competition amendment bill to be tabled in parliament
06 June 2008

The  Department  of Trade and Industry has published a draft Competition Amendment Bill (" the draft Bill"), which the Minister of Trade and Industry intends to introduce into Parliament during June 2008. 

The  draft  Bill  proposes to introduce a number of significant amendments to the Competition Act, including criminal penalties for directors and managers who are reasonably expected to have known of their company's involvement in cartel activities (i.e. the fixing of prices and /or  trading conditions, market division or collusive tendering).  A director or manager convicted of such an offence faces a fine of up to R500 000, or to imprisonment for a period not exceeding 10 years, or to both a fine and imprisonment.

The  draft Bill also seeks to prohibit firms from participating in a "complex monopoly" if such participation has the effect of substantially lessening or preventing competition, and the market within which the complex monopoly subsists is characterised by a restriction on supply,  high entry barriers, a lack of innovation, or any other similar characteristics. 

According to the  draft Bill, a complex monopoly subsists within the market for any particular goods or services if at least 45% of the goods or services in that market are supplied to, or by two or more firms and such firms conduct their respective business affairs in a co-ordinated manner.

The  draft Bill will also empower the Commission to conduct market inquiries, at its own initiative and at any time, and thereafter to initiate formal complaints on the basis of information obtained during such inquiries

Webber Wentzel Competition Department Newsletter 06 June 2008