Competition Commission of South Africa v Bank of America Merrill Lynch International Ltd and Others

The Competition Commission initiated a complaint in April 2015 against numerous local and foreign banks, alleging collusion to fix prices and divide markets in respect of the rand–US dollar exchange rate, in contravention of section 4(1)(b)(i) and (ii) of the Competition Act 89 of 1998. The alleged conduct largely occurred outside South Africa and involved banks, some with no domicile or business presence in the Republic (pure peregrini) and others with limited local presence (local peregrini). The matter was referred to the Competition Tribunal. Numerous procedural steps followed, including supplementary affidavits, exceptions, and attempted joinder of additional foreign banks. The Tribunal held it lacked personal jurisdiction over pure peregrini banks but nevertheless issued a limited declaratory order against them, while requiring further particulars from the Commission in respect of local peregrini. Appeals and cross-appeals were lodged to the Competition Appeal Court concerning jurisdiction, extraterritorial application of the Act, joinder, and the competence of the declaratory order.

The appeal by the pure peregrini banks succeeded. The declaratory order issued by the Competition Tribunal against the pure peregrini respondents was set aside. The Competition Commission’s cross-appeal on jurisdiction was dismissed. Issues relating to joinder and review fell away or were rendered moot in light of the jurisdictional finding.

This judgment is a leading South African authority on the limits of extraterritorial enforcement of competition law. It clarifies that although the Competition Act has extraterritorial reach based on effects within South Africa, the Tribunal must still establish personal jurisdiction over foreign respondents. The case underscores the continued relevance of common-law jurisdictional principles in competition enforcement and constrains the Commission’s ability to proceed against purely foreign firms without submission, attachment, or another recognised basis for jurisdiction.