Court name
Supreme Court
Case number
SA 41 of 2011
Title

Namibian Competition Commission and Another v Wal-Mart Stores Incorporated (SA 41 of 2011) [2011] NASC 11 (04 November 2011);

Media neutral citation
[2011] NASC 11
Coram
Shivute CJ


















REPORTABLE



CASE NO.: SA 41/2011









IN
SUPREME COURT OF NAMIBIA








In
the matter between




























NAMIBIAN
COMPETITION COMMISSION



FIRST
APPELLANT



MINISTER OF
TRADE AND INDUSTRY



SECOND
APPELLANT



and







WAL-MART
STORES INCORPORATED



RESPONDENT












CORAM:
Shivute CJ, Maritz JA et
O’Regan AJA





Heard
on:
18/10/2011





Delivered
on:
4/11/2011












APPEAL
JUDGMENT












O’REGAN
AJA:









  1. This
    is an appeal against two declaratory orders made by the High Court.
    1
    The first order declared invalid paragraph (a) of Notice 75 of
    2010,
    2
    issued by the Minister of Trade and Industry (the second appellant)
    and the second declared invalid four conditions imposed by the
    Namibian Competition Commission (the first appellant) in its
    approval of a proposed merger between Wal-Mart Stores Incorporated
    (the respondent) and Massmart Holdings Ltd, a South African company
    that has five Namibian subsidiaries.






Factual
Background



  1. Wal-Mart
    Stores Incorporated is a company incorporated in the state of
    Arkansas in the United States of America. It is apparently the
    world’s largest company, in terms of revenue, with annual
    revenue estimated at US$408 billion, larger than the gross domestic
    product of most of the countries in the world. Wal-Mart is in the
    process of purchasing the majority shareholding in Massmart Holdings
    Ltd, a retailer and wholesaler of groceries, liquor and general
    merchandise. Massmart has holdings in several different southern
    African countries and the proposed merger required approval by
    competition regulators in South Africa, Namibia, Tanzania, Malawi,
    Swaziland and Zambia. Approval was obtained from the last four
    national regulators by the end of 2010. The merger will affect five
    Namibian companies, all subsidiaries of Massmart. Two of them are
    dormant. The active three are Game Discount World (Namibia) (Pty)
    Ltd, Windhoek Cash and Carry (Pty) Ltd and CCW Namibia Properties
    (Pty) Ltd. The merger is to be effected by way of a scheme of
    arrangement in terms of section 311 of the South African Companies
    Act, 61 of 1973. The material term of the scheme is that Wal-Mart
    has offered to acquire 51% of Massmart’s ordinary share
    capital.







  1. It
    is common cause between the parties that the merger requires
    approval of the Namibian Competition Commission. Accordingly, on 26
    November 2010, Wal-Mart and Massmart informed the Commission of the
    proposed merger in terms of section 44(1) of the Competition Act, 2
    of 2003 (the Act).
    3
    On 9 February 2011, the Chairperson of the Namibian Competition
    Commission informed Wal-Mart and Massmart that the Commission had
    approved the proposed merger subject to four conditions. The four
    conditions were set out in a notice entitled “Notice of
    Determination by the Commission” in relation to Proposed
    Merger. The conditions were that:







  • the
    merger should allow for local participation in accordance with
    section 2(f) of the Competition Act 2003, in order to promote a
    greater spread of ownership, in particular to increase the ownership
    stakes of historically disadvantaged people;


  • there
    should be no employment losses as a result of the merger;


  • the
    merger should not create harmful effects on competition that may
    give rise to the risk of the market becoming foreclosed to
    competitors, especially small and medium enterprises; and


  • the
    approval of the Minister of Trade and Industry is required in terms
    of section 3(4) of the Foreign Investment Act, 1990 (Act No 27 of
    1990).








[4] In addition to their application
to the Competition Commission for approval of the proposed merger,
Wal-Mart’s legal representatives wrote to the Permanent
Secretary of the Ministry of Trade and Industry on 15 December 2010.
In that letter, they requested confirmation from the Ministry that
the proposed merger transaction between Wal-Mart and Massmart did not
require the approval of the Minister of Trade and Industry in terms
of Notice 75 of 2010.
4
That Notice was issued by the Minister in terms of section 3(4) of
the Foreign Investment Act, 27 of 1990 and provides that “a
foreign national who intends setting up any form of retailing
business of any size in Namibia” must first seek and obtain the
permission of the Minister of Trade and Industry. No reply was
received to this letter but it will be noted that the fourth
condition stipulated by the Competition Commission was a condition
that the Minister’s approval in terms of section 3(4) of the
Foreign Investment Act was required.







  1. Nearly
    a month after receiving the conditional approval of the merger from
    the Competition Commission, Wal-Mart applied to the Minister of
    Trade and Industry on 8 March 2011 to review the Commission’s
    decision in terms of section 49 of the Act.
    5
    Section 49(1) of the Act provides that parties to a merger that
    have received a determination by the Commission in terms of section
    47(7) of the Act may, within 30 days of the date of the
    determination, apply to the Minister to review the Commission’s
    decision. Section 49(2) provides that within 30 days of receiving
    the application for review, the Minister must by notice in the
    Gazette
    give notice of the application for a review and invite interested
    parties to make submissions within the time stipulated in the
    notice. Section 49(3) then provides that the Minister must, within
    four months of the date upon which the application for review was
    made, make a determination of the review by confirming the
    Commission’s decision, or by overturning it, or by amending it
    by ordering restrictions or including conditions.







  1. Wal-Mart
    urged the Minister to amend the Commission’s decision by
    deleting the four conditions attached to the merger approval on the
    grounds that they were vague, unlawful and/or irrational, and
    therefore invalid. They also noted that the conditions had not been
    canvassed with the merging parties before they were imposed and
    asserted that if the merging parties had been given an opportunity
    to respond to the proposed conditions, they would have pointed out
    that the vague terms of the conditions would lead to difficulties
    that should be avoided.







