Antitrust News from the Philippines, South Africa and Morocco: A New Comer, a Non-Conventional Merger Decision and Germany Offers Guidance

By Amine Mansour*

During last days, Francisco and I were very busy due to a huge workload. However, many important developments in the DW antitrust arena occurred.

1/– Philippines nears introduction of its first comprehensive competition Law.  Recently, the Senate President indicated that the Congress will pass the Act (will be known as Fair Competition Act of 2014) before yearend. This is close to became true as the text was approved on Second reading by the senators. Philippines is the last country from the ASEAN six majors to adopt a competition law (Indonesia and Thailand in 1999, Singapore in 2004, Vietnam in 2005 and Malaysia 2010). Introducing a Competition bill has become a pressing issue in Philippines giving its regional commitments. In 2015, ASEAN countries will implement the ASEAN Economic Community (regional economic integration) which calls in its Master Plan (ASEAN Economic Community Blueprint) for countries to undertake several actions in the field of competition and in particular “Endeavour to introduce competition policy in all ASEAN Member Countries by 2015“.

In substance however, the text comprises not only prohibitions on anti-competitive agreements and abuse of dominant position but introduces also a merger control regime. The wording of some provisions suggests that the drafters were inspired by the EU competition law model. In support of this position, we can, for instance, note the existence of the object/effect alternative in the article laying down the prohibition of anti-competitive agreements. Also, the exemption mechanism is somehow similar to article 101 (3) TFEU even if it does not include all the four conditions. Similarly to article 101 TFEU, the assessment of anti-competitive agreements under the Fair Competition Act of 2014 will thus consist of two different parts. Other developments confirm the preference given to the European model, but without going into too much detail (we will soon come up with a very detailed article on the Act) a quick overview of the text clearly points toward another victory for the European model of competition.

2/ In south Africa, The Competition Commission (CompetC) has identified in the merger Shoprite/Ellerines a public interest concerns relating to the situation of the 308 post-merger workers of the target company (Ellerines). Following this, it has recommended to the Tribunal making the approval of the merger conditional upon the retention of the remaining employees.  Naturally, the Tribunal agreed, yesterday, with this proposal and approved the merger on the condition that all post-merger workers will be employed by the acquiring firm Shoprite. Such decision does not come as a surprise. Article 12A (3) of the Competition Act clearly stipulates that: ” When determining whether a merger can or cannot be justified on public interest grounds, the Competition Commission or the Competition Tribunal must consider the effect that the merger will have on (…) (b) employment (…)“. But probably the most striking fact is that, the CompetC and Tribunal both have to assess a merger on the ground of public interest even if it appears that the notified operation does not give rise to any competition concerns. So this is probably why employment and other public interest issues are so often raised in merger cases in South Africa (for some very recent cases see here and here and also this one). Taking into account those precisions, what we have been highlighting as a very special case is not that special given the very nature  of article 12A of the Competition Act and somehow the Act itself which, inter alia, calls in section 2 relating to the purpose of the Act for the promotion and maintenance of competition in the Republic” in order (…) to promote employment and advance the social and economic welfare of South Africans (…)“.

3/ In Morocco, the Decree n° 2.14.652 which is an implementing regulation of the new law n° 104-12 on Freedom of Prices and Competition was adopted on the first of December (Her for Arabic readers). In this context, the Moroccan Competition Council (MCC) and German Federal Enterprise for International Cooperation (GIZ) launched a support program aiming at assisting the Moroccan institution in its effort to implement the newly adopted text. It is the second such project, after a twinning project , funded by the EU and implemented in 2009 between the MCC and the Bundeskartellamt for the purpose of strengthening the capacity of the Moroccan regulator.

*Co-editor, Developing World Antitrust

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One thought on “Antitrust News from the Philippines, South Africa and Morocco: A New Comer, a Non-Conventional Merger Decision and Germany Offers Guidance

  1. […] of a law that departs from the mainstream consumer-welfare paradigm was given to us by Amine in the previous post concerning a particularity of the merger review process in South Africa. The issue of whether a […]

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