Competition Commission Research Articles

Exploring the sensitive interplay between labour law and competition jurisprudence: Coca-Cola Beverages Africa (PTY) Ltd v Competition Commission of South Africa & Another [2024] ZACC 3

On 17 April 2024, the Constitutional Court of South Africa handed down a landmark judgment in Coca-Cola Beverages Africa (Pty) Ltd v Competition Commission & Food and Allied Workers Union [2024] ZACC 3. The case highlighted the intersection of labour and competition, two areas of the law that are cardinal to the protection, promotion, and realisation of socio-economic rights. Labour law is paramount to the realisation of socio-economic rights because it regulates, among other things, the right to fair wages, employment equity, safe working conditions, social security benefits, and job security, which all ensure that individuals can earn a living to support their families and afford access to goods and services essential for their socio-economic well-being. Competition law, on the other hand, advances the realisation of socio-economic rights through the promotion of fair markets and the combating of anti-competitive conduct, ensuring that consumers have access to the best quality goods and services at fair prices, which is essential for consumers' economic well-being.

A Comparative Analysis of Abuse of Dominant Position between India and UK.

By making a distinction between companies that gain dominance via fair competition and those that abuse it to suppress market rivalry and take advantage of customers, India's Competition Act, 2002 seeks to prohibit the abuse of dominant market positions. Unfair pricing and discriminatory conditions that harm competitors and restrict consumer options are examples of behaviors that are addressed by the Act. In order to uphold the Act and encourage competitive market conditions that benefit customers and the expansion of the sector as a whole, the Competition Commission of India (CCI) was founded. But it might be difficult to tell the difference between abuse and legitimate authority. Key terminology like "enterprise" and "group" are defined throughout the Act to make its scope more clear. An "enterprise" is any organization that produces, distributes, or controls goods and services, whereas a "group" is made up of several businesses that have substantial voting rights or managerial authority over one another. Abuse of a dominating market position is prohibited by Section 4 of the Act, which lists actions such as restricting market access, unfair pricing, and barring rivals. Two primary viewpoints are used to assess dominance: structural (market share) and behavioral (capacity to function independently of rivals). When evaluating market power, the behavioral definition is used since it is more thorough. Prior to the Act, market share was the main determinant of dominance; however, the SVS Raghavan Committee placed a strong emphasis on analyzing a company's effect on competition. Comparably, in accordance with EU legislation, Section 18 of the UK's Competition Act 1998 forbids the misuse of market dominance. It draws attention to actions such as discriminatory terminology, restricting policies, and unfair pricing. By addressing matters such as merger control and market investigations, the Enterprise Act of 2002 promotes competition even more. In the UK, competition laws are enforced by the Competition and Markets Authority (CMA). Although the competition rules of the UK and India are similar, the UK Act more closely resembles EU law, particularly with regard to market dominance, albeit with minor jurisdictional distinctions.

The relationship between business competition and welfare in Indonesia.

This research freshly investigates the effect of business competition on national welfare in Indonesia. This research uses business competition index data obtained from the Indonesia Competition Commission (KPPU) and welfare indicators data collected from the Indonesian Bureau of Central Statistics (BPS) at the economic sectoral and provincial levels for the period 2018-2020. The relationship between business competition and welfare is estimated using pooled regression model combining year, economic sector, and province. This research also uses business competition index applying both same weights for all dimensions of competition and the weights derived from principal component analysis. This research finds that business competition has a positive effect on welfare as represented by gross regional domestic product, regional productivity, productivity growth, wages, and human development index. Furthermore, the regions with high scores on the competition index mostly come from Java Island. Therefore, Indonesian government must encourage the mainstreaming of business competition in all provinces in Indonesia.

The Competition Act of 2012 and Bangladesh Competition Commission: Challenges and Possible Solutions

The Competition Act of 2012 and Bangladesh Competition Commission: Challenges and Possible Solutions

Selections from the 2024 Case Writing Competition: Business Communication Case and Student Example

As part of the Association for Business Communication Student Case Competition, this article features a case study written by ABC member Rachel Dolechek. The case was blind reviewed and selected by the ABC Student Competition Committee. ABC membership utilized the case in their classrooms throughout 2024 and submitted top student examples for the 2024 Case Writing Competition. A submission from Addie Hileman, sponsored by Kelley O’Brien, was selected as the top student case writer after evaluation by the ABC Student Competition Committee and a marketing business professional. The student’s message serves as a teaching example within this article.

