Bidpaper Plus (Pty) Ltd v Pretoria Wholesale Stationers (Pty) Ltd (03/LM/Jan09) [2009] ZACT 49; [2009] 2 CPLR 386 (CT) (17 July 2009)

Bidpaper Plus (Pty) Ltd v Pretoria Wholesale Stationers (Pty) Ltd (03/LM/Jan09) [2009] ZACT 49; [2009] 2 CPLR 386 (CT) (17 July 2009)

The Tribunal found that although the merged entity would have a post-merger market share of approximately 50% in the wholesale stationery market, the market remains competitive with several credible competitors and low barriers to entry. The Commission's investigation revealed that competitors could source products from other wholesalers, manufacturers, or imports, and that customers possess countervailing power. The vertical integration resulting from the merger does not raise foreclosure concerns due to the presence of alternative suppliers and distributors. Regarding public interest, the Tribunal imposed a condition limiting retrenchments to no more than 24 employees, as the union had...

Citation
[2009] ZACT 49
Parties
Applicant: Bidpaper Plus (Pty) Ltd; Respondent: Pretoria Wholesale Stationers (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
17 July 2009
Case Number
03/LM/Jan09
Procedural Posture
Merger Control / Reasons for Decision After Conditional Approval
Outcome
Merger conditionally approved subject to employment condition.
Judges
D Lewis, N Manoim, Y Carrim
Legal Topics
Merger Control, Market Concentration, Vertical Integration, Public Interest Retrenchment
Competition Law Commercial and Corporate Merger Control Market Concentration Vertical Integration Public Interest Retrenchment

Case Brief

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Parties

Bidpaper Plus (Pty) Ltd

Applicant

Pretoria Wholesale Stationers (Pty) Ltd

Respondent

Procedural Posture

Merger Control / Reasons for Decision After Conditional Approval

Legal Issues

  1. 1 Whether the proposed merger would substantially lessen or prevent competition in the wholesale and retail stationery markets.
  2. 2 Whether the transaction would result in anti-competitive foreclosure in manufacturing, wholesaling, or retailing of stationery products.
  3. 3 Whether the retrenchment of employees post-merger raises public interest concerns.

Ratio Decidendi

The Tribunal found that although the merged entity would have a post-merger market share of approximately 50% in the wholesale stationery market, the market remains competitive with several credible competitors and low barriers to entry. The Commission's investigation revealed that competitors could source products from other wholesalers, manufacturers, or imports, and that customers possess countervailing power. The vertical integration resulting from the merger does not raise foreclosure concerns due to the presence of alternative suppliers and distributors. Regarding public interest, the Tribunal imposed a condition limiting retrenchments to no more than 24 employees, as the union had...

Court Disposition

Merger conditionally approved subject to employment condition.

Orders

  • The merger between Bidpaper Plus (Pty) Ltd and Pretoria Wholesale Stationers (Pty) Ltd is approved subject to the condition that retrenchments arising from post-merger rationalisation must be limited to no more than 24 employees.