Unlike development driven by legislative reform, the evolution of the common law through the process of judicial precedent takes time. Here, development only occurs when the courts are seized with a case worthy of an evolutionary push and this means that, even when deficiencies in the law are self-evident, one has to wait for the judiciary to address the issue.
The law surrounding class actions in South Africa has not had the benefit of a legislative punt which would have sped up the process of legal development. It is therefore no surprise that any new (potential) class action raises excitement at the prospect of developing new law.
Against that background, the South African High Court’s recent decision refusing to certify a shareholder class action against a company’s directors, in the case of De Bruyn v Steinhoff International Holdings N.V. and Others (“Steinhoff”), is of great interest – particularly in illustrating the significant hurdles involved.
This brief addresses notable developments in competition law in South Africa and across the rest of Africa during the course of 2020. It includes the measures introduced by various competition law regulators in light of the COVID-19 pandemic and related cases and prosecutions.
Please click here for the detailed report.
For more information, please contact Jean Meijer, Nick Altini, Leana Engelbrecht, Sandhya Foster, Lesetja Morapi and Stewart Payne or your usual Herbert Smith Freehills contact:
Author: Peter Fabricius, Daily Maverick
But the reforms that the IMF would impose as conditions for the loan would save the economy, says Peter Leon.
South Africa will probably have to go back to the IMF for a much bigger loan than it has just got and this would come with conditions such as deep structural reforms to the economy.
These reforms would, however, be the “silver lining” on the immense fiscal crisis which the country now faces, exacerbated by the coronavirus pandemic, said Peter Leon, senior partner and co-chair of the African group at the law firm Herbert Smith Freehills.
Authors: Lesetja Morapi
1. In Competition Commission v Pickfords Removals SA (Pty) Ltd,1 the Competition Appeal Court (CAC) dealt with a number of issues including, relevant to this note, the effect of an amendment to a complaint initiation on the application of the statute of limitation prescribed by s67(1) of the Act.
2. The CAC had to determine the effective date of complaint initiation in circumstances where a firm was only expressly identified as a party to a prohibited practice by an amendment to an original complaint initiation which did not expressly name that firm. In particular, the CAC had to decide whether the three year period prescribed by s67(1) should be calculated from the date of cessation of the prohibited practice to the date:
Authors: Nick Altini, Leana Engelbrecht and Sandhya Foster (with research assistance from Lauren Paxton)
It is clear that the COVID-19 pandemic is already having a far-reaching impact on local, regional and global economies, with many firms facing severe financial constraints due to the limitations and government interventions introduced to tackle the global pandemic.
As humanitarian efforts are, generally, being placed ahead of commercial economic interests some firms are severely impacted by the economic slowdown and it is likely that the financial and economic impact of these interventions will have a long-lasting impact on businesses.
In the wake of this, it is probable that many firms will be placed in a distressed position and will explore merger opportunities as a means of avoiding business rescue, or even liquidation. Similarly, firms with more robust balance sheets will doubtless seek acquisition targets in friendly or hostile takeovers. Consolidation in many sectors is inevitable and will take place through a blend of attrition as a result of the lockdown and mergers where either or both firms seek to merge in order to survive in a far more Spartan market than that which existed before.
Author: PETER LEON
Short-term relief will not be enough if the government does not jolt the economy into life with breathtaking reforms.
It will be many months before we are able to assess the extent to which the Covid-19 pandemic has damaged the global economy. An unprecedented supply and demand shock has already led to a projected 16% unemployment rate in the US, the world’s biggest economy, with 26-million unemployment claims last week alone. This is four-and-a-half times more than the February 2020 unemployment rate. If this continues, the US unemployment rate will reach levels not seen since the Great Depression in 1934.
The International Monetary Fund (IMF) believes the global economy will contract 3% in 2020 — the worst global recession since the Great Depression. Dramatic reductions in supply and demand, falling commodity prices, outward capital flows and declining global growth all contribute to this. The fragility of many economies is evident, with developing countries suffering from an unhappy combination of a health, financial and fiscal crisis. SA is no exception.
Authors: Jean Meijer and Stewart Payne
Following our recent post on COVID-19 and its impact on competition law in Europe, South Africa has added its name to the list of countries using competition laws as a tool both to facilitate the healthcare response to the pandemic and protect consumers from exploitation.
On 15 March 2020, the COVID-19 pandemic was declared to be a national disaster in terms of the Disaster Management Act No. 57 of 2002 (as amended), from which followed on 18 March 2020 an extensive set of regulations made in terms of that Act. Shortly thereafter, and as part of the broader response to the pandemic, the Minister of Trade and Industry on 19 March 2020 issued regulations under two separate provisions the South African Competition Act No. 89 of 1998 (as amended):
Authority: David Butler
Professor David Butler is Emeritus Professor of law at Stellenbosch University, South Africa, and was the main advisor to the South African Government on the International Arbitration Act with his work as part the South African Law Reform Commission’s work reforming South Africa’s arbitration legislation. Professor Butler is a life fellow of the Association of Arbitrators of Southern Africa, and has authored authoritative texts on the subject of arbitration, including his textbook Arbitration in South Africa Law and Practice. He has also previously been chairperson of the Department of Mercantile Law at Stellenbosch and has taught Company Law.
In 2017, South Africa introduced its new International Arbitration Act following a quarter of a century of discussion regarding the reform of South Africa’s legislative regime. In this issue of Inside Arbitration, Director, Jonathan Ripley-Evans interviews Professor David Butler, Emeritus Professor of Law at Stellenbosch University, and main advisor to the South African government on the 2017 International Arbitration Act (the “IA Act”). They discuss the background to this reform and the Act on developments in South African law, as well as the current attitude of South Africa towards investment arbitration. They look at recent court decisions and consider the future of international arbitration in South Africa.
Edward Baring’s career comes closer to spanning the four corners of the globe than most. An Englishman, Baring completed his studies in the United Kingdom before moving to Moscow as a finance lawyer with Allen & Overy in the early years of this century. In 2016, Baring – having, in the interim, joined the partnership at Herbert Smith Freehills – relocated to South Africa to become managing partner of the firm’s Johannesburg office. He spoke to us about his unusual career.
CEELM: Run us through your background, and how you ended up in your current role with Herbert Smith Freehills in South Africa.
Authors: Peter Leon, Paul Morton, Amanda Hattingh and Ernst Muller
A year ago, on 27 February 2019, Total S.A. announced a major discovery of gas condensate in the Outeniqua Basin (Brulpadda prospect, Block 11B/12B) offshore South Africa. This deposit reportedly contains around one billion barrels of oil equivalent.1
This discovery had two significant consequences. First, it identified South Africa as one of the world’s new frontiers for oil and gas exploration. Second, it placed a spotlight on the inadequacy of South Africa’s existing regulatory regime and the urgent need to develop upstream petroleum legislation.