REPUBLIC OF SOUTH AFRIC

I

GOVERNMENT GAZETTE

STAATSKOERANT
VAN DIE REPUBLIEK VAN SUID-AFRIKA
As ‘n Nuusblad by die Poskantoor Geregistreer

Registered at the Post Ojice as a Newspaper

CAPE TOWN, 30 OCTOBER 1998
VOL.

400

No. 19412

KAAPSTAD, 30 OKTOBER 1998

OFFICE OF THE PRESIDENT No. 1392. 30 October 1998 No. 1392.

KANTOOR VAN DIE PRESIDENT 30 Oktober 1998

It is hereby notified that the President has assented to the following Act which is hereby published for general information:— No. 89 of 1998: Competition Act, 1998. .,

Hierby word bekend gemaak dat die President sy goedkeuring geheg het aan die onderstaande Wet wat hierby ter algemene inligting gepubliseer word:— No. 89 van 1998: Wet op Mededinging, 1998.

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No. 19412

GOVERNMENT GAZETTE. 30 OCTOBER 1998 COMPETITION ACT, 1998

Act No. 89, 1998

(English text signed by the President. ) (Assented to 20 October 1998.)

..-

ACT
To provide for the establishment of a Competition Commission responsible for the investigation, control and evaluation of restrictive practices, abuse of dominant position, and mergers; and for the establishment of a Competition Tribunal responsible to adjudicate such matters; and for the establishment of a Competition Appeal Court; and for related matters. PREAMBLE The people of South Africa recognise: That apartheid and other discriminatory laws and practices of the past resulted in excessive concentrations of ownership and control within the national economy, weak enforcement of anti-competitive trade practices. and unjust restrictions on full and free participation in the economy by all South Africans. That the economy must be open to greater ownership by a greater number of South Africans. That credible competition law, and effective structures to administer that law. are necessary for an efficient functioning economy. That an eflicient, competitive economic environment. balancing the interests of workers, owners and consumers and focussed on development. will benefit all South Africans. IN ORDER TO— provide all South Africans equal opportunity to participate fairly in the national economy; achieve a more effective and efficient economy in South Africa: provide for markets in which consumers have access to, and can freely select. the quality and variety of goods and services they desire: create greater capability and an environment for South Africans to compete effectively in international markets: restrain particular trade practices which undermine a competitive economy: regulate the transfer of economic ownership in keeping with the public interest: establish independent institutions to monitor economic competition: and ~ive etiect to the international law obligations of the Republic.

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No. 19412

GOVERNMENT GAZE’ITE, 30 OCTOBER 1998 COMPETITION ACT, 1998

Act No. 89, 1998

B
1. 2. 3.

E IT THEREFORE ENACTED by the Parliament of the Republic of South Africa, as follows:— TABLE OF CONTENTS CHAPTER 1 Definitions and interpretation Purpose of Act Application of Act CHAPTER 2 8 10 10 5

4. 5. 6. 7. 8. 9. 10.

Restrictive horizontal practices prohibited Restrictive vertical practices prohibited Restricted application of Part Dominant firms Abuse of dominance prohibited Price discrimination by dominant firm prohibited Exemption CHAPTER 3

12 12 10 14 14 14 14 16 15

11. 12. 13. 14. 15. 16. 17. 18.

Restricted application of Chapter Merger defined Notification of merger required Competition Commission merger proceedings Competition Tribunal merger proceedings Consideration of Mergers Competition Appeal Court Merger Proceedings Minister may participate in proceedings CHAPTER 4

18 18 20 20 20 22 23 24 24 25

19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43.

26 Establishment and constitution of Competition Commission 26 Independence of Competition Commission 26 Functions of Competition Commission 28 Appointment of Commissioner 30 30 Appointment of Deputy Commissioner 30 Appointment of inspectors 30 Staff of Competition Commission 30 Establishment and constitution of Competition Tribunal 32 Functions of Competition Tribunal 32 35 Qualifications of members of Competition Tribunal 32 Term of office of members of Competition Tribunal 34 Deputy Chairperson of Competition Tribunal 34 Competition Tribunal moceedinm Con~icts and disclosure of inter&t by members of Competition Tribunal 34 Acting by member of Competition Tribunal after expiry of term of office 34 40 34 Remuneration and benefits of members of Competition Tribunal 34 Staff of Competition Tribunal 36 Establishment and constitution of Competition Appeal Court 36 Function of Competition Appeal Court 36 45 Business of Competition Appeal Court 36 Terms of 05ce of members of Competition Appeal Court 38 Finances 40 Annual Report 40 Rules applicable to Competition Tribunal 42 50 Liability

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No. 19412

GOVERNMENT GAZETTE. 30 OCTOBER 1998 COMPETITION ACT. i 998

Act No. 89, 1998

CHAPTER 5 44. 45. 46. “47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. Initiating a complaint Investigation by Competition Commission Authority to enter and search under warrant Authority to enter and search without warrant Powers to enter and search Conduct of entry and search Outcome of complaint Referral to Competition Tribunal Hearings before Competition Tribunal Right to participate in hearing Powers of member presiding at hearing Rules of procedure Witnesses costs Appeals CHAPTER 6 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. Interim relief Orders of Competition Tribunal Administrative fines Divestiture Consent orders Status and enforcement of orders Civil actions and jurisdiction Variation of order Limitations of bringing action Standard of proof CHAPTER 7 69. 70. 71. 72. 73. 74. 75. 76. 77. Breach of confidence Hindering administration of Act Failure to attend when summoned Failure to answer fully or truthfully Failure to comply with Act Penalties Magistrate’s Court jurisdiction to impose penalties Serving documents Proof of facts CHAPTER 8 78. 79. 80. 81. 82. 83. 84. Regulations Guidelines Official seal Act binds State Information exchange with foreign agencies Transitional arrangements and repeal of laws Short Title and commencement of Act 62 6 2 40 62 62 62 62 6 2 45 64 68 70 58 5 8 30 58 58 60 60 60 35 60 60 50 52 5? ~o 54 54 54 54 5 6 25 58 58 42 ~~ 42 44 5 44 46 46 48 48 10 48 48 50 50 50 15 50

SCHEDULE 1 SCHEDULE 2 SCHEDULE 3

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No. 19412

GOVERNMENT GAZETTE, 30 OCTOBER 1998 COMPETITION ACT, 1998

Act No. 89, 1998

CHAPTER 1 DEFINITIONS, INTERPRETATION, PURPOSE AND APPLICATION OF ACT Definitions and interpretation 1. ( 1 ) In this Act— (i) ‘agreement’ includes a contract, arrangement or understanding, whether or not legally enforceable: (xv) (ii) ‘civil court’ means a High Court or Magistrates Court, as referred to in sections 166(c) and (d) of the Constitution; (xxii) (iii) ‘confidential information’ means trade, business or industrial information that belongs to a firm, has a particular economic value, and is not generally available to or known by others: (xxvii) (iv) ‘concerted practice’ means co-operative or co-ordinated conduct between jirms, achieved through direct or indirect contact, that replaces their independent action, but which does not amount to an agreement;
(vi)

5

10

15

(v) ‘Constitution’ means the Constitution of the Republic of South Africa, 1996 (Act No. 108 of 1996); (viii) (vi) ‘essential facility’ means an infrastructure or resource that cannot reasonably be duplicated, and without access to which competitors cannot reasonably provide goods or services to their customers; (xiv) (vii) ‘excessive price’ means a price for a good or service which— (au) bears no reasonable relation to the economic value of that good or service; and (W) is higher than the value referred to in subparagraph (us); (iv) (viii) ‘exclusionary act’ means an act that impedes or prevents a firm from entering into, or expanding within, a market: (xxiv) (ix) ‘firm’ includes a person, partnership or a trust; (v) (x) ‘goods or services’, when used with respect to particular goods or sen’ices, includes any other goods orsenfices that are reasonably capable of being substituted for them, taking into account ordinary commercial practice and geographical, technical and temporal constraints; (vii) (xi) ‘horizontal relationship’ means a relationship between competitors: (x) (xii) ‘interest’ means a member’s interesr as defined in the Close Corporations Act, 1984 (Act No. 69 of 1984); (i) (xiii) ‘market power’ means the power of ajrm to control prices. to exclude competition or to behave to an appreciable extent independently of its competitors, customers or suppliers; (xii) (xiv) ‘Minister’ means the Minister of Trade and Industry; (xiii) (xv) ‘organ of state’ has the meaning set out in section 239 of the Consfitufion; (xxiii) (xvi) ‘premises’ includes land, any building. structure, vehicle, ship, boat, vessel, aircraft or container: (xvii) (xvii) ‘prescribed’ means prescribed from time to time by regulation in terms of section 78; (xxviii) (xviii) ‘private dwelling’ means any part of a structure that is occupied as a residence, or any part of a structure or outdoor living area that is accessory to. and used wholly for the purposes of, a residence: (xviii) (xix) ‘prohibited practice’ means a practice prohibited in terms of Chapter 2; (xxv) (xx) ‘public regulation’ means any national, provincial or local government legislation or subordinate legislation, or any license, tariff, directive or similar authorisation issued by a regulaton authorih or pursuant to any statutory authority: (xvi) (xxi) ‘regulation’ means a regulation made under [his Acf: (xix) (xxii) ‘regulatory authority’ means an entity established in terms of national, provincial or local government legislation or subordinate legislation responsible for regulating an industry, or sector of an industry: (xx) (xxiii) ‘respondent” means a jirm against whom a complaint of a prohibited prucfice has been initiated in terms of fhis Act: (xxi)

~o

25

30

35

40

45

50

55

60

1(1

S(1, 19412

( ,()\ I R\ MEST GAZE1’”rF.. .;() ()([()}jt-R IWJ8 (’()\ lP}”[ I [ lo\ \(’”1. 199X

Act >(). 89, 1998

(\xi\ } ‘restrictive horizontal practice’ means an! practice li\[cd III .L,L[l~Jn 4: (ii) (-ix\’) ‘restrictive vertical practice” lllc:ill\ :itlylJractice listed ill\cc[l(J[15 :~]ii) (\\\ ’i) ‘small business’ hai the mMmng wt (WI in the National Sm:iIl BU\IIm\\ y A c t . 1996 (Act No. 10? \Jt ]wM): l\il (xxiii) ‘this Act’ includes tllerey Lll;l[t{~l~. ;ll~d Schedule\: (ix) ‘vertical relationship’ mc:m~ [IW rcla[iomship between a /IrJ/r WI Its (Xxllll) \uppliers. its customers (Jr bo[h. (\\\i) (2) Thi\ Act mustbeinterpreted(aJ in J manner that is consisten[ wl[h (IW (’~~~z.jfifufic~~~ and gi\es ctle~t [t) [bc 1 0 purposes wt out insection2: and (b) illu(lrllpli:iilceviththe interna[lon;~l l;IU obligations of the Republic, (3) Any person in[~rpretin,g or applying r/71.} ,.1( I IIlay consider appropriate torcl:n and
international Iav,.

