Pacorini Metals Europe (B.V.) (Pty) Ltd v Access Freight Group (Pty) Ltd (016428) [2013] ZACT 55 (21 June 2013)

Pacorini Metals Europe (B.V.) (Pty) Ltd v Access Freight Group (Pty) Ltd (016428) [2013] ZACT 55 (21 June 2013)

The Tribunal found that the merger between Pacorini and AFG would not substantially lessen competition in the market for warehousing, transport and logistics services for commodities in South Africa. Both parties operate in different geographic markets, and the presence of numerous competitors makes foreclosure strategies unlikely. Although Glencore, Pacorini's parent, operates in South Africa and is a major customer of AFG, its market share is insufficient to enable customer foreclosure. Similarly, input foreclosure is improbable due to AFG's diverse customer base. The Tribunal identified a risk of information exchange between Glencore and its competitors, which could facilitate...

Citation
[2013] ZACT 55
Parties
Applicant: Pacorini Metals Europe (B.V.) (Pty) Ltd; Respondent: Access Freight Group (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
21 June 2013
Case Number
016428
Procedural Posture
Merger Control / Conditional Approval
Outcome
Merger conditionally approved subject to compliance with conditions in Annexure A.
Judges
Norman Manoim, Yasmin Carrim, Andreas Wessels
Legal Topics
Merger Control, Vertical Integration, Market Definition, Foreclosure, Information Exchange
Competition Law Commercial and Corporate Merger Control Vertical Integration Market Definition Foreclosure Information Exchange

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Parties

Pacorini Metals Europe (B.V.) (Pty) Ltd

Applicant

Access Freight Group (Pty) Ltd

Respondent

Procedural Posture

Merger Control / Conditional Approval

Legal Issues

  1. 1 Whether the proposed merger would substantially lessen competition in the market for warehousing, transport and logistics services for commodities in South Africa.
  2. 2 Whether the merger would give rise to customer or input foreclosure concerns.
  3. 3 Whether the merger would result in the exchange of strategically sensitive information leading to coordinated outcomes.

Ratio Decidendi

The Tribunal found that the merger between Pacorini and AFG would not substantially lessen competition in the market for warehousing, transport and logistics services for commodities in South Africa. Both parties operate in different geographic markets, and the presence of numerous competitors makes foreclosure strategies unlikely. Although Glencore, Pacorini's parent, operates in South Africa and is a major customer of AFG, its market share is insufficient to enable customer foreclosure. Similarly, input foreclosure is improbable due to AFG's diverse customer base. The Tribunal identified a risk of information exchange between Glencore and its competitors, which could facilitate...

Court Disposition

Merger conditionally approved subject to compliance with conditions in Annexure A.

Orders

  • The merger between Pacorini Metals Europe (B.V.) (Pty) Ltd and Access Freight Group (Pty) Ltd is approved subject to the conditions set out in Annexure A of the Tribunal's order dated 19 June 2013.
  • The parties must implement measures to prevent the exchange of confidential information between Glencore and its competitors through AFG.