As of 1 October 2017, new merger notification thresholds and
filing fees will apply to mergers that are compulsorily notifiable
to the South African Competition Commission.
In terms of the amendments, the threshold for an intermediate merger will be met where:
- the acquiring and target firms have a combined turnover or assets (whichever combination is higher) of R600 million or more (currently the merger threshold amount is R560 million); and
- the target firm has a turnover or assets (whichever is the
higher) of at least R100 million (currently the merger threshold
amount is R80 million).
The thresholds for large mergers remain unchanged.
The revised merger filing thresholds are as shown in the table below.
New Merger Filing Thresholds
Small merger: Merging parties' combined
turnover or asset value is less than R600 million OR Target
firm's turnover or asset value is less than R100 million.
Intermediate merger: Merging parties' combined turnover or asset value is greater than R600 million, but less than R6,6 billion AND Target firm's turnover or asset value is greater than R100 million, but less than R190 million.
Large merger: Merging parties' combined turnover or asset value is greater than R6.6 billion AND Target firm's Turnover or asset value is greater than R190 million.
The second amendment relates to filing fees for merger notifications. The notification fee will be increased to
- R150,000 for filing an intermediate merger (the current filing fee for intermediate mergers is R100,000); and
- R500,000 for filing a large merger (the current filing fee for large mergers is R350,000).
The new thresholds and filing fees are published in Government Gazette No. 41124, which also invites interested persons to submit written comments on proposed amendments to the Method of Calculation by 15 October 2015.
The amendments are made in line with the Minister of Economic Development's Budget Vote Speech on 25 May 2017, where he stated that merger filing fees would be increased "to improve resources for the competition authorities".
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.