Ramaphosa announces imminent signing of competition amendment bill

By: Chris Charter – the National Head of Cliffe Dekker Hofmeyr’s Competition practice

Will SA’s competition bill hinder already sluggish M&A activity?

Delivering his state of the nation address (Sona) in Parliament last week, Ramaphosa committed to prioritizing the signing of the Competition Amendment Bill into law.

Geared primarily towards transforming the economy through aiding small-to-medium and black-owned businesses, the bill is anticipated to impact the local business landscape in a number of ways. This bill, however, has been met by various objections and concerns around the potential negative impact it could have on economic activity – in particular the already lagging merger and acquisition (M&A) market.

In response to these concerns, Chris Charter – the National Head of Cliffe Dekker Hofmeyr’s Competition practice – highlights that the thinking behind the new bill is not revolutionary for South Africa and should therefore not have an unexpectedly major impact in reality. “With South Africa’s BEE and related procurement legislation, the policy groundwork for these practices has already been laid for the most part. The intention of this new legislation is just to further drive the behaviour of big business in this respect. Moreover, the Bill is in line with emerging thinking in developed economies also.”