Sustainability and Competition Global Practice Guide |
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South Africa |
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| (Africa) Firm Bowmans Updated 06 Sep 2022 | |
| Are ESG measures/sustainability agreements included in your jurisdictional competition regime? | Not currently. |
| If ESG measures/sustainability agreements are not included in your jurisdictional competition regime, do you foresee any new regulations coming into place in 2022? | Not at this stage. |
| Has your Authority issued any guidance on the role, if any, of ESG in the competition law analysis applied to mergers or other conduct? | No. |
| Has your jurisdiction issued guidance regarding competitor collaborations or participating in industry working groups, and if so, do they specifically address ESG? | The South African Competition Commission ("Commission") has issued various guidelines relating to competitor collaboration. However, none of these guidelines deal specifically with ESG. In July 2017, the Commission published Draft Guidelines on the Exchange of Information between Competitors under the Competition Act, which generally explain when the exchange of information between competing firms could facilitate coordination and may be harmful to competition. These guidelines also propose safeguards to mitigate against the risks associated with the exchange of competitively sensitive information. In March 2022, the Commission issued its “Final Guidelines on Collaboration between Competitors on Localization Initiatives”. These guidelines were issued in the context of South Africa’s Economic Reconstruction and Recovery Plan and involve discovering potential opportunities to increase local supply through engagements between suppliers and/or competitors. |
| Can parties seek specific guidance from authorities on proposed ESG initiatives? | Yes. In the ordinary course, the Commission is open to engaging with parties seeking specific guidance. However, the Commission is not able to issue any formal advisory opinions, as regulations empowering the Commission to issue such opinions are not yet in effect. Notably, however, advisory opinions are non-binding on the Commission and, therefore, once the Commission is able to issue advisory opinions, they will be non-binding in nature. |
| How, if at all, does your jurisdiction quantify or calculate the ESG effects? | Not applicable at this stage. |
| What does your legal authority currently permit even if your agency is not yet active on this topic? | Competitor interaction is permitted provided that such interaction does not lead to an agreement or concerted practice constituting or giving rise to price fixing, market division or collusive tendering, or to an exchange of competitively sensitive information resulting in a substantial prevention or lessening of competition. Initiatives that may otherwise be prohibited, may be authorized by the Commission by way of an application for exemption if the application is successful. |
| Are there precedents that involved ESG/sustainability matters in your country? If so please provide a short description. | Yes. There are examples of the South African competition authorities considering matters relating to ESG. For example, in June 2021, in the merger involving Air Liquide Large Industries South Africa (Pty) Ltd and the Business of owning and operating 16 air separation units of Sasol South Africa Limited, following engagements with the Commission and the Department of Trade, Industry and Competition, the Competition Tribunal approved the merger subject to a range of public interest conditions, including commitments by the merging parties to reduce carbon emissions and making surplus oxygen available to customers in the healthcare sector. The Competition Tribunal’s press release is available here: https://www.comptrib.co.za/info-library/case-press-releases/air-liquide-acquires-16-air-separation-units-owned-and-operated-by-sasol-subject-to-public-interest-conditions-imposed-by-the-tribunal |
| Is there specific antitrust regulation in your jurisdiction to be aware of which might give rise to private or class action ESG litigation? | No. |
Sustainability and Competition Global Practice Guide
Not currently.
Not at this stage.
No.
The South African Competition Commission ("Commission") has issued various guidelines relating to competitor collaboration. However, none of these guidelines deal specifically with ESG.
In July 2017, the Commission published Draft Guidelines on the Exchange of Information between Competitors under the Competition Act, which generally explain when the exchange of information between competing firms could facilitate coordination and may be harmful to competition. These guidelines also propose safeguards to mitigate against the risks associated with the exchange of competitively sensitive information.
In March 2022, the Commission issued its “Final Guidelines on Collaboration between Competitors on Localization Initiatives”. These guidelines were issued in the context of South Africa’s Economic Reconstruction and Recovery Plan and involve discovering potential opportunities to increase local supply through engagements between suppliers and/or competitors.
Yes. In the ordinary course, the Commission is open to engaging with parties seeking specific guidance. However, the Commission is not able to issue any formal advisory opinions, as regulations empowering the Commission to issue such opinions are not yet in effect. Notably, however, advisory opinions are non-binding on the Commission and, therefore, once the Commission is able to issue advisory opinions, they will be non-binding in nature.
Not applicable at this stage.
Competitor interaction is permitted provided that such interaction does not lead to an agreement or concerted practice constituting or giving rise to price fixing, market division or collusive tendering, or to an exchange of competitively sensitive information resulting in a substantial prevention or lessening of competition. Initiatives that may otherwise be prohibited, may be authorized by the Commission by way of an application for exemption if the application is successful.
Yes. There are examples of the South African competition authorities considering matters relating to ESG. For example, in June 2021, in the merger involving Air Liquide Large Industries South Africa (Pty) Ltd and the Business of owning and operating 16 air separation units of Sasol South Africa Limited, following engagements with the Commission and the Department of Trade, Industry and Competition, the Competition Tribunal approved the merger subject to a range of public interest conditions, including commitments by the merging parties to reduce carbon emissions and making surplus oxygen available to customers in the healthcare sector. The Competition Tribunal’s press release is available here: https://www.comptrib.co.za/info-library/case-press-releases/air-liquide-acquires-16-air-separation-units-owned-and-operated-by-sasol-subject-to-public-interest-conditions-imposed-by-the-tribunal
No.