South Africa: Constitution Amendment Bill Has Potential To Significantly Affect Competition Law In SA

Last Updated: 2 July 2012
Article by Lee Mendelsohn

Most Read Contributor in South Africa, September 2016

An amendment contained in the Constitution 17th Amendment Bill, which has received little attention thus far, is one which could potentially permanently alter the system of appeal in specialised courts. This amendment, if implemented, will have a dramatic effect on the South African competition law regime.

This is according to Lee Mendelsohn, Director and Head of Department (Competition) at ENS – Africa's largest Law firm, who says the amendment bill has the effect of limiting the Supreme Court of Appeal's powers to adjudicate matters of appeal from certain specialised courts, in particular the Competition Appeal Court.

"If the bill becomes law, the result will be that the Competition Appeal Court and not the Supreme Court of Appeal will become the apex court for all competition-related matters."

According to Mendelsohn, the constitution is currently drafted such that decisions of the Competition Appeal Court can, with leave from the Competition Appeal Court, be appealed to the Supreme Court of Appeal or the Constitutional Court in relation to certain matters listed in the Competition Act. The Constitution currently provides that the Supreme Court of Appeal "may decide appeals in any matter".

The bill will amend section 168 of the Constitution by the substitution for subsection (3) of the following subsection:

"(3)(a) The Supreme Court of Appeal may decide appeals in any matter arising from the High Court of South Africa or a court of a status similar to the High Court of South Africa, except where an Act of Parliament provides otherwise.

(b) The Supreme Court of Appeal may decide only –

  1. appeals;
  2. issues connected with appeals; and
  3. any other matter that may be referred to it in circumstances defined by an Act of Parliament."

Because the Competition Act sets out that the Competition Tribunal and Competition Appeal Court have exclusive jurisdiction in regard to certain matters, the amendment to section 168 will have the effect articulated above.

Mendelsohn says proponents of the amendment contend that competition matters require specialised courts and judges, as they involve complex matters of economics, law, commerce, industry and public affairs, whilst the Supreme Court of Appeal is a generalist court, which deals with all areas of the law.

"The specialist bodies designated for this purpose are the Tribunal and the Competition Appeal Court. As specialist bodies involved in these matters on a daily basis, they have the required specialist knowledge and will be empowered by their exclusive jurisdiction to develop a consistent body of competition law precedent."

Mendelsohn says an added benefit of the amendment is that a it will allow for more efficient finalisation of competition matters, and will avoid possible abuses that flow from the ability to appeal competition law matters to the SCA.

According to Mendelsohn, opponents of the amendment have noted that the removal of the ability to appeal a decision of the Competition Appeal Court to the Supreme Court of Appeal effectively renders the first court of appeal, namely the Competition Appeal Court, also the last court of appeal.

"An obvious benefit to an appeal process is that it allows for checks and balances. One of the benefits to having a multitude of avenues for appeal is that the greater the scrutiny, the greater the chance that the correct decision will ultimately be reached. In addition, competition law is governed by the Competition Act, which is a law subject to the same legal application as any other law. Therefore, it is arguable that much benefit can be gained from allowing South Africa's senior judges an opportunity to play a role in its development," she says.

Mendelsohn expects that the focus of the opposition to the bill will be on the constitutional issues rather than the effect on South African competition law.

"In light of this opposition, it is unclear if the bill will be passed in its current form. However, if the bill does become law, the landscape applicable to competition law in South Africa will be forever changed," says Mendelsohn.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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