NMI Durban South Motors (Pty) Ltd v The Barloworld Motor Retail Business (LM202Feb21) [2021] ZACT 36 (21 May 2021)

NMI Durban South Motors (Pty) Ltd v The Barloworld Motor Retail Business (LM202Feb21) [2021] ZACT 36 (21 May 2021)

The Tribunal found that the proposed merger would not substantially prevent or lessen competition in any relevant market, as the combined market shares of the merging parties would remain moderate and sufficient competition would persist from other dealerships. No concerns were raised regarding after-sale services, parts, or accessories. The Tribunal accepted the unequivocal undertaking by the merging parties that no retrenchments would result from the transaction. Public interest concerns raised by the Minister of Trade, Industry and Competition regarding the impact on small and historically disadvantaged businesses were addressed through conditions requiring continued participation in a...

Citation
[2021] ZACT 36
Parties
Applicant: NMI Durban South Motors (Pty) Ltd; Respondent: The Barloworld Motor Retail Business
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
21 May 2021
Case Number
LM202Feb21
Procedural Posture
Large Merger / Merger Approval
Outcome
Merger conditionally approved subject to public interest conditions.
Judges
AW Wessels, Y Carrim, T Vilakazi
Legal Topics
Large Merger Review, Public Interest Conditions, Supplier Development Programme, Market Share Assessment, Employment Protection
Competition Law Commercial and Corporate Large Merger Review Public Interest Conditions Supplier Development Programme Market Share Assessment Employment Protection

Case Brief

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Parties

NMI Durban South Motors (Pty) Ltd

Applicant

The Barloworld Motor Retail Business

Respondent

Procedural Posture

Large Merger / Merger Approval

Legal Issues

  1. 1 Whether the proposed merger would substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the merger raises public interest concerns, particularly regarding employment and participation of small and historically disadvantaged businesses.
  3. 3 Whether the imposed conditions adequately address public interest concerns.

Ratio Decidendi

The Tribunal found that the proposed merger would not substantially prevent or lessen competition in any relevant market, as the combined market shares of the merging parties would remain moderate and sufficient competition would persist from other dealerships. No concerns were raised regarding after-sale services, parts, or accessories. The Tribunal accepted the unequivocal undertaking by the merging parties that no retrenchments would result from the transaction. Public interest concerns raised by the Minister of Trade, Industry and Competition regarding the impact on small and historically disadvantaged businesses were addressed through conditions requiring continued participation in a...

Court Disposition

Merger conditionally approved subject to public interest conditions.

Orders

  • The merger between NMI Durban South Motors (Pty) Ltd and The Barloworld Motor Retail Business is approved in terms of section 16(2)(b) of the Competition Act, subject to the conditions attached as Annexure A.
  • A Merger Clearance Certificate is to be issued in terms of Competition Tribunal rule 35(5)(a).