Harmony Gold Mining Company Ltd v Pamodzi Gold Free State (Pty) Ltd (71/LM/Oct 09) [2010] ZACT 11; [2009] 2 CPLR 402 (CT) (5 February 2010)

Harmony Gold Mining Company Ltd v Pamodzi Gold Free State (Pty) Ltd (71/LM/Oct 09) [2010] ZACT 11; [2009] 2 CPLR 402 (CT) (5 February 2010)

The Tribunal found that the merger would not result in a substantial lessening of competition in the international gold market, as the combined market share of Harmony and Pamodzi Free State would be only 3.28%. The merger was also found to be in the public interest, as it would prevent the permanent loss of employment for a significant number of employees. The Tribunal considered Harmony's undertakings to re-engage 2,400 employees within 24 months and made these undertakings conditions for approval. The Tribunal further imposed conditions to ensure adequate protection for employees, noting that agreements with unions alone were insufficient and that direct protection for individual...

Citation
[2010] ZACT 11
Parties
Applicant: Harmony Gold Mining Company Limited; Respondent: Pamodzi Gold Free State (Pty) Ltd (in provisional liquidation)
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
5 February 2010
Case Number
71/LM/Oct09
Procedural Posture
Merger Application / Approval With Conditions
Outcome
Merger approved subject to conditions protecting employee interests.
Judges
N Manoim, Y Carrim, A Wessels
Legal Topics
Merger Control, Public Interest, Employment Protection, Market Definition
Competition Law Commercial and Corporate Merger Control Public Interest Employment Protection Market Definition

Case Brief

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Parties

Harmony Gold Mining Company Limited

Applicant

Pamodzi Gold Free State (Pty) Ltd (in provisional liquidation)

Respondent

Procedural Posture

Merger Application / Approval With Conditions

Legal Issues

  1. 1 Whether the proposed merger between Harmony Gold Mining Company Limited and Pamodzi Gold Free State (Pty) Ltd raises substantial competition concerns.
  2. 2 Whether the merger is in the public interest, particularly regarding employment protection.
  3. 3 Whether the conditions attached to the merger approval adequately protect affected employees.

Ratio Decidendi

The Tribunal found that the merger would not result in a substantial lessening of competition in the international gold market, as the combined market share of Harmony and Pamodzi Free State would be only 3.28%. The merger was also found to be in the public interest, as it would prevent the permanent loss of employment for a significant number of employees. The Tribunal considered Harmony's undertakings to re-engage 2,400 employees within 24 months and made these undertakings conditions for approval. The Tribunal further imposed conditions to ensure adequate protection for employees, noting that agreements with unions alone were insufficient and that direct protection for individual...

Court Disposition

Merger approved subject to conditions protecting employee interests.

Orders

  • The merger between Harmony Gold Mining Company Limited and Pamodzi Gold Free State (Pty) Ltd is approved subject to the conditions contained in Annexure 'HP1'.
  • Harmony Gold must re-engage 2,400 employees within 24 months as per the Union Termination and Recall Agreement and Separation Agreement.