Purpose of Act 2. The order([1) (b) (c) purpose of [/ii\ ,.!cf is to prolmote and maintain competition in the Republic in

15

to promote the etticiency. adaptability and dctclt)pnlent of the econc~m!: to provide consumers with competitii e prices ~nd product choices: to promote employment and advtince the social and economic weltarc ~)t’ 20 South African\: (d) to expand opportunities for South Africun participation in world markct~ and recognise the rote of foreign competition in the Republic; (t’) to ensure that smull md medium-sized enter-prises have an equitable ~~ opportunity to participate in the economy: and (f) to promote a greater spread of ownership. in particular to increase the
ownership stakes of historically disadvantaged persons.

Application of Act 3. ( I ) This Act applies to all economic activity within, or having an effect within. the 30 Republic, except— (a) collective bargaining within the meaning of section 23 of the Con.sti[/[ri{l~l, and the Labour Rel~tions Act, 1995 (Act No. 66 of 1995): (b) a collective agreement. as defined in section 213 of the Labour Relations Act. 1995: (c) the rules of a professional association to the extent that they are exempted in 35 terms of Schedule l; (d) acts subject to or authorised by publi[ regulation: or (c) concerted conduct designed to achie\e a non-commercial socio-ecotlolllic objective or similar purpose. (2) For all purposes of fhi.j Act. a person is ii historically disadvantaged person it that 40 person([1) is one of a category of individuals who. before the Constitution (Jt the Republic of’ South Africa, 1993 (Act No. 200 of 1993), came into opcra[it~n, were disadvantaged by unfair discrimination on the basis of race: is an association, a majority of whose members are individuals referred to in 45 (b) paragraph (a); (c) is a juristic person other than an associ~tion. and individuals referred to in paragraph (a) own and control a majority of its issued share capital or members’ itzfcre.~f and are able to control a majority of’ its votes; or is a juristic person or association. and persons referred to in paragraph ((l). (b/ 50 (d) or (c) own and control a majority of its i\\ued \hare capita] or rnernbers’ interest and are able to control a majority of its votes.

12

No. 194}2

GOVERNMENTG AZEnE,W OCTOBER 1998 COMPETITION ACT, 1998

Act No. 89.1998

CHAPTER 2 PROHIBITED PRACTICES PART A RESTRICTIVE PRACTICES Restrictive horizontal practices prohibited 4. ( 1 ) An ugreetnent between. or concerted pructice by, jirttrs, or a decision by an association of,firms, is prohibited if— (a) it is between parties in a horizontal relationship and it has the effect of substantially preventing or lessening competition in a market, unless a pany 10 the agreement, concerted practice. or decision can prove that any technology- I () cal, eti]ciency or other pro-competitive, gain resulting from it outweighs that effect; or (b) it involves any of the following re.srricti~’e horizontal practices: (i) directly or indirectly fixing a purchase or selling price or any other 15 trading condition; (ii) dividing markets by allocating customers, suppliers, territories. or specific types of goods or services; or (iii) collusive tendering. (2) An agreement to engage in a restrictive horizontal practice referred to in 20 subsection ( 1 )(b) is presumed to exist between two or more jirms if— (a) any one of those jirms owns a substantial shareholding, interes[ or similar right in the other, or they have at least one director or substantial shareholder in common; and (b) any combination of those firms engages in that restrictive horizontal practice. (3) A presumption contemplated in subsection (2) may be rebutted if ajrm, director 25 or shareholder concerned establishes that a reasonable basis exists to conclude that the practice referred to in subsection (1)(b) was a normal commercial response to conditions prevailing in that market. (4) For the purposes of subsection (2), “director” means— (a) a director of a company as defined in the Companies Act, 1973 (Act No. 61 of 30 1973); (b) a member of a close corporation as defined in the Close Corporations Act, 1984 (Act No. 69 of 1984); (c) a trustee of a trust : or 35 (d) a person holding an equivalent position in a firm. (5) The provisions of subsection ( 1 ) do not apply to an agreement between, or concerted practice engaged in by,— (a) a company, its wholly owned subsidiary as contemplated in section 1(5) of the Companies Act, 1973, a wholly owned subsidiary of that subsidiary or any 40 combination of them; or (b) the constituent firms within a single economic entity similar in structure to those referred to in paragraph (a). Restrictive vertical practices prohibited 5,( 1 ) An agreement between parties in a vertical relationship is prohibited if it has the effect of substantially preventing or lessening competition in a market, unless a party to 45 the agreement can prove that any technological, efficiency or other pro-competitive, gain resulting from that agreement outweighs that effect. (2) The practice of minimum resale price maintenance is prohibited. (3) Despite subsection (2), a supplier or producer may recommend a minimum resale 50 price to the reseller of a good or service provided— (a) the supplier or producer makes it clear to the reseller that the recommendation is not binding; and (b) if the product has its price stated on it, the words “recommended price” appear next to the stated price.

14

>().

19412

GOVERNMENT (; AZF.”mE. .W OCTOBER 1998 C().MPETITI()N ACT, 199x

.Act No. 89, 1998

PART B ABUSE OF A DOMINANT POSITION Restricted application of Part
6. ( 1 ) As soon as prwtkable after ~his Acr comes into operation. and U( inter\ a]~ of ntjt less than five years thereafter. the kfi}]i.s[er mu\t. in consultation with the Competition” 5 Commission, and by notice in the Gu~etfe(C(J determine a threshold of annual turnover. or assets. in the Republic. either in general or in relation to specitic industries. below which [his Part does not apply to a, firm: and (b) provide a method for the calculation of annual turnover 01- assets. 1 () (2) A threshold determined by the Minister in terms of subsection ( 1 ) takes effect \ix months after the date of publication of’ tha[ notice in the Ga;et[t’,

Dominant firms 7. A jirlt~ is dominant in a market if— (u) it has at least 457c of that mtirket: (b) it has at least 35%, but less than 45%, of that market, unless it can show that it does not have murkel pm~vr: or ([) it has less than 35Yc of that marke[. but has marker pmivt-. Abuse of dominance prohibited Z(J 8. It is prohibited for a dominant,firm t{+ (a) charge an exce.ssi~e price to the detriment of consumers; (b) refuse to give a competitor access to an e,s.senriul fbcility when it is economically feasible to do so: (c) engage in an exclusionary act, other than an act listed in paragraph (d), if the anti-competitive efiect of that act outweighs its technological, efficiency or 25 other pro-competitive, gain; or (d) engage in any of the following e.rclusiotmt:v acts, unless the jirm concerned can show technological, efficiency or other pro-competitive, gains which outweigh the anti-competitive effect of its act: (i) requiring or inducing a supplier or customer to not deal with a 30 competitor; (ii) refusing to supply scarce goods to a competitor when supplying those goods is economically feasible: (iii ) selling ,goods or .ser~’ices on condition that the buyer purchases separate goods or ~<rtices unrelated to the object of a contract. or forcing a buyer 35 to accept a condition unrelated to the object of a contract; (iv) selling goods or .service.s below their marginal or average variable cost; or (v) buying-up a scarce supply of intermediate goods or resources required by 40 a competitor, Price discrimination by dominant firm prohibited 9. ( I ) An action by a dominant ,jirm, as the seller of 8oodY or .~er~ices, is prohibited price discrimination, if— (a) it is likely to have the effect of substantially preventing or lessening 45 competition; (b) it relates to the sale, in equivalent transactions. of goods or .~er~’ices of like grade and quality to different purchasers; and (c) it involves discriminating between those purchasers in terms of— (i) the price charged for the goods or ser]ices:

15

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No. 19412

(; OVERXMENT GAZETTE. 30 OCTOBER 1998 COMPETITION AcT. I 998

Act NO. 89, 1998

given or allowed in rekition to the supply of’ ,yood.~ or .serlif t’ \: (iii) the provision of services in respect of [he goods or .YerIicTs: or (iv) payment for services pro\ided in respect ot’ the ,qoods m sen’ices, (2) Despite subsection ( 1 ), conduct in\ol\ing differential treatment of’ purchasers in 5 terms of any matter listed in paragraph (c) ot tha[ subwction is not prohibited price discrimination if the dominant,firm establishes (hat the differential treatmen[— (a) makes only reasonable allowance for differences in cost or likely cost of manufacture, distribution, sale. promotion or delivery resulting from the differing places to which. methods by which. or quantities in which, gowds or 10 ser~’ices are supplied to different purchasers: (b) is constituted by doing acts in good faith to meet a price or benefit offered by a competitor; or (c) is in response to changing conditions affecting the market for the good.! or services concerned, including— 15 (i) any action in response to the actual or imminent deterioration of’ perishable goods: (ii) any action in response to the obsolescence of goods: (iii) a sale pursuant to a liquidation or sequestration procedure: or (iv) a sale in good faith in discontinuance ot’ business in the goods orseriices 20 concerned.
(ii) any discount. allowance. rebate or credit

PART C EXEMPTIONS FROM APPLICATION OF CHAPTER Exemption 10. ( 1 ) Ajrtn may apply to the Competition Commission to exempt an agreement. or 25 practice, or category of either agreements, or practices, from the application of this Chapter. (2) Upon receiving an application in terms of subsection (1), the Competition Commission may— (a) advise the applicant in writing that the ugreemenr, or practice, or category of 30 either agreements, or practices, does not constitute a prohibited practice in terms of this Chapter; (b) grant a conditional or unconditional exemption for a specified term, if the agreement, or practice, or category of either agreements, or practices 35 concerned meets the requirements of subsection (3); or (c) refuse to grant an exemption. (3) The Competition Commission may grant an exemption in terms of subsection (2)(17), if— (a) any restriction imposed on the firms concerned by the agreement. or practice, or category of either agreements, or practices, concerned, is required to attain 40 an objective mentioned in paragraph (b): and (b) the agreement, or practice, or category of either agreements, or practices, concerned, contributes to any of the following objectives: (i) maintenance or promotion of exports: (ii) promotion of the ability of small businesses, orfirnrs controlled or owned 4S by historically disadvantaged persons, to become competitive; (iii) change in productive capacity necessary to stop decline in an industry; or (iv) the economic stability of any industry designated by the Minister. after consulting the minister responsible for that industry. (4) In addition to the provisions of subsections (2) and (3), the Competition 50 Commission may exempt an agreement, or practice, or category of either agreemerus, or practices, that relates to the exercise of a right acquired or protected in terms of the Performers’ Protection Act, 1967 (Act No. 11 of 1967), the Plant Breeder’s Rights Act. 1976 (Act No. 15 of 1976), the Patents Act, 1978 (Act No. 57 of 1978), the Copyright

