Original Research

Theory and practice in the use of merger remedies: Considering South African experience

Genna Robb, Avias Ngwenya
Journal of Economic and Financial Sciences | Vol 4, No 3 | a374 | DOI: https://doi.org/10.4102/jef.v4i4.374 | © 2018 Genna Robb, Avias Ngwenya | This work is licensed under CC Attribution 4.0
Submitted: 01 July 2018 | Published: 31 August 2011

About the author(s)

Genna Robb, Centre for Competition Economics, University of Johannesburg; and Competition Commission, South Africa
Avias Ngwenya, Centre for Competition Economics, University of Johannesburg; and Competition Commission, South Georgia and the South Sandwich Islands

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Abstract

There has been considerable debate internationally around the relative advantages and disadvantages of structural and behavioural remedies. In mergers which raise competition concerns, prohibition or divestiture may prevent merger efficiencies from being realised, and therefore behavioural remedies may seem attractive. However, these can prove difficult or impossible to enforce in practice. The merger approval rates of the South African competition authorities are in line with the practice of international agencies, but the number of behavioural remedies imposed is relatively high. This paper briefly considers the international literature on merger remedies before analysing South African merger decisions and making a comparison with other jurisdictions. It then presents a review of a decision made by the Tribunal in the merger between Astral Foods and National Chick in 2001, which was approved with both structural and behavioural conditions. Finally, the paper draws conclusions for the design of remedies in future.

Keywords

merger; remedy; behavioural; structural; South Africa

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