Exam (elaborations)
LML4802 EXAM PORTFOLIO 2024 TO 2025
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- LML4802 (LML4802)
- Institution
- University Of South Africa
LML4802 EXAM PORTFOLIO 2024 TO 2025
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LML4802LAW OF COMPETITION AND
TRADEMARKS
QUESTIONS, NOTES AND ANSWERS
FOR FURTHER CLARIFICATION PLEASE
EMAIL ME AT
KEVINLUGWIRI98@GMAIL.COM
, lOMoARcPSD|48946436
MODULE CODE: LML4802
ASSIGNMENT NUMBER: 01
DUE DATE: 31 AUGUST 2022
(a.) The Competition Act 89 of 1998 (<the Act=) provides procedures to be followed
for the various types of mergers in order for said mergers to comply with the
merger control provisions set out in the Act.
In light of the fact that the transaction between the CanePro Company
(<CanePro=) and the Sweetsip Company (<Sweetsip=) qualifies as a large
merger, CanePro and Sweetsip will need to comply with the merger control
provisions of the Act by following the steps set out hereunder.
Prior to the implementation of the merger, CanePro and Sweetsip will need to
comply with the notification procedure for large mergers as set out in section
13 of the Act. Section 13A(1) of the Act provides for compulsory notification of
all large mergers, and therefore, CanePro and Sweetsip will first need to notify
the Competition Commission of the proposed merger. Further to the
aforementioned, a representative trade union which represents the employees
of CanePro and Sweetsip must be notified of the proposed merger by both
CanePro and Sweetsip in order to comply with section 13A(2) of the Act.
Once CanePro and Sweetsip has notified the Competition Commission and the
respective representative trade unions, they are required to await the decision
in respect of the approval of the proposed merger from the Competition
Tribunal. The Competition Commission is required to refer the notification of
the merger to the Competition Tribunal and the Minister and must, within 40
(Forty) business days subsequent thereto, or within the extended period,
provide the Competition Tribunal with a recommendation in respect of whether
the implementation of the merger should either be approved; approved with
conditions; or prohibited. Once the Competition Tribunal has received the
referral from the Competition Commission, the Competition Tribunal will either
, lOMoARcPSD|48946436
approve the merger; approve the merger with conditions; or prohibit the
implementation of the merger. According to section 13A(3), CanePro and
Sweetsip will only be allowed to implement the merger once they have received
the approval from the Competition Tribunal.
(b.) The proposed merger of CanePro and Sweetsip will be evaluated by the
Competition Tribunal on competition and public interest grounds in terms of
section 12A of the Act.
When evaluating the proposed merger and considering whether the proposed
merger should be approved, the Competition Tribunal will apply the initial test,
as set out in section 12A(1) of the Act, of whether or not the proposed merger
is likely to substantially prevent or decrease competition. By doing the
aforementioned, the Competition Tribunal will assess the strength of the
competition in the relevant market and the competitive or cooperative behaviour
of the firms within the market subsequent to the implementation of the merger
while taking into account all the relevant factors in respect of the competition in
the market which are set out in section 12A(2) of the Act and include inter alia
the following: the degree of countervailing power in the market and whether the
merger will result in the removal of an effective competitor.
In the event that the proposed merger is not likely to substantially prevent or
decrease the competition in the market, it could still be rejected if the public
interest grounds are not justified. When tackling the public interest ground, the
effect of the proposed merger must consider the aspects set out in section
12A(3) of the Act.
In the event that the proposed merger is likely to substantially prevent or
decrease the competition in the market, the proposed merger could still be
approved if it could result in technological, efficiency or other pro-competitive
advantages which have the effect of outweighing the anti-competitive effect of
the merger and if it could be justified on public interest grounds.
, lOMoARcPSD|48946436
Law of competition and trademarks notes 2016
The Competition Commission is first and foremost an investigative
body. It has jurisdiction throughout South Africa (s 19). Its primary
functions are to:
investigate and evaluate suspected contraventions of the Act
grant or refuse applications for exemptions
negotiate and conclude consent orders
investigate and evaluate proposed mergers
refer matters to and appear before the Competition Tribunal
review legislation
negotiate agreements with any regulatory authority to coordinateand harmonise
the exercise of jurisdiction over competitionmatters within an industry or sector
deal with any other matter referred to it by the Competition Tribunal(s 21)
The Competition Tribunal is the adjudicative arm of the competition
Authority with jurisdiction throughout South Africa (s 26(1)). The
functions of the Competition Tribunal are to:
adjudicate in relation to contraventions of the Act and imposeappropriate
remedies (Seagram Africa (Pty) Ltd
adjudicate on any other matter that may be considered by it
hear appeals from, or review any decision of the CompetitionCommission
make any order or ruling necessary or incidental to its functions (s27(1))
List five economic and social objectives that underpin the competition
Act 89 0f 1998 (section 2 of competition Act)
the promotion of economic efficiency,
adaptability anddevelopment,
competitive prices and product choices for consumers,
international competitiveness,
market access of small and mediumsizedenterprises,
the diversification of ownership in favour ofmembers of historically disadvantaged
communities,
the creation ofnew employment opportunities and
the advancement of social andeconomic welfare of all South Africans
The following anti-competitive practices are prohibited:
restrictive horizontal practices
restrictive vertical practices
abuse of a dominant position
The prohibitions of both restrictive horizontal and vertical practices are based on
behaviour alone, regardless of the size or structure of the offending firm.
However, the prohibition against abuse of a dominantposition is based on a
combination of the size or structure of theoffending firm, as well as behaviour.
By RhulaniUbisi milkypat@gmail.com Page 1
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