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Competition Commission Market Inquiries Under the Spotlight

July 16, 2019

Department of Trade and Industry

16 July 2019

The trade and industry minister, Ebrahim Patel, has committed government to processing outcomes of Competition Commission Market Inquiries.

Delivering the trade and industry and economic development 2019 budget vote in parliament, the minister declared that relevant recommendations by the Market Inquiry into Data Services will be implemented to ensure that data prices fall.

Recommendations are expected by September 2019.

“We anticipate that there will be negotiation with the large cell-phone companies this year, to bring prices down,” he said.

Recommendations flowing from the Market Inquiry into shopping malls will also be considered to ensure that “commercial centres provide space for small retailers and to facilitate buyer groups for spaza shops to source more affordable goods”.

According to the minister, the “Commission plans to initiate one new market inquiry per year, complete more than 60 cartel investigations in the next five years, and initiate 10 investigations into abuse of market power by dominant firms”.

The minister also indicated that government’s “trade policy will be refocused so that tariff relief that is offered to domestic companies is accompanied by clear, enforceable commitments to invest more, expand output, create jobs and transform. In short, trade relief must be part of a package of reciprocal commitments to upgrade and improve industrial performance”.

Mention was made of the African Continental Free Trade Area (AfCFTA) connecting 1.2 billion people into a single trading bloc. It will come into effect on 1 July 2020.

“The Agreement will fundamentally change and reshape the South African economy. Already, exports to other African countries support about 250 000 South African jobs and it is the fastest growing part of our manufactured exports.”

In preparation, a tariff schedule will be finalised listing products to be covered by the AfCFTA and the rules of origin that clarify locally-manufactured articles.

Government will engage business and labour at Nedlac on outstanding areas and finalise agreements between all countries by the end of 2019.

Over the next five years, agreements on expanded trade in services, investment protections for African companies operating in other markets, competition policy and trade-related intellectual property rules will be developed.

As regards certain sections of the Competition Amendment Act that have come into force, the minister confirmed that outstanding sections providing small businesses with remedies against price discrimination by dominant firms or where dominant buyers abuse their power by imposing unfair prices and other trading conditions will come into effect by November 2019.

In terms of boosting industrial performance, the minister announced that work was underway with ministers Mantashe and Gordhan to “lower the cost structure of Eskom for more affordable electricity tariffs, particularly for priority sectors which need to be boosted to create jobs and inclusion”.

Meanwhile, draft standards on crude fish oil have been published for comment.

The trade and industry department published the proposed standards in Government Gazette 42576 for comment.

They were drawn up in terms of the Standards Act.

Other draft standards include live working – hand tools for use up to 1 000 V AC and 1 500 V DC; sewing machine couplers; rotating electrical machines – part 32; instrument transformers part 15: additional requirements for voltage transformers for DC applications; instrument transformers – part 11: additional requirements for low-power passive voltage transformers and specifications for particular types of winding wires.

In Notice 381, the department announced the withdrawal of standards on uniform provisions concerning the approval for the production of retreaded pneumatic tyres for commercial vehicles and trailers.

New and amended standards were also listed.