indivisibility must be shown on a factual and/or legal basis. The factors are not exhaustive and do not take away the Commission’s ultimate discretion, so the Commission will continue to consider each matter on a case-by-case basis.

 

Guidelines on internal restructuring

The Commission published the final Guidelines on Internal Restructuring on 4 April 2025. For a long time, the legal position on whether internal restructurings require merger approval before implementation has been uncertain, and the Commission has often (but not consistently) relied on case precedents of the Competition Tribunal and Competition Appeal Court to determine its approach to internal restructurings. The purpose of the guidelines is to bring more certainty to the Commission’s approach. The guidelines confirm that notifying an internal restructuring may be required only in limited circumstances. As a point of departure, the Commission will examine the current control structure, and that which will exist after the restructuring has been implemented. The emphasis seems to be on the effect an internal restructuring may have on external minority shareholders. For restructuring transactions not to trigger any notification requirements, the intra-group reorganisation must not change the control rights of external minority shareholders. The Commission also recognises the different formats in which internal restructurings can be structured. Accordingly, transacting parties must have due regard for the Commission’s approach when reorganising internal structures.

 

A re-focus on competition concerns?

The Tribunal recently issued its reasons for prohibiting the transaction involving South Africa’s largest mobile operator, Vodacom, and one of the country’s largest fibre infrastructure players, Maziv, due to its findings that “the proposed transaction’s anti-competitive effects will be permanent”. The Tribunal agreed with the Commission’s recommendation that the proposed public interest commitments offered by the parties were not merger-specific, and weighed them against the anti-competitive effects of the merger. The Tribunal found that the overall net effect of the proposed transaction would be negative. The lengthy investigation period (approximately 36 months), voluminous record comprising nearly 22,000 pages, and the Tribunal’s 350-page reasons issued five months after its order, testify to the complexities of the case and the authorities’ balancing of competition effects and public interest considerations.

 

Separately, in the Peermont/Sun International transaction, the Commission found that the proposed merger would significantly reduce competition in the casino gambling services market in South Africa and has recommended its prohibition. The proposed transaction would reduce the number of national casino operators from three to two, which would cause a further increase in concentration in an already highly concentrated market. Similarly, the investigation took approximately six months. The Tribunal has yet to hear the matter since the Commission recommended its prohibition in October 2024.

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Final thoughts

Although not binding, the guidelines should be carefully considered by businesses when structuring transactions intended to be notified as single mergers or internal restructurings. When considering a transaction that may have competition concerns, it is vital for businesses to remember that offering a plethora of public interest commitments may not necessarily overcome the anticompetitive effects of a merger.  

 

Mogapi is a Partner and Suliman an Associate | Webber Wentzel