LML4802 Assignment
1 (COMPLETE
ANSWERS) Semester
2 2023
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QUESTION 1
1.1 Save Buy is a multinational retail corporation from China, with various stores
globally. Save Buy decides to buy 100% interests in Masiv Stores, a giant retail
store in South Africa, to enter the South African market. In as much as this
transaction will help Save Buy enter the South African market, various
stakeholders in South Africa are concerned that the transaction will harm public
interests. The concerns that stakeholders raise are; amongst others; that Save Buy
has a history of not respecting workers’ rights; the transaction will negatively affect
the South African manufacturing sector, Save Buy will not source its products from
South Africa and that jobs will be lost.
1.1.1 You are the merger and acquisitions manager at the Competition Commission.
Write a report in which you discuss the procedure that must be followed to assess
this merger and how the evaluation of the merger should be conducted. (10)
1.1.2 Suppose that during the investigation, it is found that the merger will result in loss
of employment for about 1200 staff out of the 16500 staff employed by Masiv
Stores. Further, it is also established that once the merger is approved, Save Buy
will use its global supply chain, which will affect South African suppliers, and this
will also lead to job losses in other parts of the supply value chain. As a presiding
officer of the Competition Tribunal, what would be the outcome of the merger? (10)
1.1.3 Discuss whether the ground of the public interest should form part of the factors to
consider when evaluating whether to approve a merger or not. Discuss your
answer with reference to the relevant authority. (10)
1.2 Brown Bakers is the supplier of baked products, including bread and has a market
share of 40%. Brown Bakers has been struggling to penetrate the market in Kwa-
Zulu Natal and Western Cape provinces. As a result, Brown Bakers agreed with
Soul Food, another supplier of bakery products, that since they are not making
huge returns in those two provinces, it would be appropriate for them to share the
market. In their discussions, they agree that consumers will benefit in that there
won’t be competition between suppliers, thereby reducing production costs. In
addition, the reduced costs of production will lead to lower prices for the benefit of
consumers. Retailers in the two provinces are disgruntled with the arrangement as
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CONFIDENTIAL
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LML4802
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it results in these retailers taking increased prices from the suppliers and thereby
reducing retailers profit margins.
A complaint is lodged with the Competition Commission regarding Brown Bakers
and Soul Food’s conduct. You are the principal investigator of the complaint. Write
a report wherein you discuss the provisions of the Competition Act 89 of 1998 that
Brown Bakers and Soul Food may have contravened. Further, discuss the
sanctions that the Tribunal may impose in this matter. (10)
(40)
QUESTION 2
2.1 The classic description of passing off, in Capital Estates v Holiday Inns Inc 1977
(2) SA 916 (A) reads as follows:
“The wrong known as passing off consists in a representation by one person that
his business (or merchandise, as the case may be) is that of another, or that it is
associated with that of another, and, in order to determine whether a
representation amounts to a passing-off, one enquires whether there is a
reasonable likelihood that members of the public may be confused into believing
that the business of the one is, or is connected with, that of another.”
In Beiersdorf AG v Koni Multinational Brands (Pty) Limited (85102/2017) [2019]
ZAGPJHC 10 (12 February 2019) (para 30), Fisher J held that:
To my mind, the strength of the Nivea brand operates against the respondent in
this case. The hallmarks in get-up and logo have the potential to retain reputation
through changes and rebrands. Indeed, it is not unusual for historical brandings to
be revisited in the market in order to invoke nostalgia and a sense of staying
power… The memory in the marketplace of past get-ups can, in some
circumstances, create associations which endure and which can outlive changes
in get-up and rebranding.
Critically discuss the above quotation in the light of the definition contained in the
Capital Estates decision, and consider whether discontinued or past get-ups are
worthy of protection against passing off. (10)
2.2 Hotbake Company, a large bread producer, hears that Cupcake Company, another
bread producer, has launched a new type of seed bread under the name LIGHT
DELIGHT. Cupcake Company states that this loaf is made to the precise
specifications of the leading dietary group and contains 50% fewer calories than
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