Competition Commission v Coca-Cola Beverages Africa (Pty) Ltd and Another

Following the approval of two related mergers involving Coca-Cola bottling operations in South Africa, Coca-Cola Beverages Africa (CCBA) became subject to detailed employment-related merger conditions under section 12A(3) of the Competition Act 89 of 1998. These conditions prohibited merger-specific retrenchments, particularly of bargaining unit employees, for a defined period, while allowing retrenchments for genuine operational requirements. In 2018–2019, approximately one to one-and-a-half years after the second transaction, CCBA retrenched about 368 bargaining unit employees, citing adverse economic conditions, declining sales, increased competition, and the imposition of the Health Promotion Levy (sugar tax). The Food and Allied Workers Union (FAWU) complained to the Competition Commission that these retrenchments breached the merger conditions. The Commission issued a Notice of Apparent Breach under Rule 39(1). CCBA elected to approach the Competition Tribunal under Rule 39(2)(b) to review and set aside the Notice, asserting substantial compliance with the merger conditions. The Tribunal agreed with CCBA. The Competition Commission appealed to the Competition Appeal Court.

Condonation for late filing of the appeal was granted. The appeal on the merits was determined by the Competition Appeal Court, which upheld the Tribunal’s conclusion that CCBA had substantially complied with the merger conditions and that the retrenchments were not proven to be merger specific. The Notice of Apparent Breach remained set aside.

This judgment is significant for clarifying the nature and limits of the Competition Tribunal’s review powers under section 27(1)(c) of the Competition Act and Rule 39(2)(b). It provides authoritative guidance on how merger-related employment conditions must be interpreted and enforced, and on the distinction between merger-specific retrenchments and permissible operational retrenchments. The case also underscores the careful balance between competition regulation and labour law, reinforcing that competition authorities may only intervene in employment matters within the scope of the Competition Act.