1. Presentation to the Portfolio Committee on Economic Development
STRATEGIC PLAN
Presentation to the Portfolio Committee on Economic Development
05 May 2015

2. Introduction The Commission has developed:
A new, 15-year Vision and Mission which takes into account SA’s socio-economic context.
A new Strategic Plan for , which serves a 5 year milestone towards the vision.
An Annual Performance Plan, to realise the strategy.
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

3. National Policy Context
The Strategy is responsive to the national policy context:
THE NATIONAL DEVELOPMENT PLAN (NDP)
South Africa’s long-term vision;
Rallies for the elimination of poverty and reduction of inequality by 2030;
Calls for a social pact for economic growth and job-creation.
THE NEW GROWTH PATH (NGP)
Identifies areas where employment creation is possible, both within economic sectors as conventionally defined and in cross-cutting activities;
Analyses the policies and institutional frameworks required to take advantage of these opportunities, including competition policy.
THE INDUSTRIAL POLICY ACTION PLAN (IPAP)
Advances growth through manufacturing development;
Promotes and targets strategic sectors which are labour-absorbing and can be beneficiated in order to harness or build competitiveness;
Multi-pronged instrument approach: trade policy; local procurement, competition policy, development finance etc.
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

4. The NGP: Competition policy as an economic driver
The New Growth Path identifies measures for competition policy as an economic driver:
Investigations should continue focus on strategic sectors i.e. food, construction/infrastructure, IPAP sectors etc.
Law-enforcement agencies to cooperate more actively with competition authorities to address comp. law breaches.
The competition authorities to review their procedures to reduce the opportunity for vexatious litigation and speed up competition probes.
More consideration to mandating public interest conditions on proposed mergers.
Competition authorities should involve trade unions more and unions should develop their capacity to share information and insights on employment issues in mergers and acquisitions.
Government to amend the Competition Act to enhance the Tribunal’s power to order divestiture where inherited market power permits repeated abuse and to provide mechanisms to address pricing in markets characterised by economic concentration.
The competition authorities and DFIs to identify instances where support for new market entrants is needed to secure more competitive outcomes, in order to combine competition and investment measures.
Government will develop guidelines for granting exemptions for producers to cooperate where it will demonstrably benefit job creation and expansion into export markets.
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

5. “A Growing and Inclusive Economy”
Vision 2030
“A Growing and Inclusive Economy”
Defines the Commission’s role in the transformation of the South African economy;
Places new emphasis on the developmental role of competition in the economy;
Focus on CC contribution to both “growth” and “inclusiveness” of the economy.
Our Mission is: To Undertake Competition Regulation for a Growing and Inclusive Economy.
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

6. Strategy Impact Areas Our Strategy is a contribution to:
ECONOMIC DEVELOPMENT: To promote the efficiency, adaptability and development of the economy;
FAIR PRICES: To provide consumers with competitive prices and product choices;
JOB-CREATION: To promote employment and advance the social and economic welfare of South Africans;
EXPORT PROMOTION: To expand opportunities for South African participation in world markets and recognise the role of foreign competition in the Republic;
SME PROMOTION: To ensure that small and medium-sized enterprises have an equitable opportunity to participate in the economy;
INCREASED OWNERSHIP BY HDI’S: To promote a greater spread of ownership, in particular to increase the ownership stakes of historically disadvantaged persons.
(As per s.2 of the Competition Act.)
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

7. Goal 1: “Effective Competition Enforcement and Merger Regulation”
The Strategic Goals (1/3)
Goal 1: “Effective Competition Enforcement and Merger Regulation”
The CC effectively uses tools such as merger control and enforcement to achieve efficiency gains, as well as the developmental objectives set out in the Competition Act.
Goal Outcomes:
Efficient and effective merger regulation.
Competitive markets through action against cartels and abuse of dominance.
Improved public interest outcomes in markets (relating to jobs, industrialisation, exports, development of black-owned businesses and SMMEs.
Increased competition compliance.
Improved understanding of market dynamics in priority sectors.
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

8. Goal 2: “Strategic Collaboration and Advocacy”
The Strategic Goals (2/3)
Goal 2: “Strategic Collaboration and Advocacy”
The CC emphasises the building of partnerships and collaborations with other economic role-players and actors in order to attain inclusive growth.
This is in the recognition that the resolution of most economic problems often requires more than one form of intervention.
Goal Outcomes:
Improved co-ordination on the application of economic policy and competition policy.
Recognition of developmental perspectives in domestic and international competition law discourse.
Improved compliance and awareness.
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