A Critical Evaluation of India’s Proposed Digital Competition Act

The emergence of digital marketplaces has resulted in considerable changes in the business sector, with new competitors joining the market, offering novel products and services and challenging the supremacy of traditional players. Although digital marketplaces provide a plethora of pro-competitive benefits, they are prone to anti-competitive practices due to characteristics such as significant network effects, high innovation rates and rapidly changing technologies. This has raised concerns about the potential anti-competitive practices and market abuses that could arise in the digital economy, sparking the question of whether the current regulatory framework of the Competition Act 2002 (2002 Act) is effectively addressing the challenges. It is being seen that enterprises (either global or Indian) have been trying to subsidise users to attract them to the network effects by resorting to a series of big losses, which in other words has raised alarms regarding predatory pricing in the market. People may enjoy discounts given by enterprises. While the immediate benefits of these enterprises may appear advantageous, they will adversely affect customers in the long term, especially as customers become increasingly dependent on their services. In this study, the author illustrates how the current legislation can deal with the unique characteristics or requirements of digital marketplaces. The research further puts forth the negative implications of the ex-ante mechanism with case laws and comparative analysis with international jurisdictions. The findings of the study suggest that India should not blindly replicate what other jurisdictions, especially the European Union are pursuing i.e., taking steps towards enacting a separate digital competition law. The implications of this work would be a deliberate analysis of the provisions of the 2002 Act in line with the working of the Competition Commission of India (CCI) to suggest the adequacy of present law in dealing with competition issues in digital marketplaces.

Anticompetitive Consequences of Exclusivity Clauses Contained in Shopping Centres’ Lease Agreements

This article discusses the impact of commercial lease agreements concluded in shopping centres that contain exclusivity clauses on competition. It assesses whether these clauses restrict equitable retailer participation in shopping centres, thereby denying consumers competitive prices and product choices. It also demonstrates that the South African Competition Commission has classified lease agreements' exclusivity clauses as problematic and persuaded the major grocery retailers to phase them out. While this is a positive step, this article argues that there should be some regulatory framework that can ensure that none of these retailers continue to restrict competition in shopping centres by enforcing exclusivity clauses. The Commission should play a prominent role in ensuring that the terms of the consent orders signed by some of these retailers are respected to ensure that competition is promoted in shopping centres in South Africa.

The South African Competition Commission COVID-19 easing of competition rules for private healthcare to facilitate public-private interaction - a media content analysis

BackgroundFuture emergencies from climate degradation or diseases are likely, prompting ongoing investment in emergency readiness and learning from country responses. South Africa’s healthcare system, divided into public and private sectors, required a coordinated, intersectoral response to the COVID-19 pandemic. A coordinated action that the South African government took was adapting competition regulations. The South African Department of Trade, Industry and Competition on 19 March 2020, published a block exemption (easing of competition rules) for healthcare to promote standardization of practices across the health sector and facilitate agreements between the National Department of Health and the private sector to ensure adequate service delivery to all South Africans.MethodsWe assessed how much coverage the block exemption for healthcare received in the media and if the scope included details of what the exemption meant, how stakeholders and the public could use it, and the resulting public sentiment. We conducted a media content analysis to select, screen and assess the media material. Online and social-media articles in the public domain from 19 March 2020 to 19 March 2021, in English were considered.ResultsWe analysed 22 online media articles that matched our inclusion criteria. Twenty of these reflected a positive sentiment, and two were negative. Media reported on the COVID-19 block exemption in healthcare only in the first three months of our study period. The articles primarily communicated what the block exemption meant, focusing on allowing collaboration, the purpose of the exemption, the activities granted under the exemption and the actors to whom it applied. It’s estimated that these media articles could have been read by up to 432,003 people out of a total population of just under 43 million people over the age of 15 years.ConclusionIn times of crisis, the media has a significant responsibility to provide accurate information to the public. However, the accuracy and reliability of such information depends on the quality of official sources on which the media relies. Our research shows that very few media reports were available about the block exemption for healthcare. While the government implemented the exemption, it did not communicate its purpose directly to the public. Our research highlights the need for better communication between policymakers and the media.