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No. 19412

GOI’I-.RNAII-.XT G,AZETTE, 30 OCTOBER 1998 C().MPF.TITI()N ACT. 199s

Act No. 89, 1998

Act. 1978 (Act No. 98 of 1978), the Trade Marks Act. 199.? (Act No, 194 of 1993) and the Designs Act, 1993 (Act No. 195 of 1993), (5) The Competition Commission may revoke its v. rit[en ad~ice given in terms of subsection 2(~/). or an exemption granted in terms o! \ubsection ( 2 )(h). if— (a) the advice was given. or the exemption was granted. on the basis of false or 5 incorrect information: (b) a condition for the exemption is not fultilled: or (c) the reason for granting the exemption no longer exists. (6) Before grmting an exemption in terms of subsection (2) or (4). or revoking an exemption in terms of subsection (5), the Competition Commission must— 10 ((/) give notice in the Ga:erre of the application for an exemption. or of its intention to revoke that exemption: and (b) allow interested parties 30 clays from the date of that notice to make written representations as to why the exemption should not be granted or revoked. (7) The Competition Commission must, by notice in the G[[:erte, give notice of any 15 exemption granted or revoked in terms of this section. (8) The firm concerned. or any other person with a substantial material interest atiected by a decision of the Competition Commission in terms of subsection (2)(/2) or (c), or subsections (4) or (5). may appeal against that decision to the Competition Tribunal in the prescribed manner. 20 CHAPTER 3 MERGER CONTROL Restricted application of Chapter 11. ( 1 ) As soon as practicable after this Act comes into operation. and at intervals of not less than five years thereafter, the Mini.sfer must, in consultation with the 25 Competition Commission, and by notice in the Gazette— (a) determine a threshold of combined annual turnover, or assets, in the Republic, either in general or in relation to specific industries, at or below which this Chapter does not apply to a merger; (b) determine a second threshold of combined annual turnover, or assets, in the 30 Republic, either in general or in relation to specific industries, higher than the threshold referred to in paragraph (a). for the purpose of determining categories of mergers in terms of subsection (3); and (c) provide a method for the calculation of annual turnover and assets. (2) A threshold determined by the kfirzi.~tcr in terms of subsection ( I ) takes effect six 35 months after the date of publication of that notice in the Gazette, (3) For the purposes of this Chapter, at any time— (u) “an intermediate merger” means a merger or proposed merger with a value between the then current thresholds established in terms of subsection ( 1 )(a) 40 and (b) respectively: and (b) “a large merger” means J merger or proposed merger with a value at or above the then current threshold established in terms of subsection ( 1 )(h). Merger defined 12. ( 1 ) For the purpose of this Chapter, “merger” means the direct or indirect acquisition or direct or indirect establishment of control. by one or more persons over all 45 significant in~ere.rl.~ in the whole or part of the business of a competitor, supplier. customer or other person. whether that control is achieved as a result of— (u) purchase or lease of the shares. interest, or assets of that competitor. supplier, customer or other person; (b) amalgamation or combination with that competitor, supplier, customer or 50 other person: or (c) any other means.

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No. 19412

GOVERNMENT GAZETTE. 30 OCTOBER 1998 COMPET1TION ACT. 1998

Act No. 89, 1998

(2) A person controls a ,firm if that person— (0)- beneficially owns more than one half of the issued share capital of the firm: (b) is entitled to vote a majority of the votes that may be cast at a general meeting of thejrm, or has the ability to control the voting of a majority of those votes, 5 either directly or through a controlled entity of that person; (c) is able to appoint or to veto the appointment of a majority of the directors of thejrm; (d) is a holding company, and the jirm is a subsidiary of that company as contemplated in section 1(3)(a) of the Companies Act, 1973 (Act No. 61 of 1973); 10 (e) in the case of a firm that is a trust. has the ability to control the majority of the votes of the trustees, to appoint the majority of the trustees, to appoint or change the majority of the beneficiaries of the trust; (f) in the case of a close corporation, owns the majority of members’ interest, or controls directly, or has the right to control the majority of members’ votes in 15 the close corporation; or (g’) has the ability to materially influence the policy of the firm in a manner comparable to a person who, in ordinary commercial practice, can exercise an element of control referred to in paragraphs (a) to (f). Notification of merger required 20

13. ( 1 ) Any party to an intermediate or large merger must notify the Competition Commission of that merger no more than seven days after the earlier of— (u) the conclusion of the merger agr;emenf: (b) the public announcement of a proposed merger bid; or (c) the acquisition by any one of the parties to that merger, of a controlling interesf 25 in another. (2) A party that is required in terms of subsection (1) to notify the Competition Commission of a merger must provide a copy of that notice to a representative trade union representing the employees of any of the merging jirms, and, if there is no representative trade union in one of the merging firms, the notice in respect of that firm, 30 must be directed to-(a) any registered trade union that represents a substantial number of the employees of that jirm; or (b) if there are no registered trade unions in that jirm, the employees concerned, 35 or representatives of the employees concerned. (3) The parties to an intermediate or large merger must not implement that merger until they have received approval from either the Competition Commission in terms of section 14( 1), the Competition Tribunal in terms of section 15(2) or the Competition Appeal Court in terms of section 17. Competition Commission merger proceedings 40

14. ( 1 ) Within 30 days after receiving notice of an intermediate merger, the Competition Commission must— (a) extend the period in which it has to consider the proposed merger by a period not exceeding 60 days, and in that case, issue an extension certificate to any 45 party that notified it of the merger; or (b) after considering the merger in terms of section 16(i) approve the merger by issuing a clearance certificate; (ii) approve the merger subject to any conditions; or (iii) prohibit implementation of the merger. (2) If, upon the expiry of the 30 day period provided for in subsection (1), the 50 Competition Commission has not issued any of the certificates referred to in that subsection, or upon the expiry of an extension period contemplated in subsection ( 1 )(a),

Ad No. 89, 1998

cwwwrrrm .Am I 99x

the Commission has not issued a cer[ific~te referred to in subsection ( 1 )(b). the Commissicm will be deemed to have approvecl the merger. subject to subsection (5), (3) After receiving notice of a large merger, the Competition Commission. must refer that notice to the Competition Tribunal and to the Minister. and must within the 5 prescribed time, t’orwwd to the Competition Tribunal and the Nliois[er a recornrnend~tion whether implementation of the merger should be either — ((/) Jppro\ed: (b) approved subject toimyconditions; or (c) prohibited. (4) Upon making a decision in terms of subsection (1) or (2). or a referml and 10 recommendation in terms of subsection (3), the Competition Commission must — (a) issue written reas(>ns fc~rthe decisic~n ()rrecorllrllerldati() rl:arld (b) publish a notice of the decision. or referral and recommendation, in the Gazette. (5) The Competition Commission may revoke a decision to approve or conditionally 15 approve a merger in terms of subsection ( I ) if — (a) the decision wm based on incorrect information for which a party to the merger is responsible; (b) the approval was obttiined by deceit; or 20 (<) a:firm concerned has bretiched an obligation attached to the decision. (6) Despite the time limits set out in this section. if. in terms of subsection (5). the Competition Commission re\okes a decision to approve ti merger. the Commission may prohibit that merger even though any of those time limits may have elapsed, Competition Tribunal merger proceedings 15. ( 1 ) If the Competition Commission approves a merger subject to any conditions 25 in terms of section 14( I )(b)(ii). or prohibits a merger in terms of section 141 )(b) (iii). a party to the merger may, by written notice in the prescribed form, request the Competition Tribunal to consider the conditions or prohibited merger. (2) Upon receiving a referral of a large merger and recommendation from the Competition Commission in terms of section 14(3), or a request from a party to an 30 intermediate merger in terms of subsection ( 1 ). the Competition Tribunal must consider the merger in terms of section 16. and the recommendation or decision, as the case may be. of the Competition Commission. and must within the prescribed time. ((J) approve the merger; 35 (b) approve the merger subject to any conditions: or (c) prohibit implementation of the merger. (3) Section 14(4). (5) and (6). each read with the changes required by the context. apply to the Competition Tribunal in relation to any merger that it is required to consider in terms of subsection (2), Consideration of Mergers 40

16. ( 1 ) Whenever required to consider a merger. the Competition Commission or Competition Tribunal must initially determine whether or not the merger is likely to substantially prevent or lessen competition, by assessing the factors set out in subsection (~), and— (a) if it appears that the merger is likely to substantially prevent or lessen 45 competition, the Commission or the Tribunal must then determine— (i) whether the merger is likely to result in any technological, efficienc or other pro-competitive. gain which will be greater than. and offset. the effects of any prevention or lessening of competition, that may result or
y

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No. 19412

GOVERNMENT GAZETTE. 3(J OCTOBER 1998 COMPETITION ACT. 1998

Act NO. 89, 1998

is likely to result from the merger, and would not likely be obtained if the merger is prevented: and (ii) whether the merger can or cannot be justified on substantial public interest grounds by assessing the fxtors set out in subsection (3): and (b) otherwise, must determine whether the merger can or cannot be justified on 5 substantial public interest grounds by assessing the factors set out in subsection (3). (2) When determining whether or not a merger is likely to substantially prevent or lessen competition, the Competition Commission or the Competition Tribunal must assess the strength of competition in the relevant market. and the probability that the 10 ,firms in the market after the merger will behave competitively or co-operatively, taking into account any factor that is relevant to competition in that market. including— (i) the actual and potential level of import competition in the market: (ii) the ease of entry into the market. including tariff-and regulatory barriers: (iii) the level, trends of concentration, and history of collusion, in the market: 15 (iv) the degree of countervailing power in the market: (v) the likelihood that the acquisition would result in the mergedjirm having mut-ket power; (vi) the dynamic characteristics of the market. including growth, innovation, 20 and product differentiation: (vii) the nature and extent of vertical integration in the market: (viii) whether the business or part of the business of a party to the merger or proposed merger has failed or is likely to fail; and (ix ) whether the merger will result in the removal of an effective competitor. (3) When determining whether a merger can or cannot be justified on public interest 25 grounds. the Competition Commission or the Competition Tribunal must consider the effect that the merger will have on— (i) a particular industrial sector or region; (ii) employment; (iii) the ability of small bu,sines.ses, or jirms controlled or owned by 30 historically disadvantaged persons, to become competitive; and (iv) the ability of national industries to compete in international markets. Competition Appeal Court Merger Proceedings 17. ( 1 ) Within 30 days after notice of a decision by the Competition Tribunal in terms of section 15(2), a party to the merger, or any other person who. in terms of section 35 13(2), is required to be given notice of the merger, may appeal to the Competition Appeal Court from that decision, and the Court must either— (a) set aside the decision of the Tribunal: (b) amend that decision by ordering restrictions or by including conditions: or 40 (c) confirm that decision. Minister may participate in proceedings 18, In order to make representations on any public interest ground referred to in section 16(3), the Minister may participate as a party in any merger proceedings before the Competition Commission, the Competition Tribunal or the Competition Appeal Court, in the manner provided for in rules made in terms of section 21 (4), 27(2) or 45 38( 1 )(c). respectively.

