Total South Africa (Pty) Ltd v Tosaco Commercial Services (Pty) Ltd (34/LM/Jun10) [2010] ZACT 61; [2010] 2 CPLR 376 (CT) (6 October 2010)

Total South Africa (Pty) Ltd v Tosaco Commercial Services (Pty) Ltd (34/LM/Jun10) [2010] ZACT 61; [2010] 2 CPLR 376 (CT) (6 October 2010)

The Tribunal found that the proposed merger would not result in significant market share accretion, as both Total SA and TCS have low shares in the relevant upstream and downstream markets. The presence of effective competitors in the market ensures that competition will not be substantially prevented or lessened. The vertical integration resulting from the merger does not raise foreclosure concerns, as Total SA will continue to supply products to competitors and customers. The public interest impact, specifically the retrenchment of five employees, is limited and does not outweigh the benefits of the transaction, which is also a consequence of a black economic empowerment initiative....

Citation
[2010] ZACT 61
Parties
Applicant: Total South Africa (Pty) Ltd; Respondent: Tosaco Commercial Services (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
6 October 2010
Case Number
34/LM/Jun10
Procedural Posture
Merger Application / Approval
Outcome
Merger approved unconditionally.
Judges
Norman Manoim, Andreas Wessels, Yasmin Carrim
Legal Topics
Merger Control, Vertical Integration, Market Share Accretion, Public Interest, Black Economic Empowerment
Competition Law Commercial and Corporate Merger Control Vertical Integration Market Share Accretion Public Interest Black Economic Empowerment

Case Brief

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Parties

Total South Africa (Pty) Ltd

Applicant

Tosaco Commercial Services (Pty) Ltd

Respondent

Procedural Posture

Merger Application / Approval

Legal Issues

  1. 1 Whether the proposed merger will substantially prevent or lessen competition in the relevant markets.
  2. 2 Whether the merger raises significant public interest concerns, including employment effects.
  3. 3 Whether the transaction results in anti-competitive vertical integration.

Ratio Decidendi

The Tribunal found that the proposed merger would not result in significant market share accretion, as both Total SA and TCS have low shares in the relevant upstream and downstream markets. The presence of effective competitors in the market ensures that competition will not be substantially prevented or lessened. The vertical integration resulting from the merger does not raise foreclosure concerns, as Total SA will continue to supply products to competitors and customers. The public interest impact, specifically the retrenchment of five employees, is limited and does not outweigh the benefits of the transaction, which is also a consequence of a black economic empowerment initiative....

Court Disposition

Merger approved unconditionally.

Orders

  • The merger between Total South Africa (Pty) Ltd and Tosaco Commercial Services (Pty) Ltd is approved without conditions.