BASF Handels-Und Exportgesellschaft mbH v Ciba Holding AG (136/LM/Dec08) [2009] ZACT 42 (9 June 2009)

BASF Handels-Und Exportgesellschaft mbH v Ciba Holding AG (136/LM/Dec08) [2009] ZACT 42 (9 June 2009)

The Tribunal found that the relevant geographic markets are international, as all affected products are imported into South Africa. In the market for retention and drainage aids (RDAs), although the merged entity would hold a significant share, alternative international suppliers and strong local competitors such as Buckman provide sufficient competitive constraints. Customers, being large corporations, possess substantial countervailing power, and there are no significant barriers to entry. In the pigments and dyes markets, the merged entity's post-merger shares are not high enough to raise competition concerns, and entry barriers are low. In the HALS and UV absorbers markets, BASF's...

Citation
[2009] ZACT 42
Parties
Applicant: BASF Handels-Und Exportgesellschaft mbH; Respondent: Ciba Holding AG
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
9 June 2009
Case Number
136/LM/Dec08
Procedural Posture
Merger Clearance / Reasons for Decision
Outcome
Merger unconditionally approved.
Judges
D Lewis, U Bhoola, N Manoim
Legal Topics
Merger Control, Horizontal Overlap, Market Definition, Barriers to Entry, Countervailing Power
Competition Law Commercial and Corporate Merger Control Horizontal Overlap Market Definition Barriers to Entry Countervailing Power

Case Brief

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Parties

BASF Handels-Und Exportgesellschaft mbH

Applicant

Ciba Holding AG

Respondent

Procedural Posture

Merger Clearance / Reasons for Decision

Legal Issues

  1. 1 Whether the proposed merger between BASF and Ciba will substantially prevent or lessen competition in the relevant South African markets.
  2. 2 Whether there are significant barriers to entry in the affected markets.
  3. 3 Whether customers possess sufficient countervailing power to constrain the merged entity.

Ratio Decidendi

The Tribunal found that the relevant geographic markets are international, as all affected products are imported into South Africa. In the market for retention and drainage aids (RDAs), although the merged entity would hold a significant share, alternative international suppliers and strong local competitors such as Buckman provide sufficient competitive constraints. Customers, being large corporations, possess substantial countervailing power, and there are no significant barriers to entry. In the pigments and dyes markets, the merged entity's post-merger shares are not high enough to raise competition concerns, and entry barriers are low. In the HALS and UV absorbers markets, BASF's...

Court Disposition

Merger unconditionally approved.

Orders

  • The merger between BASF Handels-Und Exportgesellschaft mbH and Ciba Holding AG is approved without conditions.
  • No public interest concerns arise from the transaction.