De­wald van Rens­burg

CityPress - - Business And Tenders -


3A new amend­ment to the Com­pe­ti­tion Act men­tioned by Zuma will be fi­nalised for Cabi­net’s con­sid­er­a­tion by Oc­to­ber this year, said Min­is­ter of Eco­nomic Devel­op­ment Ebrahim Pa­tel.

The high con­cen­tra­tion of many mar­kets in South Africa – such as re­tail and bank­ing – was sin­gled out by the World Bank for re­tard­ing eco­nomic ex­pan­sion last year, noted Pa­tel.

“The work of the Com­pe­ti­tion Com­mis­sion across a wide range of sec­tors has con­vinced it, the reg­u­la­tor and the pol­i­cy­maker that the law is in­ad­e­quate to ad­dress in­stances of mar­ket dom­i­nance by a small num­ber of firms,” said Pa­tel, hint­ing that the amend­ment might in­tro­duce a po­ten­tially rad­i­cal change to the way in which harm caused by un­com­pet­i­tive be­hav­iour is judged in com­pe­ti­tion law.

Local ex­perts have long com­plained that South Africa’s Com­pe­ti­tion Act makes it al­most im­pos­si­ble for any­one be­sides large com­pa­nies to make a case against dom­i­nant com­pa­nies.

This is be­cause the act re­quires a demon­stra­tion of “anti-com­pet­i­tive ef­fects”, which is im­pos­si­ble to prove in cases where a small busi­ness has no chance of en­ter­ing a sec­tor.

Ac­cord­ing to Pa­tel, the act does not “ad­e­quately ad­dress pub­lic con­cerns about mar­ket struc­ture, par­tic­u­larly high lev­els of con­cen­tra­tion in the econ­omy”.

An­other con­cern which the amend­ment may ad­dress is the law’s in­ef­fi­cacy when it comes to tack­ling abuse of dom­i­nance through ex­ces­sive pric­ing and other prac­tices. There have been more than 30 cases of abuse of dom­i­nance since the Com­pe­ti­tion Act came into be­ing in 1999.

Last year, a con­tro­ver­sial amend­ment to the act crim­i­nalised car­tel be­hav­iour, making in­di­vid­u­als and not just the com­pa­nies they run li­able. This has paved the way for fines and even jail time for car­tel mem­bers.


4Zuma said “di­rect state in­volve­ment in min­ing” was still on the cards. “The Min­ing Com­pany of SA Bill will be pre­sented to Cabi­net and Par­lia­ment dur­ing the year,” he added.

Martin Mad­lala, spokesper­son for the depart­ment of min­eral re­sources, was un­able to com­ment on the con­tents of new bill be­ing mooted.

Cur­rently, gov­ern­ment’s main min­ing ve­hi­cle is the African Ex­plo­ration Min­ing and Fi­nance Cor­po­ra­tion, a sub­sidiary of the Cen­tral En­ergy Fund.

How­ever, there are plans to move the com­pany to the depart­ment of min­eral re­sources.

In Jan­uary 2016, Min­is­ter of Min­eral Re­sources Mosebenzi Zwane is­sued the African Ex­plo­ration Min­ing and Fi­nance Cor­po­ra­tion Bill, which pro­vided for the es­tab­lish­ment of the min­ing com­pany as a new, state-owned, stand-alone com­pany.

The bill pro­posed that the state min­ing com­pany ac­quire and de­velop min­ing in­ter­ests.

At the time, the DA re­ferred to the bill as “an­other po­ten­tially dam­ag­ing piece of leg­is­la­tion”.

“If passed, it will fur­ther di­min­ish the rep­u­ta­tion of South Africa as a place to put money into min­ing. That means less in­vest­ment and fewer jobs,” the DA said.

“The bill is re­plete with prob­lems. It will see the com­pany be­com­ing the per­sonal king­dom of Min­is­ter Zwane, with the min­is­ter hav­ing a say in al­most ev­ery ma­jor de­ci­sion in the com­pany and al­most com­plete con­trol of its board,” the DA added.

“Fur­ther, the min­is­ter will now, more than ever, be play­ing both ref­eree and player in the min­ing in­dus­try,” con­cluded the party.

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