Competition Act, 1998 (Act No. 89 of 1998)RegulationsBlock Exemption Regulations for Small, Micro and Medium-Sized Businesses, 20247 - 8. Legal framework |
| 7. | The legal framework for assessing horizontal agreements between firms is section 4(1) of the Act, which states as follows: |
| "4. | Restrictive horizontal practices prohibited |
| (1) | An agreement between, or concerted practice by, firms, or a decision by an association of firms, is prohibited if it is between parties in a horizontal relationship and if— |
| (a) | It has the effect of substantially preventing, or lessening, competition in a market, unless a party to the agreement, concerted practice, or decision can prove that any technological efficiency or other pro-competitive gain resulting from it outweighs that effect; or |
| (b) | it involves any of the following restrictive horizontal practices: |
| (i) | directly or indirectly fixing a purchase or selling price or any other trading condition; |
| (ii) | dividing markets by allocating market shares, customers, suppliers, territories, or specific types of goods or services; or |
| (iii) | collusive tendering." |
| 8. | The legal framework for assessing vertical agreements between firms is section 5(1) of the Act, which states as follows: |
| "5. | Restrictive vertical practices prohibited |
| (1) | An agreement between parties in a vertical relationship is prohibited if it has the effect of substantially preventing or lessening competition in a market, unless a party to the agreement can prove that any technological, efficiency or other pro-competitive, gain resulting from that agreement outweighs that effect." |