Anglo American PLC and Others and Silicon Smelters (Pty) Ltd and Another (40/LM/Mar00) [2000] ZACT 21 (16 May 2000)

Anglo American PLC and Others and Silicon Smelters (Pty) Ltd and Another (40/LM/Mar00) [2000] ZACT 21 (16 May 2000)

The Tribunal found that although De Beers would acquire full control over the Venetia mine and remove Saturn's production constraint, this change does not materially affect competition in the market for the production and sale of diamonds. De Beers already possesses significant market power through its downstream control of diamond marketing via the Central Selling Organisation. The removal of Saturn's influence does not enhance De Beers' ability to influence the market beyond its existing position. Furthermore, there are no public interest concerns, as the merger will not result in job losses or other adverse effects.

Citation
[2000] ZACT 21
Parties
Applicant: De Beers Consolidated Mines Limited; Respondent: Anglovaal Mining Limited; Respondent: Industrial and Commercial Holdings Limited
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
16 May 2000
Case Number
40/LM/Mar00
Procedural Posture
Large Merger / Merger Clearance
Outcome
Merger approved without conditions.
Judges
NM Manoim, DH Lewis, DR Terblanche
Legal Topics
Merger Clearance, Market Power, Production Constraint, Public Interest, Dominance
Competition Law Merger Clearance Market Power Production Constraint Public Interest Dominance

Case Brief

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Parties

De Beers Consolidated Mines Limited

Applicant

Anglovaal Mining Limited

Respondent

Industrial and Commercial Holdings Limited

Respondent

Procedural Posture

Large Merger / Merger Clearance

Legal Issues

  1. 1 Whether the acquisition by De Beers of Anglovaal Mining Limited's interest in Saturn Partnership substantially lessens or prevents competition in the market for the production and sale of diamonds.
  2. 2 Whether the removal of Saturn's production constraint materially affects competition in the diamond market.
  3. 3 Whether any public interest concerns arise from the merger, including employment effects.

Ratio Decidendi

The Tribunal found that although De Beers would acquire full control over the Venetia mine and remove Saturn's production constraint, this change does not materially affect competition in the market for the production and sale of diamonds. De Beers already possesses significant market power through its downstream control of diamond marketing via the Central Selling Organisation. The removal of Saturn's influence does not enhance De Beers' ability to influence the market beyond its existing position. Furthermore, there are no public interest concerns, as the merger will not result in job losses or other adverse effects.

Court Disposition

Merger approved without conditions.

Orders

  • The merger between De Beers Consolidated Mines Limited and Anglovaal Mining Limited is approved without conditions.
  • No public interest conditions are imposed.