On 22 June 2016, the Directorate General for Competition of the European Commission ("DG Competition") and the Competition Commission of South Africa ("CC") signed a Memorandum of Understanding ("MoU") on cooperation in the field of competition law and enforcement.

This is an important step evidencing DG Competition's and CC's intent to strengthen further levels of cooperation between them. It follows swiftly on from the CC's conclusion in May of a MoU with the competition authorities in Brazil, Russia, India, and China. The document forms part of the now extensive and established network of MoUs and cooperation agreements between antitrust agencies across the world, and sits within the context of cooperation taking place within international organisations such as the Organisation for Economic Cooperation and Development ("OECD") and the International Competition Network ("ICN").

When establishing antitrust strategy, companies need to bear in mind the increasing trend for cooperation between antitrust authorities around the world. Cooperation occurs right across the board in all enforcement areas (mergers, cartels, and conduct). Cooperation in any individual case may take many forms from agencies occasionally "touching base" with each other to deep and frequent cooperation on individual cases.

Key provisions

The key provisions of the MoU include the following.


Information exchange

The authorities acknowledge that it will be in their mutual interest to exchange non-confidential information with regard to:

  • Competition policy and enforcement developments in their respective jurisdictions.
  • Operational issues affecting efficiency and/or effectiveness.
  • Multilateral competition initiatives, such as interactions with the ICN, the OECD, the World Intellectual Property Organisation, and the United Nations Conference on Trade and Development.
  • Competition advocacy, including raising awareness of companies and the wider public about competition legislation and enforcement.
  • Technical cooperation, including possible exchange of staff, and the organisation of seminars and training workshops.

Coordination

The MoU states: "Should the Sides pursue enforcement activities concerning the same or related cases they will endeavour to coordinate their enforcement activities, where this is possible."

Assistance

If either DG Competition or the CC believe that competition is being harmed by conduct in the other jurisdiction, the MoU states that one side may request the other side to initiate "appropriate enforcement activities as per its applicable competition law". When either authority receives that type of request, it will "consider the possibility" of an enforcement action and inform the other authority of what it decides to do.

Conflicts

The two authorities have agreed that they should try, to the extent possible, to avoid creating "adverse effects" for each other through their enforcement activities. In this respect, the MoU states: "Should one Side inform the other Side that enforcement activities of the latter may affect the informing Side's interests in its application of its competition law, the other Side will endeavour to provide an opportunity to exchange views and conduct consultations on the issues raised by the informing Side consistent with the interests of the Sides."

Impact

This formalises an informal practice in terms of which the CC and DG Competition have been cooperating up till now, including coordinating their enforcement action. For example, in respect of the freight forwarding investigation, the authorities in South Africa, the EU and the United States coordinated their dawn raids.

In its contribution to a 2014 UNCTAD roundtable on informal cooperation amongst competition agencies, while emphasising their independence the CC noted that case handlers have enjoyed consistent interaction over the years, and cooperation would hopefully harmonise enforcement and ultimately limit conflicts in respect of decision-making.

It remains to be seen how the MoU will operate in practice, but global business can hope that, with greater cooperation between DG Competition and the CC, investigations may be more efficient, and outcomes and remedies more consistent.