Competition Policy and Practice in South Africa: Promoting Competition for Development Symposium on Competition Law and Policy in Developing Countries

Hartzenberg, Trudi | January 1, 2006

South Africa’s new competition policy and law were drafted during the early years of South Africa’s new democracy, a period characterized by important domestic policy and regulatory reform. These reforms were not only part of the comprehensive program for the country’s economic, social, and political transformation, but also its integration into the global economy after decades of isolation under the apartheid regime. In the case of competition policy, however, concerns about specific development challenges entrenched by the previous era of political and economic control, had to be explicitly reflected in the new South Africa’s law and policy. It was clear that a robust competition law would only be politically possible if the law specifically addressed public interest concerns. The core focus of economic efficiency had to be tempered by a strong emphasis on development. In the end, the new competition law, even with the broad sweep of its objectives, puts economic efficiency center-stage. Public interest objectives are articulated alongside the goal of economic efficiency. Only as the jurisprudence develops will the nature of the trade-offs within this nexus of objectives become clear. This paper reviews briefly the new 1998 Competition Act (“Competition Act” or “Act”) and the institutions established to enforce the new law. The new Act marks a significant step in the development of effective market governance in South Africa. However, much remains to be done to develop capacity, in particular the institutional capacity for effectively enforcing competition law, and complementary regulatory frameworks that will support the broad competition policy objectives that reach beyond efficiency to encompass public interest objectives. And perhaps even more important, especially in light of recent investigations into alleged restrictive practices and cases that have been heard, there remains much to be done to change firm behaviour from mere maneuvering around competition law to effective compliance.