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(io\”I,Rs>lExTG AZETTF..300CT’OBER COMPETITION ACT. 1998

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Act No. 89, 1998

CHAPTER 4 COMPETITION COMMISSION. TRIBUNAL AND COURT PART A THE COMPETITION CON1M1SS1ON Establishment and constitution of Competition Commission 19. ( 1 ) There is hereby established a body to be known as the Competition Commission, which— (a) has jurisdiction throughout the Republic: (b) is a juristic person; and (c) must exercise its functions in accordance with [his Acf. (2) The Competition Commission consists of the Commissioner and one or mot-e Deputy Commissioners as may be necessary, appointed by the kfini,~fer in terms of this Act. Independence of Competition Commission 20. ( 1 ) The Competition Commission— (u) is independent and subject only to the Con.srimtion and the low: and (b) must be impartial and must perform its functions without fear, fiavour, or prejudice. (2) The Commissioner, each Deputy Commissioner and each member of the staff of the Competition Commission, must not— (a) engage in any activity that may undermine the integrity of the Commission; (b) participate in any investigation, hearing or decision concerning a matter in respect of which that person has a direct financial interest or any similar personal interest; (c) make private use of, or profit from, any conjidenrial information obtained as a result of performing that person’s official functions in the Commission; or (d) divulge any information referred to in paragraph 2(c) to any third party, except as required as part of that person’s official functions within the Commission. (3) Each organ of state must assist the Commission to maintain its independence and impartiality, and to effectively carry out its powers and duties. Functions of Competition Commission 21. ( 1 ) The Competition Commission is responsible to— (u) implement measures to increase market transparency; (b) implement measures to develop public awareness of the provisions of rhis Acr; 35 (c) investigate and evaluate alleged contravention of Chapter 2; (d) grant or refuse applications for exemption in terms of Chapter 2; (e) authorise, with or without conditions, prohibit or refer mergers of which it receives notice in terms of Chapter 3; (f) negotiate and conclude consent orders in terms of section 63; (g) refer matters to the Competition Tribunal, and appear before the Tribunal, as 40 required by this Act; (h) negotiate agreements with any r<gu/aton’ aurhoriry to co-ordinate and harmonise the exercise of jurisdiction over competition mattep within the relevant industry or sector. and to ensure the consistent application of the 45 principles of this Act: (i) participate in the proceedings of any regulatory uuthot-ity; (j) advise, and receive advice from any regulatory authority: [s 5

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Act No. 89, 1998

(k) over time, review legislation and public regulations, and report to the Minister concerning any provision that permits uncompetitive behaviour; and (I) deal with any other matter referred to it by the Tribunal. (2) In addition to the functions listed in subsection ( 1), the Competition Commission may— (u) report to the Minister on any matter relating to the application of fhis Act: (b) enquire into and report to the Minister on any matter concerning the purposes of this Act; and (c) perform any other function assigned to it in terms of this or any other Act. (3) The Minister must table in the National Assembly any report submitted in terms of subsection (I)(k), and any report submitted in terms of subsection (2) if that report deals with a substantial matter relating to the purposes of this Act— (a) within 14 days after receiving that report from the Competition Commission, if Parliament is in session at that time; or (b) if Parliament is not in session, within 14 days after the commencement of the next session. (4) The Minister may, in consultation with the Competition Commission, and by notice in the Gazette, prescribe regtdafions for matters relating to the functions of the Commission, including— ‘ (a) f o r m s ; (b) time periods; (c) information required; (d) additional definitions; (e) filing fees; (f) access to confidential infbrrnution; (g) manner and form of participation in Commission procedures; and (h) procedures. Appointment of Commissioner 22. (1) The Minister must appoint a person with suitable qualifications and experience in economics, law, commerce, industry or public affairs to be the Commissioner for a term of five years. (2) The Minister may re-appoint a person as Commissioner at the expiry of that person’s term of office. (3) The Commissioner, who is the Chief Executive Officer of the Competition Commission, is responsible for the general administration of the Commission and for carrying out any functions assigned to it in terms of [his Acr, and must— (a) perform the functions that are conferred on the Commissioner by or in terms of this Act; (b) manage and direct the activities of the Commission; and (c) supervise the Commission’s staff. (4) The Minister must, in consultation with the Minister of Finance, determine the Commissioner’s remuneration, allowances, benefits, and other terms and conditions of employment. (5) The Commissioner, on one month written notice addressed to the Minister, may resign as Commissioner. (6) The Minister— (a) must remove the Commissioner from office if that person becomes subject to any of the disqualifications referred to in section 28(3)(a) to (d); and (b) other than as provided in paragraph (a), may remove the Commissioner from office only for— (i) serious misconduct; (ii) permanent incapacity; or (iii) engaging in any activity that may undermine the integrity of the Competition Commission.

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COMPETITION .4 CT. 1998

Appointment of Deputy Commissioner 23. ( 1 ) The k’ilii.~fe) must appoint tit leas( one person, and may appoint other perstms. with suitable qualification\ tind ex~erience in economics, law, commerce. industry or public affairs as Deputy Commissi&sr to assist the Commissioner in carrying out the function\ of the Competition Con]missicm. (2) The Minisrer must designate a Deputy Commissioner to perform the t’unc[ions of the Commissioner wheneverthe Commissioner is unable for any reason to perform the func[io[ls ot’ the Commissioner; or (b) the office of Commissioner is vacant. Appointment of inspectors 24. ( 1 ) The Commissioner mtiy appoint any person in the service of the Competition Commission, or any other suit~bie person. us an inspector. (2) The Mini.sfer may. in consultation with the Minister of Finance, determine the remuneration paid to a person mho is tippointed in terms of subsection ( 1), but who is not 15 in the full-time service of the Competition Commission. (3) An inspector must be provided with a certificate of appointment signed by tbe Commissioner stating that the person has been appointed as an inspector in terms of [his Act. (4) When an inspector performs any function in terms of Chapter 5. the inspector 20 nlust(a) be in possession of a certificate of appointment issued to that inspector in terms of subsection (3); and (/2) show that certificate to any person wh~ ‘)5 (i) is affected by the exerci$e of the functions of the inspector; and (ii) requests to see the certificate. Staff of Competition Commission 25. ( 1 ) The Commissioner n~ay— (~~) appoint staff, or contract with other persons. to assist the Competition 30 Commission in carrying out its functions; and (b) in consultation with the Minis[er and the Minister of Finance, determine the remuneration, allowances, benefits, and other terms and conditions of appointment of each member of the staff. PART B THE COMPETITION TRIBUNAL Establishment and constitution of Competition Tribunal 26. ( 1 ) There is hereby established a body to be known as the Ccynpetition Tribunal, which— (a) has jurisdiction throughout the Republic: 40 (b) is a juristic person; (c) is a Tribunal of record; and (d) must exercise its functions in accordance with this A([. (2) The Competition Tribunal consists of a Chairperson and not less than three. but not more than ten, other women or men appointed by the President, on a full or parr-time basis, on the recommendation of the Minister, from among persons nominated by the 45 Mini.~tereither on the A4i/~i.~ter k initiative or in response to a call for nominations, which must be published by the Minister in the GcI:e[te. (3) The President must(a) appoint the Chairperson and other members of the Competition Tribunal on 50 the date that rhi.s Act comes into operation; and (b) appoint a person to fill any vacancy on the Tribunal. (4) Section 20. read with the changes required by the context, applies to the Competition Tribunal. 35

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GOVERNMENT GAZETTE. 30 OCTOBER 1998 COMPETITION ACT. 1998

Act No. 89, 1998

Functions of Competition Tribunal 27. ( 1 ) Upon a matter being referred to it in terms of [his Acr. the Competition Tribunal may— (a) grant an exemption from a relevant provision of this Act; 5 (b) authorise a merger, with or without conditions, or prohibit a merger; (c) adjudicate in relation to any conduct prohibited in terms of Chapter 2 or 3, by determining whether prohibited conduct has occurred. and if so. impose a remedy provided for in Chapter 6; or (d) grant an order for costs in terms of section 57. (2) Section 2 I (4), read with the changes required by the context, applies to the 10 Competition Tribunal. Qualifications of members of Competition Tribunal 28. ( 1 ) The Chairperson and other members of the Competition Tribunal, viewed collectively must— (a) represent a broad cross-section of the population of the Republic; and (b) comprise sufficient persons with legal training and experience to satisfy the requirements of section 3 l(2)(a). (2) Each member of the Competition Tribunal must— (a) be a citizen of South Africa, who is ordinarily resident in South Africa; (b) have suitable qualifications and experience in economics, law, commerce, industry or public affairs; and (c) be committed to the purposes and principles enunciated in section 2. (3) A person may not be a member of the Competition Tribunal if that person— (a) is an office-bearer of any party, movement, organisation or body of a partisan political nature; (b) is an unrehabilitated insolvent; (c) is subject to an order of a competent court holding that person to be mentally unfit or disordered; or (d) has been convicted of an offence committed after the Constitution of the Republic of South Africa. 1993 (Act No. 200 of 1993), took effect, and sentenced to imprisonment without the option of a fine. Term of office of members of Competition Tribunal 29. (1) Subject to subsection (2), the Chairperson and each other member of the Competition Tribunal serves for a term of five years. (2) The President may re-appoint a member of the Competition Tribunal at the expiry 35 of that member’s term of office, but no person may be appointed to the office of the Chairperson of the Tribunal for more than two consecutive terms. (3) The Chairperson, on one month written notice addressed to the Minister, may— (a) resign from the Competition Tribunal; or (b) resign as Chairperson, but remain as a member of the Tribunal. 40 (4) A member of the Competition Tribunal other than the Chairperson may resign by giving at least one month’s written notice to the Minister. (5) The President, on the recommendation of the Minister, — (a) must remove the Chairperson or any other member of the Competition Tribunal from office if that person becomes subject to any of the disqualify- 45 cations referred to in section 28(3); and (b) other than as provided in subsection (a), may remove the Chairperson or a member from office only for— (i) serious misconduct; 50 (ii) permanent incapacity; or (iii) engaging in any activity that may undermine the integrity of the Tribunal.

