Unitrans Automotive (Pty) Ltd v Automall (Pty) Ltd (LM191Dec15) [2016] ZACT 11 (25 February 2016)

Unitrans Automotive (Pty) Ltd v Automall (Pty) Ltd (LM191Dec15) [2016] ZACT 11 (25 February 2016)

The Tribunal found that although the post-merger market share in East London for new passenger and light commercial vehicles appeared high, the overlap in brands was limited, as Unitrans Automotive operated only a Toyota dealership and Automall did not sell Toyota vehicles. The Commission's market share figures were therefore overstated. The merged entity would continue to face competition from other dealerships such as Meyers Motors, Ronnies Motors, and BMW Autohaus Monti. The Tribunal also considered the overlap in Nissan and Renault brands and found it did not affect competition in East London or the Eastern Cape. No public interest concerns were identified, as all Automall employees...

Citation
[2016] ZACT 11
Parties
Applicant: Unitrans Automotive (Pty) Ltd; Respondent: Automall (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
25 February 2016
Case Number
LM191Dec15
Procedural Posture
Merger Review / Approval
Outcome
The proposed merger is approved unconditionally.
Judges
Yasmin Carrim, Medi Mokuena, Andiswa Ndoni
Legal Topics
Merger Control, Market Share Analysis, Public Interest, Section 197 Labour Relations Act
Competition Law Merger Control Market Share Analysis Public Interest Section 197 Labour Relations Act

Case Brief

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Parties

Unitrans Automotive (Pty) Ltd

Applicant

Automall (Pty) Ltd

Respondent

Procedural Posture

Merger Review / Approval

Legal Issues

  1. 1 Whether the proposed merger between Unitrans Automotive and Automall will substantially prevent or lessen competition in the relevant markets.
  2. 2 Whether the transaction raises any public interest concerns, including employment effects.

Ratio Decidendi

The Tribunal found that although the post-merger market share in East London for new passenger and light commercial vehicles appeared high, the overlap in brands was limited, as Unitrans Automotive operated only a Toyota dealership and Automall did not sell Toyota vehicles. The Commission's market share figures were therefore overstated. The merged entity would continue to face competition from other dealerships such as Meyers Motors, Ronnies Motors, and BMW Autohaus Monti. The Tribunal also considered the overlap in Nissan and Renault brands and found it did not affect competition in East London or the Eastern Cape. No public interest concerns were identified, as all Automall employees...

Court Disposition

The proposed merger is approved unconditionally.

Orders

  • The merger between Unitrans Automotive (Pty) Ltd and Automall (Pty) Ltd is approved without conditions.
  • All employees at Automall are to be retained in accordance with section 197 of the Labour Relations Act.