9. Goal 3: “A High- Performance Agency”
The Strategic Goals (3/3)
Goal 3: “A High- Performance Agency”
The CC successfully delivers on its objectives through a cohesive, well-structured organisation in which people, processes and systems perform optimally.
Goal Outcomes:
Improved organisational efficiency.
Accountably managed resources.
Highly motivated and productive people.
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

10. OUTCOME 4: “Decent employment through inclusive growth”
Alignment with MTSF Outcome 4
OUTCOME 4: “Decent employment through inclusive growth”
The CC’s strategic focus is on addressing abuse of dominance, especially in manufacturing input products, so as to allow for growth to be realised in downstream industries. The manufacturing downstream industries have been identified in the NGP and IPAP as high-potential job drivers.
By addressing abuse of dominance in the economy, more players can compete. Further, through effective merger control, there is also mitigation against greater concentration of ownership, thus allowing for more players to participate in the economy. More economic participants allows for shared (inclusive) growth.
The CC’s strategic focus is also on dismantling cartels in order to level the economic playing field and to reduce barriers to entry. This allows for new players, including SMEs to enter markets, and thus jobs can be created.
The CC also imposes conditions on mergers to limit job-losses and encourages firms to consider alternatives to retrenchments, including encouraging the re-training of staff. The CC empowers Trade Unions and other role-players to effectively participate in merger transactions through training initiatives.
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

11. Alignment with MTSF Outcome 6
OUTCOME 6: “An efficient, competitive and responsive economic infrastructure network”
The dismantling of cartels means that firms can pursue innovation and production efficiencies thus enabling them to expand (jobs) to new markets (exports). This creates a strong economic infrastructure. Through the effective use of exemption provisions, the CC can also unlock industry potential to generate exports, thereby creating competitiveness.
The CC’s addressing of price-fixing in markets allows for wider consumer-choice and also removes artificial inflationary pressures on the economy. These price efficiency gains translate to economic efficiency.
The CC’s new strategy continues its enforcement and prosecution of firms in strategic (priority) economic sectors, including Telecoms, Banking, Intermediate Industrial Inputs and Infrastructure Services. It also carries out economic studies to scope for further anti-competitive conduct in these markets.
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

12. The Annual Performance Plan
34 APP targets have been developed. The key outputs for which targets have been set are summarised as follows:
Investigate abuse-of-dominance, cartels and restrictive cases in priority sectors.
Increase prosecution rate for competition enforcement.
Ensure efficiency in merger control and compliance of merger conditions.
Determine appropriate priority sectors.
Initiate and complete Market Inquiries.
Pursue partnerships and collaborations with other agencies and role-players on economic policy.
Support law enforcement agencies in the criminal prosecution of cartelists.
Undertake education and outreach initiatives to the general public and other stakeholders.
Build and consolidate relationships with BRICS and African partners.
Improve organisational efficiency through appropriate operational mechanisms.
Develop an integrated Knowledge Management and IT System.
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

13. Operational Plans Priority Sectors: annual revision.
Scoping Studies and Impact Assessments: ongoing.
Human Resources:
Organisational Structure: design of organogram, job grading and job descriptions.
Performance Management System (PMS): design of a new and aligned PMS.
Organisational Culture: assessment of org. culture, determination of values, design of relevant solutions.
Knowledge Management and Information Technology
Revision of the Knowledge Management System and re-development of the underlying technological design.
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control

14. Budget The strategy is underpinned by a Budget and MTEF estimates .
Table 1: Expenditure Estimates by Programme
Table 2: Expenditure per economic classification
Mandate
Prosecution of anti-competitive conducts
Prevent concentration through merger control
Expenditure per division
2013/14
2014/15
2015/16
2016/17
2017/18
 R’000
Actual
Budget
Forecast
Administration
70 632
96 505
77 099
Mergers and acquisitions
15 480
19 989
19 004
20 289
21 303
Enforcements and exemptions
20 325
22 680
31 297
31 722
33 902
Cartel
17 918
24 283
23 994
25 682
26 965
Policy and research
37 260
34 483
36 420
37 554
39 431
Legal services
37 310
46 229
48 746
50 067
52 570
Private healthcare market Inquiry -
47 690
46 580 –
Total Expenses
Expenditure per division
2013/14
2014/15
2015/16
2016/17
2017/18
  R’000
Actual
Budget
Forecast
HR Costs
Operational Costs
79 600
Total Expenditure

15. THANK YOU Tel: 012 – 394 3200/ 3580 Fax: 012 – 394 0166/4580
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