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(;( )\ F. KS\lENl GAZETTF. 30 OCTOBER 1998 CokfPETITI()\ ,+,CI’. 19[)8

Ad No. 89, 1998

Deputy Chairperson of Competition Tribunal 30. ( 1 ) The President must. on the rec{][]llllelld:itiol] O( the Mini.srer. designa[c a member of the Competition” Tribunal as Deput! Chairperson c~t’ the Tribunal. (2) The Deputy Chairperson performs the t’unction\ of Chairperson whenever— (a) the office of Chairperson is vacant: or (b) the Chairperson is for any other reason [temporarily unable to perform [hc functions of Chairperson. Competition Tribunal proceedings 31. ( I ) The Chairperson is responsible to mtinage the caseloud of the Competition Tribunal. and must assign each matter referred to the Tribunal to a panel composed of any three members of the Tribunal. (2) When assigning a matter in term\ of subsection ( I ). the Chairperson must— ((/) ensure that at least one member of the panel is a person who has legal training and experience: and (b) designate a member of the panel to preside over the panel’s proceedings. (3) If. because of withdrawal from a hearing in terms of section 32. resignation. illness or death, a member of the panel is unable to complete the proceedings in a matter assigned to that panel, the Chairperson must— (a) direct that the hearing of that matter proceed before any remaining member+ of’ the panel subject to the requirements of subsection (2)(u); or (b) terminate the proceedings before that panel and constitute another panel. which may include any member of the original panel. and direct that panel to conduct a new hearing. (4) The decision of a panel on a matter referred to it must be in writing and include reasons for that decision. (5) A decision of a majority of the members of a panel is the decision of the Tribunal. Conflicts and disclosure of interest by members of Competition Tribunal 32. ( 1 ) A member of the Tribunal may not represent any person before a panel of the Tribunal. (2) If, during a hearing, it appears to a member of the Competition Tribunal that a 30 matter concerns a financial or other interest of that member contemplated in section ~()(~)(b), [hat member n~us[— (a) immediately and fully disclose the fact and nature of that interest to the Chairperson and to the presiding member at that hearing: and 35 (b) withdraw from any further involvement in that hearing. Acting by member of Competition Tribunal after expiry of term of office 33. If, on the expiry of the term of office of a member of the Competition Tribunal, that member is still considering a matter before the Tribunal, that member may continue to act as a member in respect of that matter only. Remuneration and benefits of members of Competition Tribunal 40

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34. ( 1 ) The Minister may, in consultation with the Minister of Finance, determine the remuneration, allowances, and other benefits of the Chairperson. Deputy Chairperson and other members of the Competition Tribunal. (2) The Minis?er may not during the term of office of a member of the Competition 45 Tribunal, reduce the member’s salary, allowances or benefits. (3) The Minisler may determine any other conditions of appointment not provided for in this section. Staff of Competition Tribunal 35. The Chairperson may— (a) appoint staff. or contract with other persons. to assist the Competition Tribunal in carrying out its functions; and 50

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GOVERNMENT GAZEITE, 30 OCTOBER 1998 COMPETITION ACT, 1998

Act No. 89, 1998

(b) in consultation with the Minis?er and the Minister of Finance, determine the remuneration, allowances. benefits, and other terms and conditions of appointment of a member of the staff. PART C THE COMPETITION APPEAL COURT Establishment and constitution of Competition Appeal Court 36. (1) There is hereby established a court to be known as the Competition Appeal Court, which — (a) is a court contemplated in section 166(e) of the Constitution with a status 1(I similar to that of a High Court; (b) has jurisdiction throughout the Republic; and (c) is a court of record. (2) The Competition Appeal Court consists of members appointed by the President in accordance with section 174 of the Constitution, and comprises— (a) at least three members, each of whom is a judge of the High Court, and one of 15 whom must be designated by the President to be Judge President of the Competition Appeal Court; and (b) two other members, each of whom— (i) is a citizen of South Africa, and is ordinarily resident in the Republic; (ii) has suitable qualifications and experience in economics, Iawi commerce, 20 industry or public affairs; and (iii) is committed to the purposes and principles mentioned in section 2. Function of Competition Appeal Court 37. (1) The Competition Appeal Court may consider any appeal from, or review of, a 25 decision of the Competition Tribunal. (2) The Competition Appeal Court may— (a) confirm, amend or set aside a decision or order that is the subject of an appeal or review from the Competition Tribunal; and (b) give any judgment or make any order that the circumstances require. Business of Competition Appeal Court 30 5

38. (1) The Judge President of the Competition Appeal Court— (a) is responsible to supervise and direct the work of the Court; (b) must preside at proceedings of the Court; and (c) by notice in the Gazette, may make rules for the proceedings of the Court. (2) A matter before the Competition Appeal Court must be heard by the full Court. 35 (3) The decision of a majority of the members of the Competition Appeal Court is the decision of the Court. (4) Despite subsection (2) and (3), any matter of law arising for decision by the Competition Appeal Court, and any question as to whether a matter for decision is a matter of fact or a matter of law, must be decided only by the members appointed in 40 terms of section 36(2)(a), and a decision by a majority of them is the decision of the court. (5) A decision of the Competition Appeal Court must be in writing and include reasons for that decision. Terms of o!%ce of members of Competition Appeal Court 39. (1) Subject to subsection (2)— (u) sections 26(3) and 33, each read with the changes required by the context, apply to the Competition Appeal Court; and 45

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GOVERNMENTG AZETTE.300CTOBER 1998 COMPETITION ACT. 1998

Act No. 89, 1998

(b) Sections 28,29, 32, and 34 each read with the changes required by the context, apply to the members of the Court appointed in terms of section 36(2)(b). (2) In addition to the provisions of’ subsection ( I )(a). the following rules apply to the Judge President and each other member of the Competition Appeal Court appointed in terms of section 36(2)(a): (a) A member is appointed for a tixed term determined by the President at the time of appointment, (b) a member may resign from the Court by giving written notice to the President, (c) a member holds office until— (i) the member’s term of office in the Court ends; (ii) the member’s resignation takes effect; (iii) the member is removed from office: or (iv) the member ceases to be a judge of the High Court. (3) The Judge President is appointed for a fixed term determined by the President at the time of appointment, (4) The Judge president may resign from the Competition Appeal Court by giving written notice addressed to the President. (5) A person holds office as Judge President of the Competition Appeal Cofirt until— (a) that person’s term of office in the Court ends: (b) that person’s resignation takes effect; (c) that person is removed from office: or (d) that person ceases to be a judge of the High Court. (6) The tenure of office. the remuneration, and the terms and conditions of appointment applicable to a judge of the High Court in terms of the Judges Remuneration and Conditions of Employment Act, 1989 (Act No. 88 of 1989). are not affected by that judge’s appointment and concurrent tenure of office as a member of the Competition Appeal Court appointed in terms of section 36(2)(u). (7) A member of the Competition Appeal Court, appointed in terms of section 36(2)(a)— (a) may be removed from the Court only if that person has first been removed from office as a judge of the High Court; and (b) upon being removed as a judge of the High Court, must be removed from office as a judge of the Competition Appeal Court. PART D ADMINISTRATIVE MATTERS CONCERNING THE COMPETITION COMMISSION AND THE COMPETITION TRIBUNAL Finances

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40. ( 1 ) The Competition Commission is financed from— (a) money that is appropriated by Parliament for the Commission: 40 (b) fees payable to the Commission in terms of this Act; (c) income derived by the Commission from its investment and deposit of surplus money in terms of subsection (6); and (d) money received from any other source. (2) The financial year of the Competition Commission is the period from 1 April in any year to 31 March in the following year, except that the first financial year of the 45 Commission begins on the date that this Act comes into operation, and ends on 3 I March next following that date. (3) Each year, at a time determined by the Minister, the Commissioner must submit to the Minister a statement of the Competition Commission’s estimated income and expenditure, and requested appropriation from Parliament, in respect of the next ensuing 50 financial year. (4) The Competition Commission must open and maintain an account in the name of the Commission with a registered bank, or other registered financial institution, in the Republic, and— (a) any money received by the Commission must be deposited into that account; 55 and (b) every payment on behalf of the Commission must be made from that account.

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COMPETITION ACT. 199X

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(5) Cheques drawn on the account of the Competition Commission must be signed on its behalf by two persons authorised for that purpose by resolution of the Commission. (6) The Competition Commission may invest or deposit money of the Commission that is not immediately required for contingencies or to meet current expenditures— (a) on a call or short-term fixed deposit with any registered bank or financial institution in the Republic: or (b) in an investment account with the Corporation for Public Deposits established by section 2 of the Corporation for Public Deposits Act, 1984 (Act No. 46 of 1984). (7) The Commissioner— (a) is the accounting officer of the Competition Commission in terms of the Exchequer Act, 1975, (Act No. 66 of 1975); and (b) is accountable for all money that the Commission receives or pays, and must keep the accounting records required by that Act. (8) The Competition Commission— (a) is exempt from the provisions of the Exchequer Act, 1975, subject to subsection (7); (b) is exempt from the provisions of the State Tender Board Rules; and (c) is subject to the provisions of the Reporting by Public Entities Act, 1992 (Act No. 93 of 1992). (9) Within six months after the end of each financial year, the Commissioner must prepare financial statements in accordance with established accounting practice. principles and procedures, comprising— (a) a statement reflecting, with suitable and sufficient particulars, the income and expenditure of the Competition Commission during the preceding financial year; and (b) a balance sheet showing the state of its assets, liabilities and financial position as at the end of that financial year. (10) The Auditor General must audit the Competition Commission’s financial records each year. Annual Report

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41. (1) Within six months after the end of the Competition Commission’s financial year, the Commissioner must prepare and submit to the Minister an annual report in the prescribed form, including— 35 (u) the audited fina~cial statements prepared in terms of section 40(9); (b) the auditor’s report prepared in terms of section 40(10); (c) a report of activities undertaken in terms of its functions set out in this Act; (d) a statement of the progress achieved during the preceding year towards realization of the purposes of this Act; and (e) any other information that the Minister, by notice in the Guzeffe, determines. 40 (2) The M~nis?er must table in the National Assembly each annual report submitted in terms of subsection (1) — (a) within 14 days after receiving that report from the Competition Commission, if Parliament is in session at that time; or (b) if Parliament is not in session, within 14 days after the commencement of the 45 next session. Rules applicable to Competition Tribunal 42. Sections 40 and41, each read with the changes required by the context, applies to the Competition Tribunal, except that a reference in either section to the Commissioner 50 must be read as referring to the Chairperson of the Tribunal.

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GOVEKNhlENTG,4ZETTE:,300 CTOBER” 1998 C[)MPETITION ACT. 1998

Act No. 89, 1998 Liability

43. ( 1 ) The State Li~bility Act. 1957 (Act No. 20 of 1957). read with the chimge\ required by the context. applies to the Competition Commission md to the Competition Tribunal. but a reference in that Act to “the Minister of’(he Department concerned’” must be interpreted as referring to the Commissioner. or [o the Chairperson, as the case mfiy be. (2) No Competition Tribunal member. Competition Appeal Court member. Commissioner, staff person or contractor is liable for any report. finding. point of’ \iew or recommendation that is given in good faith and is \ubmitted to Parliament. or made known, under the Cotlstit[ltion or this A(I. CHAPTER 5 COMPETITION TRIBUNAL PROCEDURES Initiating a complaint 44. A complaint against a prohibited pra(ti~e by a fit-m may be initiated by the Commissioner, or submitted to the Competition Commission by any person in the prescribed manner. Investigation by Competition Commission 45. ( 1 ) Upon initiating or receiving a complaint in terms of section 44, the Commissioner must direct an inspector to investigate the complaint as quickly as practicable. (2) At any time during an investigation, the Commissioner may designate one or more persons to assist the inspector conducting the investigation. (3) A person questioned by an inspector conducting an investigation must answer each question truthfully and to the best of that person’s ability. but a person is not obliged to answer any question if the answer is self-incriminating. (4) At any time during an investigation, the Commissioner may summon any person who is believed to be able to furnish any information on the subject of the investigation, or to have possession or control of any book. document or other object that has a bearing on that subject— (a) to appear before the Commissioner or a person authorised by the Conlmissioner, to be interrogated at a time and place specified in the summons: or (b) to deliver or produce to the Commissioner, or a person authorised by the Commissioner, any book, document or other object referred to in paragraph (a) at a time and place specified in the summons. (5) No self-incriminating answer given or statement made by any person to an inspector exercising powers in terms of this section will be tidmissible as evidence against that person in criminal proceedings against that person instituted in any court. except in criminal proceedings for perjury or in which that person is tried for an offence contemplated in section 72 or section 73(2)(d). and then only to the extent that the 40 answer or statement is relevant to prove the offence charged. Authority to enter and search under warrant 46. (1) A judge of the High Court, a regional magistrate or a magistrate may issue a warrant to enter and search any premises that are within the jurisdiction of that judge or magistrate, if, from information on oath or affirmation, there are reasonable grounds to 45 believe that — (a) a l~r~~ltibitedprcicti(e has taken place. is taking place or is likely to take place on or in those premises; or (b) that anything connected with an investigation into that prohibited i~ractice is in the possession ot’ or under the control of, a person who is on or in those 50 premises. (2) A warrant to enter and search may be issued at any time and must specifically — (a) identify the premises that may be entered and searched: and

