Martin Endjala
The Namibia Competition Commission (NACC) has fined Choppies Supermarket Namibia Pty Ltd N$2.2 million for implementing a merger without its approval.
According to an investigation by NaCC, Choppies entered into a settlement agreement with Johannes Jacobus De Jager trading as Grootfontein Supermarket and Grootfontein Bottle Store a transaction amounting to a merger without the prior approval.
Choppies and Grootfontein Supermarket and Grootfontein Bottle Store entered into a memorandum of agreement on 12 May 2022 and 19 May 2022.
Dina //Gowases, the NaCC corporate communications practitioner, confirmed this on Thursday in a statement.
“The merger falls within the prescribed notification thresholds, and the parties failed to notify the Commission, as required in terms of Section 44 of the Act,” she said.
NaCC and Choppies have agreed to settle the matter and entered into a settlement agreement, where they agreed to pay a pecuniary penalty for the fine and implement a compliance programme on competition law in Namibia.
She said the settlement agreement entered between Choppies and the Commission was made following a court ruling by the High Court on 19 November 2024, in favour of NaCC.
The parties to the merger operate in the commission’s defined market of fast-moving consumer goods, such as the selling of goods to consumers, that generally have a short shelf life, in relatively small quantities for use or consumption rather than the resale.
In its investigation, the commission found that, although the transaction did not have a negative impact on competition due to the existing market concentration in the town of Grootfontein at the time of the transaction, the transaction breached the notification thresholds made pursuant to the Competition Act.
//Gowases said investigations by NaCC of mergers implemented without prior approval are not a mere punitive exercise, but a realization of the commission’s mandate to ensure fair market competition for inclusive growth and development.
All mergers above the monetary thresholds are notified to the commission, to ensure the protection of consumer rights, opportunities, and the general welfare of the competitive landscape.
She explained that competition enforcement and merger regulation establish a system of preventive control against increases in market power.
This is to prevent market structures that are conducive to anti-competitive conduct from developing, and the assessment of mergers enables the commission to implement such a preventative control system, prior to the implementation of a transaction.
