businesses with remedies against price discrimination by dominant firms; or when dominant buyers abuse their power by imposing unfair prices and other trading conditions,” adds Patel.
 
The Amendment Act was the subject of extensive consultation both within Government and with the public. A draft Bill was published by the Department in December 2017 for public comment, during which period more than 60 written submissions were received. The draft Bill was further discussed over more six months during 2018 at the National Economic Development and Labour Council (“NEDLAC”) with Organised Business and Labour.
 
Click here to access the gazette http://www.thedti.gov.za/gazzettes/42578.pdf

Issued by the Department of Trade and Industry