MERGER CONTROL REGIME IN MALAYSIA: PAST, PRESENT AND WAY FORWARD

Merger control is one of the main pillars of a competition law regime. Without a merger control provision, a competition authority is unable to prevent a problematic merger that lessens competition in the market from being consummated. Malaysia, having its national cross-sector competition law regime in place only since 2010, has, apart from sectoral regulations, no merger control regime in place. The country has adopted a sectoral approach to merger control, empowering certain regulators to oversee merger activities in a specific market or industry. Since 2020, the Malaysia Competition Commission (MyCC) has been working on the proposed amendments to the Competition Act 2010 (CA 2010), aiming to incorporate a merger control regime as one of its main agendas. The primary objective of this paper is to explore the development of the merger control regime in Malaysia. The main contribution of this paper is the analysis of the merger control regime in the proposed amendment of the CA 2010 and an understanding of the issues and challenges involved in the enforcement of merger control provisions. The research is doctrinal, based on descriptive and analytical methods, and relies on both primary and secondary data. The research is doctrinal, utilising descriptive and analytical methods, and relies on both primary and secondary data. It also incorporates a comparative element by examining experiences from more developed jurisdictions, such as the European Union and the United States, which have extensive experience in enforcing merger control. Conclusions can be drawn from debates in these jurisdictions regarding potential adjustments to their respective merger control regimes.

Realisation of Music Teacher's Complaint Act with Gender Perspective in Solo Song WhatsApp Group

This qualitative study applies a pragmatic approach that investigates the complaining speech act (CSA) used by male and female music teachers based on the substansion of the Solo Song Competition in WhatsApp Group. Data were collected from the utterances of 13 participants using note-taking. The results indicated several findings. First, male music teachers have the highest preference for using the expression of disapproval with annoyance in the substance of after TM. In contrast, female music teachers have the highest preference for using the hint and the blame with explicit blame for person in the substance of before TM. The reason is not only about a high pressure from the school, parents, and students regarding the competitions, but also about dissatisfaction, dislike, and worry with a situation that is perceived as unfair, unprofessional, or harmful. Third, based on the comparison of the result of this study and previous researches reveals that gender influenced the choice of CSA usage. The results revealed that most of the complaints were related to issues regarding the competition regulations after TM. The competition regulations that were highly complained by both male and female music teachers were the inappropriate music instruments for men and women. The results also indicated that most of the complaints were addressed to the coordinator of the competition committee. The complaints submitted were a result of the untrustworthiness of male and female music teachers to the competition committee

Standard Essential Patents and Abuse of Dominance: Implications for India's Telecom Sector

The rapid advancement of technology has positioned Standard Essential Patents (SEPs) as a critical component of innovation in the telecommunications sector, particularly in India. SEPs are patents that cover inventions essential to industry standards, facilitating interoperability and ensuring effective communication between devices. However, the significant market power held by SEP holders raises important concerns regarding the potential abuse of dominance, especially when these entities impose excessive licensing fees or engage in discriminatory practices. This paper examines the intersection of SEPs and competition law in India, focusing on the legal challenges faced by the Competition Commission of India (CCI) in regulating SEP holders under the Competition Act, 2002. By analyzing the regulatory framework and its implications for market dynamics, this study highlights the necessity for a balanced approach that protects both intellectual property rights and competitive practices. The findings suggest that while existing legal mechanisms aim to address abuses of dominance, there is a pressing need for clearer guidelines and stronger enforcement to ensure that SEPs foster innovation without stifling competition in India's rapidly evolving telecom landscape.

Non-compete clauses in employment contracts: The case for regulatory response

Abstract In the employment context, non-competes are contractual terms which provide that once the employment ends the employee cannot work for another employer in the same industry or field (i.e. a competitor), within a specified geographic area, for a specified time. The existing law and practice regarding non-competes in Australia is plagued with confusion and uncertainty. Non-competes also have adverse economic consequences; they are associated with reduced employee mobility and consequent negative impacts on wages and productivity. The use of non-competes by Australian business has increased over the past 5 years and absent a policy response; this trend is likely to continue. Non-competes are no longer limited to highly paid executives but now apply to about one in five Australian workers, across income, age, occupational, and education groups. The distribution and prevalence of non-competes in Australia are broadly consistent with data in other developed economies. A number of jurisdictions within the Organisation for Economics Co-operation and Development have imposed restrictions on the use of non-competes. The US Federal Trade Commission is considering a ban on their use and, in the UK, the government has announced its intention to limit the term of non-competes to 3 months. In Australia, the Competition Minister has recently asked the Australian Competition and Consumer Commission and Treasury for advice on the competitive aspect of non-competes. The Australian Government released an Issues Paper (https://treasury.gov.au/sites/default/files/2024-04/c2024-514668-issues-paper.pdf#page40) – ‘Non-competes and other restraints: understanding the impacts on jobs, business and productivity’ in April 2024. The Issues Paper outlines the existing research and evidence in Australia and overseas on the use and effects of non-competes. A public consultation process will conclude in May 2024 and Treasury will advise the Government on the outcomes of the consultations by the end of 2024. After reviewing the arguments for and against restricting the ‘reach’ of non-competes, I conclude that the weight of the evidence favours a regulatory response to ameliorate the unfairness inherent in the existing law and practice. A number of possible regulatory responses are considered.

