Public Interest Conditions in South African Mergers: A post Covid-19 Analysis

This paper provides an empirical assessment of public interest conditions (PICs) in South African merger control in the period 2010–2024, with particular emphasis on the post-Covid-19 environment and the 2018 amendment to the Competition Act. Building on earlier work by Van Wyk, Pretorius and Blaauw (2023), which analysed PIC enforcement up to 2019, the study examines whether the nature, intensity and determinants of public interest conditions have evolved in response to economic shocks and regulatory reform. The literature shows that employment, supplier development funds and black economic empowerment (BEE) have historically dominated merger conditions, with enforcement influenced by merger size, sector and duration. However, limited empirical evidence exists for the post-2020 period. Using pooled cross-sectional data for 435 mergers containing PICs and estimating logit models with binary dependent variables, the analysis evaluates the determinants of employment, BEE, development fund and employee share ownership programme (ESOP) conditions. The results largely confirm earlier findings: duration and firm size remain important predictors of PIC imposition. However, new patterns emerge. ESOP conditions, introduced after 2019, have become a distinct ownership-spread instrument, particularly in international and mining mergers. The Covid period is associated with continued or increased BEE enforcement, suggesting that transformation objectives were not relaxed during economic crisis. Overall, the findings indicate continuity in structural determinants but growing differentiation in the instruments used to achieve transformation objectives, highlighting the evolving role of merger control in balancing inclusive growth, regulatory certainty and investment stability in South Africa.