A comparative study on public interest considerations in the South African and Kenyan merger regime

Abstract

The South African and Kenyan competition policy and law recognise the importance of public interest as part of merger evaluation and hence provisions are made for these to be incorporated when mergers are considered. This study focusses on the public interest considerations in the context of merger regulation as applied in South Africa and compares these to the public interest considerations applied in Kenya’s merger regime. In addition to the “traditional” competition assessment, the Competition Authorities in South Africa and Kenya are also required to assess the effect of the merger on certain public interest factors. South Africa has a well-established merger regime, particularly in the application of public interest considerations which other jurisdictions may draw lessons from. Although certain key cases brought before the South African Competition Authorities have sparked a robust debate on the assessment standard for public interest issues, they have nonetheless laid down key principles in respect of public interest considerations and have provided a yardstick in the interpretation of public interest grounds in South African Competition Law. However, it is submitted that there is a need to strengthen the interpretation of public interest considerations in the South African merger as recommended in this study. Kenya boasts a modern competition law and has joined many African jurisdictions like South Africa who have adopted public interest considerations in the regulation of their merger regimes. The Kenyan Competition law regime, similar to South Africa, incorporate aspects of macro-economic or wider public goals such the consideration of the impact of a merger on a particular industrial sector or region, employment, ability of small undertakings to gain access to or to be competitive and the ability of national industries to compete in international markets. However, as discussed in this study, the lack of transparency in the determination of mergers which manifests itself in the non-publication of the Authority’s reasons for its merger decisions may pose a risk to the efficient regulation of mergers and significantly curtail the development of competition jurisprudence in Kenya.