Pretoria - Future bank mergers
would be decided in terms of the
Competition Act if an amendment
bill put before Parliament
was approved at the next
parliamentary session, Menzi
Simelane, the Competition
Commissioner, said yesterday.
The section of the act that
precluded the Competition
Commission from having any
jurisdiction on the proposed
merger between Nedcor and Standard
Bank Investment Corporation
(Stanbic) would be deleted if
the bill was passed.
Simelane hoped the Second
Amendment Bill would be passed
by Parliament in September but
he pointed out that it would first
have to be discussed in Nedlac and
by the portfolio committee.
``If this amendment is passed,
then any future bank merger
would be decided in terms of the
Competition Act, which would
have concurrent jurisdiction with
other bodies such as the Registrar
of Banks,`` he said.
Bank mergers are deemed to
fall outside the jurisdiction of the
Competition Act No 89 of 1998
because of section 3(1)(d).
According to this section, the
provisions of the Competition Act
do not apply to ``acts subject to or
authorised by public regulation``.
Public regulation is defined as
``any national, provincial, or local
government legislation or subordinate
legislation, or any licence,
tariff, directive or similar
authorisation issued by a regulatory
authority or pursuant to any
statutory authority`` where
regulatory authority is ``any entity
established in terms of national,
provincial or local government
legislation or subordinate legislation
responsible for regulating
an industry or sector of any
industry``.
Simelane said the broad
interpretation of Section 3(1)(d)
had created a ``nonsensical
situation that was aggravated by
the Supreme Court`s judgment in
March``.
In that judgment, the court
ruled that the Competition
Authority did not have jurisdiction
over bank mergers save to
the extent permitted by section
37(2) of the Banks Act 1990.
Simelane said the controversial
section was not in the initial
draft of the Competition Bill but
was inserted by the portfolio committee
as a result of representations
made by some parastatals.
Although deleting the section
would give the Competition Authority
jurisdiction, David Lewis,
the chairman of the Competition
Tribunal, has indicated there
could be a case for allowing the
Registrar of Banks to have primary
jurisdiction in bank mergers.