The Competition Commission outlined the inquiries it conducts into markets ranging from digital to agriculture.
The Portfolio Committee on Trade, Industry and Competition today received a briefing from the Competition Commission on its first, second and third quarter performance for the 2023/24 financial year.
The committee Chairperson, Ms Judy Hermans, commended the work the Competition Commission has done on market enquiries and investigations into prohibited conduct. In addition, the committee welcomed the update on the commission’s performance in the period under review. There has been a general improvement in terms of the percentage of targets achieved from quarter one (69% of quarterly targets met) to quarter three (82% of quarterly targets met).
“While the committee acknowledged the areas of good performance, there were still some areas for improvement,”
Ms Hermans said.
The 2019 Competition Amendment Act introduced market inquiries as a tool for the commission to use to better understand the competition landscape within an industry and to identify problem issues such as market concentration. The commission has conducted a number of these inquiries over the years, including ones on data services and online intermediation platforms. The Data Services Market Inquiry had a positive impact on the cost of data, which was especially beneficial during the Covid-19 pandemic, for example. Furthermore, the online intermediation platforms market inquiry is expected to open the online market to smaller South African players.
In terms of enforcement measures, the committee heard that work is being done in the food and agricultural sectors, as well as the energy, retail and health sectors. In the energy sector, this included a referral against SASOL on the pricing of piped gas. Meanwhile, in the grocery retail sector, consent agreements with national retail chains to end long-term exclusive lease agreements have been finalised. This is expected to allow small, medium, and micro enterprises (SMMEs) and historically disadvantaged supermarket owners to become anchor clients at shopping malls, thus increasing consumers’ choices and possibly reducing prices, Ms Hermans said.
The commission also briefed the committee on its current investigation on the alleged forex manipulation by banks. The investigation found that banks colluded in allocating customers on the South African rand/US dollar currency pair. The commission is now awaiting a decision from the Constitutional Court for leave to appeal the Competition Appeal Court judgement handed down on 8 January 2024, in which it upheld the appeal by most of the respondent banks accused of price fixing and division of markets in contravention of section 4 (1) of the Competition Act 89 of 1998.
The committee welcomed the progress made on this investigation and encouraged the commission to continue its work to hold companies accountable for anti-competitive behaviour that harms the South African economy. Ms Hermans said the committee would like further engagements with the commission on this case.
