An analysis of the "national security interest" provision in terms of Section 18A of the Competition Act 89 of 1998

Abstract

This contribution examines the implications of the "national security provision" in terms of section 18A of the Competition Act 89 of 1998 as inserted by section 14 of the Competition Amendment Act 18 of 2018. The effect of section 18A is that it confers upon the President of the Republic of South Africa power to appoint a national security committee whose mandate is to investigate mergers involving a foreign acquiring firm and determine whether such a merger would pose a threat to the "national security interests". The contribution highlights the possible challenges that the insertion of section 18A may precipitate. It argues that while the protection of national security interests is imperative, it is however not the goal of competition policy to regulate broader national security policy. In making the argument, cognisance is taken of the fact that where a gap exists in policy, legislative amendments may be used as stop gap mechanisms. The paper investigates the treatment of national security interests in foreign jurisdictions in a bid to establish whether the provision is in line with international best practice and whether any lessons may be drawn there from.