Vodafone Group Plc v Vodacom Group (Pty) Ltd (135/LM/Dec08) [2009] ZACT 20; [2009] 1 CPLR 229 (CT) (25 March 2009)

Vodafone Group Plc v Vodacom Group (Pty) Ltd (135/LM/Dec08) [2009] ZACT 20; [2009] 1 CPLR 229 (CT) (25 March 2009)

The Tribunal found that Vodafone does not compete with Vodacom in any product market in South Africa, rendering horizontal competition concerns irrelevant. Vertical effects, including input and customer foreclosure, were analysed and found not to be merger-specific or likely, as the relationship between Vodafone and Vodacom existed prior to the merger and would continue unchanged. Public interest concerns raised by the Communications Workers Union, particularly regarding potential employment loss at Telkom and alleged aggressive labour practices by Vodafone, were not substantiated by evidence. The Tribunal concluded that the merger would not substantially prevent or lessen competition nor...

Citation
[2009] ZACT 20
Parties
Applicant: Vodafone Group Plc; Respondent: Vodacom Group (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
25 March 2009
Case Number
135/LM/Dec08
Procedural Posture
Merger Clearance / Final Determination
Outcome
Merger unconditionally approved.
Judges
D Lewis, Y Carrim, N Manoim
Legal Topics
Merger Clearance, Vertical Integration, Input Foreclosure, Customer Foreclosure, Public Interest, Labour Practices
Competition Law Commercial and Corporate Merger Clearance Vertical Integration Input Foreclosure Customer Foreclosure Public Interest Labour Practices

Case Brief

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Parties

Vodafone Group Plc

Applicant

Vodacom Group (Pty) Ltd

Respondent

Procedural Posture

Merger Clearance / Final Determination

Legal Issues

  1. 1 Whether the proposed acquisition by Vodafone of an additional 15% shareholding in Vodacom will substantially prevent or lessen competition in any relevant market.
  2. 2 Whether the merger raises substantial public interest concerns, particularly regarding employment and labour practices.
  3. 3 Whether any conditions should be imposed on the approval of the merger.

Ratio Decidendi

The Tribunal found that Vodafone does not compete with Vodacom in any product market in South Africa, rendering horizontal competition concerns irrelevant. Vertical effects, including input and customer foreclosure, were analysed and found not to be merger-specific or likely, as the relationship between Vodafone and Vodacom existed prior to the merger and would continue unchanged. Public interest concerns raised by the Communications Workers Union, particularly regarding potential employment loss at Telkom and alleged aggressive labour practices by Vodafone, were not substantiated by evidence. The Tribunal concluded that the merger would not substantially prevent or lessen competition nor...

Court Disposition

Merger unconditionally approved.

Orders

  • The merger between Vodafone Group Plc and Vodacom Group (Pty) Ltd is unconditionally approved.
  • No conditions are imposed on the transaction.