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COMPETITION ACT, 1998

(b) authorise an inspector or a police officer to enter and search the premises and to do anything listed in section 48. (3) A warrant to enter and search is valid until one of the following events occurs: (a) the warrant is executed; (b) the warrant is cancelled by the person who issued it or, in that person’s 5 absence, by a person with similar authority; (c) the purpose for issuing it has lapsed; or (d) the expiry of one month after the date it was issued. (4) A warrant to enter and search may be executed only during the day, unless the judge, regional magistrate, or magistrate who issued it authorises that it may be executed 10 at night at a time that is reasonable in the circumstances. (5) A person authorised by warrant issued in terms of subsection (2) may enter and search premises named in that warrant. (6) Immediately before commencing with the execution of a warrant, a person 15 executing that warrant must— (a) if the owner, or person in control, of the premises to be searched is present— (i) provide identification to that person and explain to that person the authority by which the warrant is being executed; and (ii) hand a copy of the warrant to that person or to the person named in it; or (b) if none of those persons is present, affix a copy of the warrant to the premises 20 in a prominent and visible place. Authority to enter and search without warrant 47. (1) An inspector who is not authorised by a warrant in terms of section 46(2) may enter and search premises other than a private dwelling. (2) Immediately before entering and searching in terms of this section, the inspector 25 conducting the search must provide identification to the owner or person in control of the premises and explain to that person the authority by which the search is being conducted, and must either— (a) get permission from that person to enter and search the premises; or (b) believe on reasonable grounds that a warrant would be issued under section 46 30 if applied for, and that the delay that would ensue by first obtaining a warrant would defeat the object or purpose of the entry and search. (3) An entry and search without a warrant may be carried out only during the day, unless doing it at night is justifiable and necessary in the circumstances. Powers to enter and search 35

48. (1) A person who is authorised under section 46 or 47 to enter and search premises may— (a) enter upon or into those premises; (b) search those premises; (c) search any person on those premises if there are reasonable grounds for 40 believing that the person has personal possession of an article or document that has a bearing on the investigation; (d) examine any article or document that is on or in those premises that has a bearing on the investigation; (e) request information about any article or document from the owner of, or 45 person in control of, the premises or from any person who has control of the article or document, or from any other person who may have the information; (j” take extracts from, or make copies of, any book or document that is on or in the premises that has a bearing on the investigation;

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GOVERNMENT GAZETTE, 30 OCTOBER 199X COMPETITION ACT, 1998

Act No. 89, 1998

(g) use any computer system on the premises. or require assistance of any person on the premises to use that computer system, to — (i) search any data contained in or available to that computer system: (ii ) reproduce any record from that data; and (iii) seize any output from that computer for examination and copying: and 5 (h) attach and, if necessary, remove from the premises for examination and safekeeping anything that has a bearing on the investigation. (2) Section 45(5) applies to an answer given or statement made to an inspector in terms of this section. (3) An inspector authorised to conduct an entry and search in terms of section 46 or 10 47 may be accompanied and assisted by a police oflicer. Conduct of entry and search 49. ( 1 ) A person who enters and searches any premises under section 48 must conduct the entry and search with strict regard for decency and order, and with regard for each person’s right to dignity, freedom. security and privacy. 15 (2) During any search under section 48( 1 )(c), only a female inspector or police officer may search a female person, and only a male inspector or police officer may search a male person. (3) A person who enters and searches premises under section 48, must before questioning anyone— 20 (a) advise that person of the right to be assisted at the time by an advocate or attorney; and (b) allow that person to exercise that right. (4) A person who removes anything from premises being searched must— (a) issue a receipt for it to the owner of, or person in control of, the premises; and 25 (b) return it as soon as practicable after achieving the purpose for which it was removed. (5) During a search, a person may refuse to permit the inspection or removal of an article or document on the grounds that it contains privileged information. (6) If the owner or person in control of an article or document refuses in terms of 3(I subsection (5) to give that article or document to the person conducting the search, the person conducting the search may request the registrar or sheriff of the High Court that has jurisdiction to attach and remove the article or document for safe custody until that court determines whether or not the information is privileged. (7) A police officer who is authorised to enter and search premises under section 46, 35 or who is assisting an inspector who is authorised to enter and search premises under section 46 or 47, may overcome resistance to the entry and search by using as much force as is reasonably required, including breaking a door or window of the premises. (8) Before using force in terms of subsection (7), a police officer must audibly demand admission and must announce the purpose of the entry, unless it is reasonable to believe 40 that doing so may induce someone to destroy or dispose of an article or document that is the object of the search. (9) The Competition Commission may compensate anyone who suffers damage because of a forced entry during a search when no one responsible for the premises was 45 present. Outcome of complaint 50. After completing its investigation, the Competition Commission must — (a) refer the matter to the Competition Tribunal, if it determines that a prohibited practice has been established; or (b) in any other case, issue a notice of non-referral to the complainant in the 50 prescribed form.

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Referral to Competition Tribunal 51. ( 1 ) If the Competition Commission issues a notice of non-referral in response to a complaint, the complainant concerned may refer the matter directly to the Competition Tribunal. (2) A referral to the Competition Tribunal, whether by the Competition Commission 5 in terms of section 50(a), or by a complainant in terms of subsection ( 1), must be in the prescribed form. (3) The Chairperson of the Competition Tribunal must, by notice in the Gucerte. publish each referral made to the Tribunal. (4) The notice published in terms of subsection (3) must include — 10 (u) the name of the jirm whose conduct is the subject of the referral; and (b) the nature of the conduct that is the subject of the referral. Hearings before Competition Tribunal 52. (1) The Competition Tribunal must conduct a hearing into every matter referred to it in terms of section 50(a) or section 51 ( 1), 15 (2) The Competition Tribunal must conduct its hearings in public — (u) in an inquisitorial manner; (b) as expeditiously as possible; (c) as informally as possible; and 20 (d) in accordance with the principles of natural justice. (3) Despite subsection (2), the Tribunal member presiding at a hearing may exclude members of the public, or specific persons or categories of persons, from attending the proceedings— (a) if evidence to be presented is confidential information, but only to the extent 25 that the information cannot otherwise be protected; (b) if the proper conduct of the hearing requires it; or (c) for any other reason that would be justifiable in civil proceedings in a High court. (4) At the conclusion of a hearing, the Competition Tribunal must make any order 30 permitted in terms of Chapter 6, and must issue written reasons for its decision. (5) The Competition Tribunal must provide the participants and other members of the public reasonable access to the record of each hearing, subject to any ruling to protect confidential information made in terms of subsection (3)(a). Right to participate in hearing 53. The following persons may participate in a hearing contemplated in section 52, in 35 person or through a representative, and may put questions to witnesses and inspect any books, documents or items presented at the hearing: (u) the Commissioner, or any person appointed by the Commissioner; (b) the complainant; 40 (c) the jirm whose conduct forms the basis of the hearing; and (d) any other person who has a material interest in the hearing, unless, in the opinion of the presiding member of the Competition Tribunal, that interest is adequately represented by another participant. Powers of member presiding at hearing 45 54. The member of the Competition Tribunal presiding at a hearing may— (a) direct or summon any person to appear at any specified time and place; (b) question any person under oath or affirmation; (c) summon or order any person— (i) to produce any book, document or item necessary for the purposes of the 50 hearing; or (ii) to perform any other act in relation to this Act; and (d) give directions prohibiting or restricting the publication of any evidence given to the Competition Tribunal.

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GOVERNMENT GAZETTE, 30 OCTOBER 1998 COMPETITION ACT. i 99X

Act No. 89.1998 Rules of procedure

55. Subject to the Competition Tribunal’s rules of procedure, the Tribunal member presiding at a hearing may determine any matter of procedure for that hearing. with due regard to the circumstances of the c~ise. and the requirements of section 52(2). Witnesses
5

56. ( 1 ) Every person giving evidence at a hearing of the Corrlpetition Tribunal must answer any relevant question. (2) The law regarding a witness’ privilege in a criminal case in a court of IUW applies equally to a person who provides information during a hearing. (3) The Competition Tribunal may order a person to answer any question, or to 1() produce any article or document, even if it is self-incriminating to do so. (4) Section 45(5) applies to evidence given by a witness in terms of this section. costs 57. ( 1 ) Subject to subsection (2), each party participating in a hearin: must bear its 15 own costs. (2) If the Competition Tribunal— (u) has not made a finding against a rcspomiem, the Tribunal member presiding at a hearing may award costs to the w.spondenf. and against a complainant who referred the complaint in terms of section 51 ( 1): or (b) has made a finding against a respondetlt, the Tribunal member presiding at a 20 hearing may award costs against the respondent. and to a complainant who referred the complaint in terms of section 51 ( 1). Appeals 58. (1) Subject to the rules of the Competition Appeal Court, a participant in a hearing 25 referred to in section 53 may — (u) appeal against any decision of the Competition Tribunal, other than a decision in terms of section 62(3), to the Competition Appeal Court; or (b) apply to the Competition Appeal Court to review a decision of the Competition Tribunal. (2) The Competition Appeal Court may make an order for the payment of costs 30 against any party in the hearing, or against any person who represented a party in the hearing, according to the requirements of the law and fairness. (,3) A judgment of the Competition Appeal Court is binding on the Competition Tribunal, and the Competition Commission. CHAPTER 6 REMEDIES AND ENFORCEMENT Interim relief 59. ( 1 ) At any time, whether or not a hearing has commenced into an alleged prohibi~ed practice, a person referred to in section 44 may apply to the Competition Tribunal for an interim order in respect of that alleged practice, and the Tribunal rmry 40’ grant such an order if— (a) there is evidence that a prohibited practice has occurred; (b) an interim order is reasonably necessary to(i) prevent serious, irreparable damage to that person: or 45 (ii) to prevent the purposes of this Ac[ being frustrated; (c) the respondent b+ been given a reasonable opportunity to be heard, having regard to the urgency of the proceedings; and 35

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GOVERNMENT GAZETTE. 30 OCTOBER 1998 COMPETITION ACT. 1998

Act No. 89, 1998

(d) the balance of convenience favours the granting of the order, (2) An interim order in terms of this section must not extend beyond the earlier of(a) the conclusion of a hearing into the alleged prohibited practice; or (b) the date that is six months after the date of issue of the interim order. (3) If an interim order has been granted, and a hearing into that matter has not been concluded within six months after the date of that order, the Competition Tribunal, on good cause shown, may extend the interim order for a further period not exceeding six months. Orders of Competition Tribunal

