dtic Highlights Public Interest Merger Conditions and ESD Alignment

Posted 26 May 2026 Written by Acts Online
Category Competition Law

Brought to you by SAnews: The Department of Trade, Industry and Competition (the dtic) has highlighted the role of public interest merger conditions and enterprise development funds in driving economic transformation and localization.

Under Section 12A(3) of the Competition Act, No. 89 of 1998, the Competition Commission and Competition Tribunal are mandated to assess the public interest impact of mergers, including the promotion of a greater spread of ownership by historically disadvantaged persons (HDPs) and the entry or expansion of small and medium enterprises (SMEs) in the economy.

Speaking at a stakeholder engagement in Johannesburg, the dtic’s Chief Director of Transformation and Competition, Takalani Tambani, emphasized that funds like the Kgodiso Development Fund—established as part of the public interest commitments in the PepsiCo-Pioneer Foods merger—serve as models for integrating black-owned farming and SMEs into corporate value chains.

The department’s ongoing strategy to dismantle economic barriers and foster inclusive growth focuses on several key regulatory and policy pillars:

  • Leveraging public interest conditions during merger approvals to secure private sector funding for development.
  • Aggregating enterprise and supplier development (ESD) funds through the Transformation Fund to support small and black-owned enterprises.
  • Supporting the Black Industrialists Programme under the Broad-Based Black Economic Empowerment Act, No. 53 of 2003.
  • Deepening localization to build domestic manufacturing capability in sectors such as agriculture, agro-processing, manufacturing, tourism, and green industries.

According to the dtic, future transformation outcomes will be strictly measured against policy commitments, hectares planted, farmers funded, and the long-term sustainability of supported businesses.

What this means for you, your business, or your clients

  • For yourself: No direct individual obligations; professional impact is channelled through corporate advisory, compliance, and legal counsel roles.
  • For your business: Ensure that corporate transaction advisory practices align merger filings with the dtic’s strict enforcement of Section 12A(3) public interest conditions, particularly regarding ESD commitments and localization.
  • For your clients: Clients planning large-scale mergers or acquisitions must prepare robust, measurable public interest proposals, such as localization plans and supplier development funds, to satisfy regulatory scrutiny and secure transaction approval.

Originally published at https://www.sanews.gov.za/south-africa/dtic-dismantles-barriers-inclusive-growth

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