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South Africa plans changes to antitrust rules on reporting mergers that could ease the cost of doing business for some firms.<\/p>\n
The Department of Trade Industry and Competition proposes raising the lower threshold \u2014 or the minimum size at which mergers need to be reported to antitrust authorities \u2014 to R1 billion ($62 million) of combined annual turnover or assets from R600 million currently, it said in draft rules published for comment Tuesday.<\/p>\n
It also plans to increase the notification trigger for the target business\u2019s turnover or assets by 75% to R175 million.<\/p>\n
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The DTIC proposed increasing the so-called higher threshold that applies to large mergers to R9.5 billion for combined turnover or assets from R6.6 billion now, and to R280 million from R190 million for the target firm.<\/p>\n
Raising the threshold could reduce legal costs, enable faster deal execution and lower the compliance burden in Africa\u2019s biggest economy, where annual growth hasn\u2019t exceeded 1% for the past decade because of graft constraints, underinvestment in infrastructure, logistics snarl-ups and insufficient energy supply.<\/p>\n
President Cyril Ramaphosa in October 2020 set up Operation Vulindlela, a unit within his department to fast track reforms to fire up the economy.<\/p>\n
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