5

60. (1) In addition to its other powers in terms of’ [his Act, the Competition Tribunal 10 may— (a) make an appropriate order in relation to a prohibited practice, including— (i) interdicting any prohibited practice; (ii) ordering a party to supply or distribute goods or services to another party 15 on terms reasonably required to end a prohibited practice; (iii) imposing an administrative fine, in terms of section 61, with or without the addition of any other order in terms of this section; (iv) ordering divestiture, subject to section 62; (v) declaring conduct of a ,jimn to be a prohibited practice in terms of [his Act, for the purposes of section 65; 20 (vi) declaring the whole or any part of an agreement to be void; (vii) ordering access to an essentialfacility on terms reasonably required; (b) confirm a consent agreement in terms of section 63 as an order of the Tribunal; (c) ~ndone any breach of its rules and procedures on good cause shown. 25 (2) At any time, the Competition Tribunal may adjourn a hearing for a reasonable period of time, if there is reason to believe that the hearing relates to a prohibited practice that might qualify for exemption in terms of section 10. (3) Despite any other provision of this Acr, if the Competition Tribunal adjourns a hearing in terms of subsection (2), the respondent may apply for an exemption during 30 that adjournment. Administrative fines 61. (1) The Competition Tribunal may impose an administrative penalty only— (a) for a prohibited practice in terms of sections 4( l)(b), 5(2) or 8(a), (b) and (d); (b) for a prohibiledprac~ice in terms of sections 4(1 )(a), 5( 1 ), 8(c) or 9( 1 ), if the 35 conduct is substantially a repeat by the same$rm of conduct previousl y found by the Tribunal to be a prohibited practice; or (c) if the parties to a merger have— (i) failed to give notice of the merger as required by section 13; (ii) proceeded to implement the merger in contravention of a decision by the 40 Competition Commission or the Competition Tribunal to prohibit that merger; (iii) proceeded to implement the merger in a manner contrary to a condition for the approval of that merger imposed by the Commission in terms of 45 section 14, or the Tribunal in terms of section 15; or (iv) proceeded to implement the merger without the approval of the Commission or the Tribunal. (2) An administrative fine imposed in terms of subsection(1) may not exceed 10% of the jirm 3 annual turnover in the Republic and its exports from the Republic during the jirm k preceding financial year. 50 (3) When determining an appropriate fine, the Competition Tribunal must consider the following factors:

54

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GOVERNMENT GAZETTE. 300 CTOBER 1998 CO.MPETITION ACT. 1998

Act No, 89, 1998

(a) thenature. duration, gravity andextent of the contravention: (b) any loss or damage suffered as a result of the contravention; (c) the behaviour of the respondent: (d) the market circumstances in which the contravention took place; (e) the level of profit derived from the contravention: (f) the degree to which the re.spondenl has co-operated with the Competition Commission and the Tribunal; and (g) whether the respondent has previously been found in contravention of tilis Act. (4) A fine payable in terms of this section must be paid into the National Revenue Fund referred to in section 213 of the Constitution. Divestiture

5

10

62. ( 1 ) If a merger is implemented in contravention of Chapter 3. the Competition Tribunal may— (a) order a party to the merger to sell any shares. interest or other assets it has 15 acquired pursuant to the merger; or (b) declare void any provision of an agreemenr to which the merger was subject. (2) The Competition Tribunal, in addition to or in lieu of making an order under section 60, may make an order directing any firm, or any other person to sell any shares, 20 interest or assets of the jirm if— (a) it has contravened section 8, and (b) the prohibited practice— (i) cannot adequately be remedied in terms of another provision of this Act; (ii) ~substantially a repeat by that firm of conduct previously found by the 25 Tribunal to be a prohibited practice. (3) An order made by the Competition Tribunal in terms of subsection (2) is of no force or effect unless confirmed by the Competition Appeal Court. (4) An order made in terms of subsection(1) or (2) may set a time for compliance, and any other terms that the Competition Tribunal considers appropriate, having regard to 30 the commercial inrerests of the party concerned. Consent orders 63. (1) If a complaint of a prohibited practice has been investigated by the Competition Commission, and the Commission and the respondent agree on the terms of an appropriate order, the Competition Tribunal, without hearing any evidence, may 35 confirm that agreetnent as a consent order in terms of section 60. (2) With the consent of a complainant, a consent order confirmed in terms of subsection (1) may include an award of damages to that complainant. (3) A consent order does not preclude a complainant applying for— 40 (u) a declaration in terms of section 60(1 )(a)(v) or (vi); or (b) an award of civil damages in terms of section 65, unless the consent order includes an award of damages to the complainant. Status and enforcement of orders 64. (1) Any decision, judgment or order of the Competition Commission, Competition Tribunal or Competition Appeal Court may be served, executed and 45 enforced as if it were an order of the High Court. (2) The Competition Commission may institute proceedings in the High Court on its own behalf for recovery of an administrative penalty imposed by the Competition Tribunal. (3) A proceeding under subsection (2) may not be initiated more than three years after 50 the imposition of the administrative penalty. Civil actions and jurisdiction 65. (1) Nothing in this Acf renders void a provision of an agreement that. in terms of this Acf, is prohibited or may be declared void, unless the Competition Tribunal or 55 Competition Appeal Court declares that provision to be void.

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GOVERNMENT GAZETTE. 30 OCTOBER 1998

Act No. 89, 1998

ACT. 1998

(2) If, in any action in a civil courz, a party raises an issue concerning conduct that is prohibited in terms of this Act, that court must not consider that issue on its merits, and— (u) if the issue raised is one in respect of which the Competition Tribunal or Competition Appeal Court has made an order, the court must apply the determination of the Tribunal or the Competition Appeal Court to the issue; or (b) otherwise, the court must refer that issue to the Tribunal to be considered on its merits, if the court is satisfied that— (i) the issue has not been raised in a frivolous or vexatious manner; and (ii) the resolution of that issue is required to determine the final outcome of the action. (3) The Competition Tribunal and the Competition Appeal Court share exclusive jurisdiction in respect of the following matters: (a) Interpretation and application of the provisions of Chapters 2, 3, and 6, other than this section: and (b) the functions referred to in sections 21(l). 27(1) and 37(1). (4) The Competition Appeal Court has final jurisdiction in respect of any matter referred to in subsection (3) that may be appealed to it or reviewed by it. (5) For greater certainty, the Competition Tribunal and the Competition Appeal Court have no jurisdiction over the assessment of the amount, and awarding. of damages arising out of a prohibited practice. (6) A person who has suffered loss or damage as a result of a prohibited practice— (a) may not commence an action in a citil court for the assessment of the amount or awarding of damages if that person has been awarded damages in a consent order confirmed in terms of section 63(1); or (b) if entitIed to commence an action referred to in paragraph (a), when instituting proceedings, must file with the Registrar or Clerk of the Court a notice from the Chairperson of the Competition Tribunal, or from the Judge President of the Competition Appeal Court, in the prescribed forrn— (i) certifying that the conduct constituting the basis for the action has been found to be a prohibited practice in terms of this Act; (ii) stating the date of the Tribunal or Competition Appeal Court finding; and (iii) setting out the section of ~his Act in terms of which the Tribunal or the Competition Appeal Court made its finding. (7) A certificate referred to in subsection (6)(b) is conclusive proof of its contents, and is binding on a civil court. (8) An appeal or application for review against an order made by the Competition Tribunal in terms of section 60 suspends any right to commence an action in a civil court with respect to the same matter. (9) A person’s right to damages arising out of a prohibited practice comes into existence— (a) on the date that the Competition Tribunal made a determination in respect of a matter that affects that person; or (b) in the case of an appeal, on the date that the appeal process in respect of that matter is concluded. ( 10) For the purposes of section 2A(2)(a) of the Prescribed Rate of Interest Act, 1975 (Act No. 55 of 1975), interest on a debt in relation to a claim for damages in terms of this Act will commence on the date of issue of the certificate referred to in subsection (6). Variation of order

5

10

15

20

25

30

35

40

45

66, (1) The Competition Tribunal, or the Competition Appeal Court, acting of its own accord or on application of a person affected by a decision or order, may vary or rescind 50 its decision or order— (a) erroneously sought or erroneously granted in the absence of any party affected by it;

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Act No. 89, 1998

(b) in which there is ambiguity. or an obvious error or omission. but only to the extent of correcting that ambiguity. error or omission: or (c) made or granted as a result of a mistake common to all of the parties to the proceeding. Limitations of bringing action 67. ( 1 ) A complaint in respect of a~?rc~llibited~~r~~(ti[e may not be initiated more than three years after the practice has ceased, (2) A complaint may not be initiated against any,firm that is. or has been. a wsp[)17dcJ/1[ in proceedings under another section of rhi.s Act relating substantially to the same conduct. Standard of proof 68. In any proceedings in terms of Chapter 3 or this Chapter. the standard of proof is on a balance of probabilities. CHAPTER 7 OFFENCES Breach of confidence 69. ( I ) It is an offence to disclose any confidential inf(~rmution concerning the affairs of any person orjrm obtained— (a) in carrying out any function in terms of this Ac[; or (b) as a result of initiating a complaint or participating in any proceedings in terms 20 of this Act. (2) Subsection (1) does not apply to information disclosed— (a) for the purpose of the proper administration or enforcement of fhis Act; (h) for the purpose of the administration of justice: or (c) at the request of an inspector, Commissioner, Deputy Commissioner or 25 Competition Tribunal member entitled to receive the information. Hindering administration of Act 70. It is an offence to hinder, oppose, obstruct or unduly influence any person who is exercising a power or performing a duty delegated, conferred or imposed on that person 30 by this Act. Failure to attend when summoned 71. (1) A person commits an offence who, having been directed or summoned to attend a hearing— (a) fails without sufficient cause to appear at the time and place specified or to 35 remain in attendance until excused; or (b) attends as required. but— (i) refuses to be sworn in or to make an atlirmation: or (ii) fails to produce a book, document or other item as ordered, if it is in the possession of, or under the control of, that person. Failure to answer fully or truthfully Is 5

10

40

72. A person commits an offence who, having been sworn in or having made an affirrnation— (a) subject to section 56. fails to answer any question fully and to the best of that person’s ability: or 45 (b) gives false evidence, knowing or believing it to be false.