Sustainability Goals vs. Competition Law: Global Trends and Challenges

The growing awareness of climate change has highlighted the need for competition law to adapt and promote sustainability. Recently, many competition authorities have been exploring ways to integrate environmental considerations into their frameworks. The significance of aligning sustainability with competition regulations has become increasingly evident. Achieving sustainability goals requires cooperation from both companies and regulators to establish and implement industry-wide objectives. The United Nations' sustainability goals and nations' commitments to sustainability will shape future development in line with the Paris Agreement. Integrating green antitrust policies with economic progress is now a key topic of global debate among regulators. The Competition Commission of India is at a critical junctureto develop a clear competition policy for sustainability and offer detailed guidance to companies to meet these goals. However, the path to a sustainable antitrust policy is fraught with challenges, including economic development, innovation, jurisdictional issues, and India’s international obligations.

Deal Value Threshold and M&A: A Competition Law Analysis

In 2023, the Indian Parliament introduced amendments to the Competition Act, 2002. The primary focus of these amendments is to provide regulatory certainty, ensure faster market correction, and provide a trust-based business environment in India. These amendments also aim to give the Competition Commission of India (CCI) adequate power to ensure that no anti-competitive practices are undertaken in India. A plethora of amendments have been enacted, and one of the key amendments impacting M&A is the introduction of the Deal Value Threshold (DVT) while retaining the asset and turnover test. The rationale for this amendment is to ensure digital markets are covered within the ambit of DVT and to ensure that no anti-competitive M&A deals are undertaken in the digital market space. The impact of the new additional threshold in India has been analyzed, and the loopholes in the DVT framework have been highlighted. The impact of DVT on M&A deals undertaken in India has been showcased. In addition, solutions have been provided that can be adopted by the CCI in order to plug the loopholes in this new framework to make it comprehensive.

Research on Comprehensive Evaluation Indicators and Methods of World-Class Open-Pit Coal Mines

Since the 20th century, with the rapid development of the global economy, human demand for fossil energy such as coal has been increasing. In the face of fierce competition, the state and various ministries and commissions have put forward the goals and requirements of building a world-class enterprise, and how to become a world-class open-pit coal mine and establish the corresponding evaluation standards has become an urgent scientific problem to be solved. According to the characteristics of open-pit coal mine production and operation, from the perspective of benchmarking world class, the key factors affecting the construction of world-class open-pit coal mines are extracted by using the fuzzy DEMATEL method, and the comprehensive evaluation index system, evaluation standards, and methods of open-pit coal mines are established, which provides benchmarks and guidelines for the construction of world-class open-pit coal mines and improves the construction level of world-class open-pit coal mines.

Expanded powers in a market inquiry: is this power consistent with constitutional and natural justice guarantees?—‘The Case of the COMESA Competition Commission’

Abstract In the past few years, more and more competition authorities have expanded their powers in conducting market inquiries. Some competition laws have given the competition authorities the power to impose remedies after a market inquiry and to impose fines on undertakings that resist providing information during a market inquiry. Some competition authorities are in the process of amending their laws to mirror this development. The COMESA Competition Commission is an exemplary incident of a competition authority that is amending its law to cloth it with expansive powers in the conduct of market inquiries. This article explores whether or not such expanded powers in a market inquiry are overly intrusive and whether they are consistent with the constitutional and natural justice guarantees. An interrogation on whether there are safeguards to ensure that these powers are not unfettered and do not result in abuse of the rights of those that are subject to this power will also be conducted.

