Competition Commission of South Africa v Hosken Consolidated Investments Limited and Another

Hosken Consolidated Investments Limited (HCI) acquired de facto control over Tsogo Sun Holdings Limited (Tsogo) in 2014 following the exit of SABMiller, holding approximately 47.61% of Tsogo’s shares. This large merger was notified and unconditionally approved by the Competition Tribunal, with the Commission noting HCI’s stated intention to later increase its shareholding beyond 50%. In 2017, HCI restructured its internal gaming interests, increasing its shareholding in Tsogo to above 50% and thereby acquiring de jure control. HCI sought an advisory opinion from the Competition Commission, which indicated that the transaction crossed the ‘bright line’ of section 12(2)(a) of the Competition Act and was therefore notifiable. HCI and Tsogo disputed this and sought declaratory relief from the Competition Tribunal, which declined jurisdiction. The Competition Appeal Court overturned that decision and held the transaction non-notifiable. The Commission appealed to the Constitutional Court.

Leave to appeal was granted and the appeal was upheld to a limited extent. The order of the Competition Appeal Court was replaced with a declaration that HCI was not obliged to notify the 2017 transaction under section 13A of the Competition Act, but that this did not preclude the Competition Commission from investigating assurances made in the 2014 merger. No order as to costs was made.

The case authoritatively affirms the ‘once-off’ principle in South African merger control, clarifying that a change in the form of control from de facto to de jure does not trigger a new notification where control was previously approved. It also confirms the Competition Tribunal’s power to grant declaratory relief, reinforcing access to courts and legal certainty in competition law.