Association of System Operators v Competition Commission and Others (71/SM/Nov10, 72/SM/Nov10) [2013] ZACT 45 (5 June 2013)

Parties

Procedural Posture

Review Application / Tribunal Decision on Review of Merger Approvals

Legal Issues

1. 1 Whether the Competition Commission's conditional approval of the Nomad and Emid small mergers was reviewable for irrationality, unreasonableness, or error of law.
2. 2 Whether the Commission's reliance on conditions proposed by the South African Reserve Bank, rather than imposing its own enforceable conditions, constituted a reviewable irregularity.
3. 3 Whether the conditions imposed adequately addressed competition concerns such as bundling, cross-subsidisation, information exchange, and monitoring of compliance.

Ratio Decidendi

The Tribunal found that the Commission committed a reviewable irregularity by failing to impose its own enforceable 'hold separate' and related conditions, instead relying on the South African Reserve Bank to regulate aspects material to competition. This abdication rendered the Commission's decisions unreasonable and irrational in law. However, the Tribunal declined to prohibit the mergers or order divestiture, as such relief was not sought in the notice of motion and the merging parties were not before the Tribunal. Instead, the Tribunal upheld the conditional approvals subject to remittal: the Commission must reconsider and redraft the conditions, particularly those addressing bundling...

Court Disposition

Conditional approvals of the Nomad and Emid mergers are upheld, but the conditions are remitted to the Commission for reconsideration and redrafting.

Orders

• The interveners are granted leave to join the proceedings.
• Subject to paragraphs 3-8, the Commission's conditional approvals are upheld.