JSE Ltd v Momentum Managed Account Platform Holdings (Pty) Ltd (68/LM/Oct10) [2011] ZACT 30; [2011] 1 CPLR 137 (CT) (3 June 2011)

JSE Ltd v Momentum Managed Account Platform Holdings (Pty) Ltd (68/LM/Oct10) [2011] ZACT 30; [2011] 1 CPLR 137 (CT) (3 June 2011)

The Tribunal found that, assuming the Competition Commission's theories of harm are correct, the negotiated conditions sufficiently address the risks of exclusionary conduct and barriers to entry. The conditions require the JSE to provide market information to competitors on equal terms, maintain strict confidentiality through audit protocols, keep MOMMAP and JSE as separate entities, allow competitors to choose independent auditors, restrict the listing of MOMMAP or related products, and prevent amendments to investment mandates for two years. These measures collectively ensure that competition in the managed account platform market is preserved and that future entry is not unduly...

Citation
[2011] ZACT 30
Parties
Applicant: JSE Limited; Respondent: Momentum Managed Account Platform Holdings (Pty) Ltd; Respondent: FirstRand Alternative Investment Management (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
3 June 2011
Case Number
68/LM/Oct10
Procedural Posture
Large Merger Review / Merger Approval With Conditions
Outcome
Merger approved subject to conditions.
Judges
Norman Manoim, Yasmin Carrim, Andreas Wessels
Legal Topics
Merger Control, Barriers to Entry, Managed Account Platforms, Market Information Access, Audit Powers, Listing Restrictions
Competition Law Commercial and Corporate Merger Control Barriers to Entry Managed Account Platforms Market Information Access Audit Powers Listing Restrictions

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Parties

JSE Limited

Applicant

Momentum Managed Account Platform Holdings (Pty) Ltd

Respondent

FirstRand Alternative Investment Management (Pty) Ltd

Respondent

Procedural Posture

Large Merger Review / Merger Approval With Conditions

Legal Issues

  1. 1 Whether the proposed merger would substantially prevent or lessen competition in the national market for managed account platform services.
  2. 2 Whether the JSE's monopoly over market information and audit powers would create barriers to entry for future competitors.
  3. 3 Whether the conditions imposed adequately address the Competition Commission's identified theories of harm.

Ratio Decidendi

The Tribunal found that, assuming the Competition Commission's theories of harm are correct, the negotiated conditions sufficiently address the risks of exclusionary conduct and barriers to entry. The conditions require the JSE to provide market information to competitors on equal terms, maintain strict confidentiality through audit protocols, keep MOMMAP and JSE as separate entities, allow competitors to choose independent auditors, restrict the listing of MOMMAP or related products, and prevent amendments to investment mandates for two years. These measures collectively ensure that competition in the managed account platform market is preserved and that future entry is not unduly...

Court Disposition

Merger approved subject to conditions.

Orders

  • The large merger between JSE Limited and Momentum Managed Account Platform Holdings (Pty) Ltd and part of the business of FirstRand Alternative Investment Management (Pty) Ltd is approved, subject to the conditions set out in Schedule A.
  • JSE must provide market information to existing and future MAP competitors on terms no less favourable than those offered to any JSE company.