Friedshelf 1508 (Pty) Ltd v RTT Holdings (Pty) Ltd (018739) [2014] ZACT 16 (24 July 2014)

Friedshelf 1508 (Pty) Ltd v RTT Holdings (Pty) Ltd (018739) [2014] ZACT 16 (24 July 2014)

The Tribunal found that the proposed merger does not raise horizontal competition concerns, as Friedshelf is a newly incorporated entity with no business activities. There is no overlap between the controlling companies of Friedshelf and RTT. The only vertical relationship identified is between RTT and ACSA, in which the GEPF/PIC has a controlling interest, but this does not result in input or customer foreclosure concerns. The main competition concern relates to the potential for competitively sensitive information to be shared between RTT and other portfolio companies in which the PIC has non-controlling interests, due to cross-directorships. To address this, the Tribunal imposed...

Citation
[2014] ZACT 16
Parties
Applicant: Friedshelf 1508 (Pty) Ltd; Respondent: RTT Holdings (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
24 July 2014
Case Number
018739
Procedural Posture
Merger Application / Approval With Conditions
Outcome
Merger approved subject to conditions.
Judges
Takalani Madima, Anton Roskam, Fiona Tregenna
Legal Topics
Merger Control, Vertical Relationships, Information Sharing, Cross Directorships
Competition Law Commercial and Corporate Merger Control Vertical Relationships Information Sharing Cross Directorships

Case Brief

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Parties

Friedshelf 1508 (Pty) Ltd

Applicant

RTT Holdings (Pty) Ltd

Respondent

Procedural Posture

Merger Application / Approval With Conditions

Legal Issues

  1. 1 Whether the proposed acquisition of RTT Holdings by Friedshelf 1508 raises competition concerns under the Competition Act.
  2. 2 Whether the vertical relationship between the parties creates input or customer foreclosure risks.
  3. 3 Whether cross-directorships and information sharing between portfolio companies pose a risk to competition.

Ratio Decidendi

The Tribunal found that the proposed merger does not raise horizontal competition concerns, as Friedshelf is a newly incorporated entity with no business activities. There is no overlap between the controlling companies of Friedshelf and RTT. The only vertical relationship identified is between RTT and ACSA, in which the GEPF/PIC has a controlling interest, but this does not result in input or customer foreclosure concerns. The main competition concern relates to the potential for competitively sensitive information to be shared between RTT and other portfolio companies in which the PIC has non-controlling interests, due to cross-directorships. To address this, the Tribunal imposed...

Court Disposition

Merger approved subject to conditions.

Orders

  • The merger between Friedshelf 1508 (Pty) Ltd and RTT Holdings (Pty) Ltd is approved subject to the conditions set out in Annexure A.
  • The PIC must ensure that any director appointed to the RTT board is not appointed to the boards of non-controlling portfolio companies.