Parliament, Thursday, 24 July 2025 – The Portfolio Committee on Trade, Industry and Competition has called for greater transparency, fairness, and accountability in mergers and acquisitions (M&A), particularly with regard to imposing public interest conditions in terms of transformation and the inclusion of historically disadvantaged persons (HDPs).
The call follows a briefing to the committee by the Competition Commission today, during which the committee raised long-standing concerns about the nature of M&A transactions and the apparent lack of transformation in their implementation.
Further questions were raised about what proactive measures are in place to ensure sellers utilise fair and non-discriminatory buyer selection processes, and whether the Broad-based Black Economic Empowerment (B-BBEE) Commission and the National Empowerment Fund (NEF) play a formal role in overseeing transformation outcomes during these transactions.
The committee noted with concern that the Competition Commission currently does not play an active role in how buyers are identified in M&A activity, an omission the committee is of the view leaves a vacuum that could severely undermine the objectives of transformation.
To address this, the committee has proposed the following recommendations:
- Enhance transparency in buyer selection to create opportunities for HDPs and new market entrants.
- A lock-in period for HDP partners should be built into the approval conditions to ensure that transformation is sustained and meaningful.
- To clarify the role of the Transformation Fund in financing M&A related transactions to enable HDP participation.
- Strengthen institutional partnerships, including optimising the existing Memorandum of Understanding (MoU) between the Commission and the NEF, and explore similar partnerships with the Public Investment Corporation (PIC) and the Industrial Development Corporation (IDC).
- End the secrecy surrounding HDP partners within approved M&As by publishing this information for public scrutiny within a prescribed timeframe.
- Establish a credible, centralised platform, such as the Central Supplier Database (CSD), possibly housed at the NEF, to enable large companies to identify prospective HDP participants during M&A deals.
- Release the list of HDP companies or individuals, including the details of any loans or financing arrangements used in these transactions, to promote transparency and accountability.
- Recommend that the Minister must draft and publish regulations, in terms of section 78 of the Competition Act, while the Commission can issue guidelines in terms of section 79 of the Act. This would codify a framework for the Commission’s scope to consider the transformation element of M&A transactions.
- Introduce a robust post-transaction monitoring system, integrated with the B-BBEE Commission’s monitoring framework, to track long-term transformation outcomes.
The Chairperson of the Committee, Mr Mzwandile Masina, said: “When we passed the budget yesterday, we strongly emphasised and appreciated the work being done on industrial policy, particularly its focus on building the industries of the future. We also reaffirmed that transformation must remain a central pillar, with a clear focus on control, management, and ownership. We expect the Competition Commission to actively foster this transformation.”
The committee urges the Competition Commission to adopt an activist approach in relation to transformation and inclusion regarding mergers and acquisitions.
ISSUED BY THE PARLIAMENTARY COMMUNICATION SERVICES ON BEHALF OF THE CHAIRPERSON OF THE PORTFOLIO COMMITTEE ON TRADE, INDUSTRY AND COMPETITION MR MZWANDILE MASINA.
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