A Commentary on the Jurisdictional Challenges in the Rand- Dollar Exchange Manipulation "Cartel": Competition Commission of South Africa v Bank of America Merrill Lynch International Designated Activity Company [2023] ZACT 26 (30 March 2023)

Cartels are the most egregious of competition law transgressions, because they entail a concerted effort on the part of cartel members to deliberately distort the market through price fixing, bid rigging, market allocation and constraining the supply of goods and services. Despite efforts by national competition authorities in various countries to combat cartelism, cartels have proved to have long tentacles, often extending beyond borders and morphing into "cross-border cartels". This contribution discusses one of the major challenges that cross-border cartels poses to competition authorities, that of prosecutorial and penal jurisdiction. The note focusses on the "banking cartel" that has been and still is the subject of contentious litigation. In March 2023 the Competition Tribunal (the Tribunal) handed down judgment in the matter of the Competition Commission of South Africa v Bank of America Merrill Lynch International Designated Activity Company [2023] ZACT 26 (30 March 2023). There were several questions in the matter, including the jurisdiction of the South African competition authorities to investigate and prosecute firms not incorporated or operating in South Africa (pure peregrini). The Competition Commission (the Commission) had initiated proceedings in the Tribunal against a host of banks for alleged cartel conduct, and some of the respondent banks raised objections and exceptions relating to the jurisdiction of the South African competition authorities. The note observes that while national competition authorities may have prosecutorial jurisdiction against cross-border cartels, there is still a challenge in enforcing an order where cartels are non-resident in the country. The contribution also notes potential challenges to cartel enforcement on the African continent in light of the establishment of the African Continental Free Trade Area (AfCFTA). Due to the removal of various trade barriers, there is likely to be a rise in cross-border competition issues, including cross-border mergers and cross-border cartels. The note therefore discusses a pertinent issue, that of jurisdiction, which may well be a challenge within the AfCFTA.

The moderating role of corporate governance mechanism on the relationship between product market competition and earnings management: evidence from Bangladesh

ABSTRACT This article evaluates the moderating effects of corporate governance mechanisms on the relationship between earnings management and product market competition. Market concentration, as measured by the HHI has shown significantly negative association with accrual and real earnings management. In contrast, product market power, as measured by the industry size, demonstrates a significant positive association. The result further illustrates that the cost of industry entry significantly impacts accrual earnings management. The corporate governance mechanism (CGI) significantly decreases earnings manipulation. Moreover, the corporate governance mechanism (CGI) considerably moderates the association between market concentration, industry entry cost, and earnings management. Compared to high and low-competitive industries, the impact of market competition on earnings management in moderately competitive industries is more significant. After establishing the Bangladesh Competition Commission, product market competition has shown more impact on earnings management. This research is the initial attempt to examine the moderating effect of corporate governance mechanisms on the relationship between product market competition and earnings management from the perspective of Bangladesh.

Policy uncertainty, mergers, and acquisitions in the South African business environment

ABSTRACT This study examines policy uncertainty on mergers and acquisitions (M&A) in South Africa, emphasising the extensive regulatory review by the Competition Commission under the ‘public interest consideration’ criterion. It aims to identify the cost implications and uncertainties associated with M&A transactions to propose measures to reduce these uncertainties. Utilising qualitative methodologies, the study gathers empirical evidence through interviews with companies and competition lawyers involved in the M&A processes. The findings reveal significant concerns about economic uncertainty, merger control, and policy and regulation impacting investment decisions. Policy uncertainty, particularly in the context of merger regulation, imposes substantial cost implications and delays on M&A activities, negatively affecting investment, growth, and economic development. It emphasises the necessity for a regulatory framework that minimises disruptions and costs to business participants. The findings suggest that addressing policy uncertainty and streamlining regulatory processes are crucial steps towards enhancing South Africa's attractiveness as an investment destination and fostering economic growth and development.

State aid for broadband network deployment: National and subnational governance mechanisms, 2003–2023

This paper examines the governance models of State aid measures for broadband network deployment in European Union Member States. The research is based on 199 decision letters collected from the European Commission's competition cases database, published between 2003 and 2023. Deploying a theory-driven content analysis approach, the analysis reveals and categorises a variety of governance models. These models vary regarding the authority responsible for the decision-making and, in the case of national schemes, the authority responsible for the implementation, including centralised and decentralised arrangements. Different legacies and institutional set-ups explain the governance models, including the typology of state structures, the constitutional powers, the traditions of participation in the telecommunication sector, policy diffusion and regional development. There are several possible pathways to a gradual transition from one model to another. The design of flexible national schemes, which offer subnational authorities the option to implement them in their regions or to rely on central management agencies for specific tasks adapted to their interests, resources and capacities, could be the optimal solution to prevent the launch of ad hoc measures by subnational authorities and to adapt to different institutional arrangements.