Mergers Week Day 4: What Does the Authority Consider in Analysing a Proposed Merger?

In terms of section 52(1) of the Competition Act in assessing a proposed merger, the Authority shall first determine whether the merger –

a)    Would be likely to prevent or substantially lessen competition or to restrict trade or the provision of any service or to endanger the continuity of supplies or services; and

b)    Would be likely to result in any enterprise, including an enterprise which is not involved as a party in the proposed merger, acquiring a dominant position in a market.

Section 52) further states that, the authority may in addition, consider any factor which, the authority considers bears upon the broader public interest in the proposed merger including the extent to which –

a)   The proposed merger would be likely to result in a benefit to the public which would outweigh any detriment attributable to a substantial lessening of competition or to the acquisition or strengthening of a dominant position in a market.

b)   The merger may improve, or prevent a decline in the production or distribution of goods or the provision of services.

c)   The merger may promote technical or economic progress, having regard to Botswana’s development needs.

d)   The proposed merger would be likely to affect a particular industrial sector or region.

e)   The proposed merger would maintain or promote exports or employment.

f)     The merger may advance citizen empowerment initiatives or enhance the competitiveness of citizen owned small and medium sized enterprises; or

g)   The merger may affect the ability of national industries to compete in international markets.