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Act No. 89, 1998 Failure to comply with Act

73. ( 1 ) A person commits an offence who contravenes or fails to comply with an order of the Competition Tribunal or the Competition Appeal Court. (2) A ~erson commits an offence who(a) does anything calculated to improperly influence the Competition Tribunal or 5 Competition Commission concerning any matter connected with an investigation; (b) anticipates any findings of the Tribunal or Commission concerning an investigation in a way that is calculated to influence the proceedings or 10 findings; (c) does anything in connection with an investigation that would have been contempt of court if the proceedings had occurred in a court of law; (d) knowingly provides false information to the Commission; (e) defames the Tribunal or the Competition Appeal Court, or a member of either 15 of them, in their respective official capacities; wilfully interrupts the proceedings or misbehaves in the place where a hearing (f) is being conducted; (g) acts contrary to a warrant to enter and search; (h) without authority, but claiming to have authority in terms of section 46 or 20 47— (i) enters or searches premises; or (ii) attaches or removes an article or document. Penalties 74. (1) Any person convicted of an offence in terms of rhis Act, k ljable— (a) in ~h> case of a contravention of section 73(1), to a fine not exceeding 25 R500 000-00 or to imprisonment for a period not exceeding 10 years, or to both a fine and imprisonment; or (b) in any other case, to a fine not exceeding R2 000-00 or to imprisonment for a period not exceeding six months, or to both a fine and imprisonment. Magistrate’s Court jurisdiction to impose penalties 75. Despite anything to the contrary contained in any other law, a Magistrate’s Court has jurisdiction to impose any penalty provided for in this Act. Serving documents 76. Unless otherwise provided in this Act, a notice, order or other document that, in terms of this Act, must be served on or given to a person, will have been properly served 35 or given when it has been— (a) delivered to that person; (b) sent by registered post to that person’s last known address; or (c) published in the Gazette. Proof of facts 40 30

77. (1) In any criminal proceedings in terms of this Acr— (a) if it is alleged that a person at afirm is or was an employee, that person must be presumed to be an employee at that jirm, unless the contrary is proved; (b) if it is proved that a false statement, entry or record or false information appears in or on a book, document, plan, drawing or computer storage 45 medium, the person who kept that item must be presumed to have made the statement, entry, record or information, unless the contrary is proved; and (c) an order certified by the Chairperson of the Competition Tribunal or the Judge President of the Competition Appeal Court, is conclusive proof of the contents

Act No. W, 1998

COMPETITION ACT. 1998

of the order of the Competition Tribunal or the Competition Appeal Court, as the case may be. (2) A statement, entry or record or information, in or on any book, document, plan, drawing or computer storage medium is admissible in evidence as an admission of the facts in or on it by the person who appears to have made, entered, recorded or stored it 5 unless it is proved that that person did not make, enter. record or store it. CHAPTER 8 GENERAL PROVISIONS Regulations 78. The kfinisre~ by notice in the Ga:erte, may make regulations that are required to 10 give effect to the purposes of rhis Act. Guidelines 79. (1) The Competition Commission may prepare guidelines to indicate the Commission’s policy approach to any matter within its jurisdiction in terms of this Act. (2) A guideline prepared in terms of subsection ( l)— (a) must be published in the Ga:erte; but (b) is not binding on the Competition Commission, the Competition Tribunal or the Competition Appeal Court in the exercise of their respective discretion, or their interpretation of rhis Act. Official seal 80. The President, by proclamation in the Guze[te, may prescribe an official seal for each of the Competition Commission, Competition Tribunal and the Competition Appeal Court. Act binds State 81. This Act binds the State. Information exchange with foreign agencies 82. The President may assign to the Competition Commission any duty of the Republic, in terms of an international agreement relating to the purpose of fhis Act, to exchange information with a similar foreign agency. Transitional arrangements and repeal of laws 83. (1) Subject to Schedule 3, the laws specified in Schedule 2, and all proclamations, regulations or notices promulgated or published in terms of those laws, are repealed. (2) The repeal of those laws specified in Schedule 2 does not affect any transitional arrangements made in Schedule 3. Short TMe and commencement of Act 35 30 25

15

20

84. (1) This Act is called the Competition Act and comes into operation on a date fixed by the President by proclamation in the Gazefte. (2) The president may set different dates for different provisions of this Act to come into operation. (3) Unless the context otherwise indicates, a reference in a section of [his Act to a time 40 when rhis Acr comes into operation must be construed as a reference to the time when that section comes into operation.

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GOVERNMENT GAZETTE. 30 OCTOBER 1998 COMPETITION ACT, 1998

Act No. 89, 1998

SCHEDULE 1
EXEMPTION OF PROFESSIONAL RULES IN TERMS OF SECTION PART A 1. A professional associutio}l may apply in the prescribed manner to the Competition Commission to have all or part of its rules exempted from the provisions of Part A of Chapter 2 of this Act, provided— (a) the rules do not contain any restriction that has the etiect of substantially preventing or lessening competition in a market: or (b) if the rules do contain a restriction contemplated in paragraph (u), that restriction, having regard to internationally applied norms, is reasonably required to maintain— (i) professional standards; or (ii) the ordinary function of the profession. 2. Upon receiving an application in terms of item 1, the Competition Commission may exempt the ruies concerned after it has — (a) given notice of the application in the Gazette: (b) allowed interested parties 30 days from the date of that notice to make representations concerning the application; and (c) consulted the responsible Minister, or member of the Executive Council. 3. The Competition Commission, in the prescribed manner, may revoke an exemption granted under item 2 on good cause shown, at any time after it has — (a) given notice in the Gazette of its intention to revoke the exemption; (b) allowed interested parties 30 days from the date of that notice to make representations concerning the exemption: and (c) consulted the responsible Minister, or member of the Executive Council. 4. A professional rule is exempt, or its exemption revoked, only as of the date that notice of the exemption or revocation, as the case may be, is published in the Gazette. 5. The Competition Commission must maintain for public inspection a record of all professional rules that have received exemption, or for which exemption has been revoked. 6. In this Schedule — ‘professional association’ means an association referred to in Part B of this Schedule; ‘professional rules’ means rules regulating a professional association that are binding on its members; ‘rules’ includes regulations, codes of practice and statements of principle; PART B For the purpose of this Act, a professional association is— (a) for each of the following professions, a governing body of that profession registered in terms of an Act mentioned below the name of that profession; or (b) any other association, if the Competition Commission is satisfied that it represents the interests of members of a profession referred to in paragraph (a): Accountants and Auditors Public Accountants and Auditors Act, 1991 (Act No. 80 of 1991). Architects Architects Act, 1970 (Act No. 35 of 1970). Engineering Engineering Profession of South Africa Act, 1990 (Act No. 114 of 1990)
Z(C)

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GOVERNME!WG AZETTE.300CTOBER COMPETITION ACT. 1998

1998

Act No. W, 1998

Estate Agents Estate Agents Act. 1976 (Act No. 1 I 2 of 1976) Attorneys and Advocates Attorneys Act. 1979 (Act No. 53 of 1979) Admission of Advocates Act. 1964 (Act No. 74 of 1964) Natural sciences Natural Scientific Professions Act, 1993 (Act No. 106 of’ 1993) Quantity Surveyors Quantity Surveyors Act. 1970 (Act No. 36 of 1970) Surveyors Professional and Technical Sur\ eyors Act. 198-! (Act No. -$0 Of 1984) Town and Regional Planners Town and Regional Planners Act. 1984 (Act No. 19 of 1984) Valuers Valuers Act, 1982 (Act No. 23 of 1982) Medical Medical. Dental and Supplementary Health Service Professions Act. 1974 (Act No. 56 of 1974) Nursing Act. 1978 (Act No, 50 of 1978) Dental Technicians Act, 1979 (Act No. 19 of 1979) Pharmacy Act, 1974 (Act No. 53 of 1974) Veterinary and Para-veterinary Professions Act, 1982 (Act No. 19 of 1982) Chiropractors Homeopaths and Allied Health Service Professions Act, 1982 (Act No. 63 of 1982) Miscellaneous Any other profe.ssimal a.s.sociutim to whom the provisions of this Schedule have been declared applicable by the Minister by notice in the Gazette.

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19412

GOVERNMENT GAZETTE, 30 OCTOBER 1998 COMPETITION ACT. 1998

Act No. 89, 1998

SCHEDULE 2 REPEAL OF LAWS (SECTION 83)
No and Year of Law Act No. 96 of 1979 Act No. 58 of 1980 Act No. 62 of 1983 Act No. 12 of 1985 Act No. 5 of 1986 Act No. 96 of 1987 Act
No.

Short Title
Maintenance and Promotion of

Extent of Repeal The whole The whole The whole The whole The whole The whole The whole

Competition Act. 1979 Mamtenwrce and Promotion of Competition Amendment Act, 1980 Maintenance and Promotion of Competition Amendment Act. 1983 Maintenance and Promotion of Competition Amendmen( Act. 1985 Maintenance and Promotion of Competition Amendment Act. 1986 Maintenance and Promotion of Competition Amendment Act. 1987 Maintenance and Promotion of Competition Amendment Act. 1990

88 of 1990

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GOVERNMENT G.AZEITE. 30 OCTOBER 1998 COMPETITION ACT. 1998

Act No. 89, 1998

SCHEDULE 3 Transitional Arrangements 1. A ruling issued in terms of section 6(1 )(a) of the Maintenance and Promotion of Competition Act. 1979 (Act No. 86 of 1979), or notice issued in terms of section 14( 1 )(c) of that Act. in relation to an “acquisition” as defined in that Ac[, must be regarded for purposes of this Act to be a conditional approval of a merger as if it had been granted after (his Act came into operation by the Competition Commission in terms of section 14(1)(b), or by the Competition Tribunal in terms of section 16(2)(b). 2. An arrangement entered into in terms of section 11(1) of the Maintenance and Promotion of Competition Act, 1979 (Act No. 86 of 1979), must be regarded as having been confirmed as a consent order in terms of section 63 of fhis ACY and is valid for a period of 12 months from the date on which this Act comes into operation. 3. An exemption granted in terms of Section 14(5) of the Maintenance and Promotion of Competition Act, 1979 (Act No. 86 of 1979). must be regarded as having been granted in terms of section 10 of [his Act and is valid for a period of 12 months from the date on which /his Act comes into operation. 4. Any reference in any other statute to(a) the Maintenance and Promotion of Competition Act, 1979 (Act No. 86 of 1979), must be regarded as a reference to this Act; (b) a “restrictive practice” or ‘-monopoly situation” as defined in terms of section 1 of the Maintenance and Promotion of Competition Act, 1979 (Act No. 86 of 1979), must be regarded as a reference to a “prohibited practice”’ in terms of this Act; (c) an “acquisition” as defined in terms of section 1 of the Maintenance and Promotion of Competition Act, 1979 (Act No. 86 of 1979), must be regarded as a reference to a “merger” in terms of thi~ Act; (d) the “Competition Board” as established in terms of section 3 of the Maintenance and Promotion of Competition Act, 1979 (Act No. 86 of 1979), must be regarded as a reference to the Competition Commission. 5. When this Act comes into operation an officer or employee appointed in terms of the Public Service Act, 1994, to serve the Competition Board established by the Maintenance and Promotion of Competition Act, 1979 (Act No.86 of 1979), continues to be an officer or employee under the Public Service Act. subject to the direction of the Department of Trade and Industry. 6. If an officer or an employee referred to in item 5 is appointed as an officer or employee of the Competition Commission, the accumulated value of that person’s contributions to any pension fund, together with the accumulated value of the contributions made to that fund by that person’s employer, may be transferred to a pension fund established for the benefit of the staff of the Commission.