Final Guidelines on the Exchange of Competitively Sensitive Information has been published
26 Apr 2023
1. The Competition Commission published its final Guidelines on the Exchange of Competitively Sensitive Information (“the Guideline”) in the Government Gazette No. 48104.
2. The Guideline sets out detail around the type of information exchange or sharing of competitively sensitive information that may potentially be harmful to competition and when such exchange or sharing of information may enhance efficiencies.
3. “Competitively sensitive information” is defined very broadly as:
“Information that is important to rivalry between competing firms and is likely to have an appreciable impact on competition (for example price, output, product quality, product variety or innovation). Competitively sensitive information could include prices, customer lists, production costs, quantities, turnovers, sales, capacities, qualities, marketing plans, risks, investments, technologies, research and development programmes and their results.”
4. The Guideline further sets out the Competition Commission’s general approach to determining whether information that is exchanged or shared between firms that are competitors, amounts to an exchange of competitively sensitive information in contravention of section 4 of the Competition Act (Act no. 89 of 1998) (as amended) (“the Competition Act”).
5. The exchange of competitively sensitive information between competitors that involves information that can give rise to direct or indirect price fixing, division of markets or collusive tendering is outright prohibited by the Competition Act and no defence can be raised against it by any party involved. The exchange of competitively sensitive information that substantially prevent or lessen competition is also prohibited by the Competition Act, although a party that exchanged or shared such information with a competitor may raise in defence that there were pro-competitive, technological and/or efficiency gains from the information exchange that outweighed its anti-competitive effects.
6. Factors that the Competition Commission will consider when evaluating the effect of the exchange or sharing of competitively sensitive information between competitors are –
6.1 the features and characteristics of the relevant market;
6.2. whether the information exchanged is/was historical, current or relating to future conduct;
6.3. the mechanism through which the information is/was exchanged and accessibility of the exchanged information to the public;
6.4. indispensability of the information exchanged.
Article sourced from Gildenhuys Malatji Incorporated.
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