  1. The
    application for review also informed the Minister that, as the South
    African Competition Tribunal was expected to approve the merger by 8
    April 2011 at the latest, the merging parties would have to consider
    further legal remedies in Namibia, if the Minister did not conclude
    the review process by 18 March 2011. The consequence of the merger
    being approved in South Africa, but not yet having been finalized in
    Namibia, would, according to Wal-Mart, preclude the merging parties
    from implementing the transaction, which would “have a variety
    of contractual and other ramifications” according to the
    review application.







  1. On
    11 March 2011, the Permanent Secretary to the Ministry wrote to
    Wal-Mart’s legal practitioners acknowledging receipt of the
    application for review but stating that, given the process
    stipulated in section 49 of the Act, the request that the Minister
    complete the review within ten days was “unreasonable”.
    On 14 March, Wal-Mart’s legal representatives responded to
    this letter and stated that the application for ministerial review
    was (somewhat mysteriously) “not confined to section 49 of
    that Act, which was a reference our office unfortunately by error
    inserted without instructions into our letter”. They
    continued by saying that a decision of the South African authorities
    was expected by 8 April, and that the “matter unfortunately
    cannot await a determination stretching beyond that date”.
    Nevertheless the letter concluded by stating that they persisted in
    the application for review as lodged.







  1. Four
    days later, Wal-Mart instituted these proceedings in the High Court
    on an urgent basis. They sought an order declaring Notice 75 to be
    unauthorized by law and invalid and an order that the four
    conditions attached to the approval of the merger by the Commission
    were also unlawful and invalid. Respondents were given a week to
    lodge answering affidavits, if they opposed the application. The
    Minister and the Commission both opposed the application. In its
    answering affidavit, the Commission indicated that the truncated
    time periods had prevented it from preparing and filing a record of
    its decision and it requested time to complete the record, and if
    necessary lodge a supplementary answering affidavit. This request
    was again repeated at the hearing of the urgent application.
    Wal-Mart opposed the request on the basis that it had not proceeded
    by way of Rule 53, and that, as applicant, it was entitled to waive
    its right to the record. In the event, the High Court proceeded
    without the record of the Commission’s decision.







  1. The
    Commission raised two preliminary points in opposition. It argued
    that Wal-Mart had not established a basis to proceed by way of
    urgency; and it argued that the application was premature as
    Wal-Mart had not exhausted its internal remedies, in particular the
    section 49 review. The Minister raised the same two points, and
    added two others, which were abandoned in the High Court. The first
    of these was non-joinder, on the basis that the five Namibian
    subsidiaries had not been joined in the proceedings. Letters were
    produced in reply from each of the companies indicating they did not
    wish to be joined. The second was a challenge to the authority of
    the deponent who made the founding affidavit but this too was
    addressed in reply. Neither the Commission nor the Minister pleaded
    over on the merits, though they did assert that many of the
    substantive issues raised by the application were legal issues that
    would be addressed in argument.








  1. The application was heard by the High
    Court on 6 April 2011 and judgment was handed down on 28 April.








High Court judgment



  1. The
    High Court granted condonation to the applicant to bring the
    application by way of urgency. In reaching this conclusion, it
    reasoned that if the application had been enrolled in the ordinary
    course, it would not have been heard till the last term of 2011 or
    early 2012, which would have left the status of the merger
    uncertain, once the merger had been approved in South Africa. The
    High Court found that Wal-Mart had not unduly delayed in launching
    the application and that the Minister and Commission had not been
    prejudiced by the expedited proceedings.







  1. The
    High Court then considered whether Wal-Mart had brought the
    application prematurely. The key issue here was whether Wal-Mart
    had been bound to pursue the section 49 ministerial review, prior to
    instituting legal proceedings. The High Court, relying on
    National
    Union of Namibian Workers v Naholo
    ,6
    held that where a statute created an internal remedy, it was a
    matter of statutory interpretation as to whether that remedy had
    first to be exhausted before recourse could be had to a court.
    7
    The mere fact that a statute creates an internal remedy does not
    imply that access to court is prohibited pending the exhaustion of
    that remedy. Tötemeyer AJ in
    Naholo
    identified two criteria relevant to determining whether the remedy
    needed to be exhausted. The first relates to the language of the
    statutory provision, and the second to the time that the internal
    remedy will take to pursue and whether, given the time that it might
    take, it would, in effect, deprive an applicant of a remedy as a
    result of delay.
    8







  1. The
    High Court held that both the criteria identified in
    Naholo
    were of application to this case.
    9
    It held accordingly that section 49 did not require the Wal-Mart to
    exhaust the ministerial review process before approaching the Court
    for relief. It observed that section 49 states that merger parties
    “may make application to the Minister” to review the
    decision of the Commission. This, the High Court reasoned, was
    language that did not suggest the ouster of the jurisdiction of the
    Court. The Judge also noted the time that the review would take (the
    statute sets an upper limit of four months) might deprive Wal-Mart
    of effective relief and observed in this regard that the failure of
    the Minister to institute the review promptly also suggested that
    the review would not be an effective remedy in the circumstances.
    Further considerations that the High Court considered to weigh in
    favour of dismissing the objection that Wal-Mart had not exhausted
    its remedies were the fact that one of the issues that the Minister
    would have to consider would be the validity of Notice 75, a notice
    that the Minister himself had issued
    10
    as well as the fact that most of the issues raised by Wal-Mart were
    legal questions.
    11







  1. The
    Court then considered the merits of the application. It found that
    Notice 75 was invalid on two grounds: first, that in paragraph (a)
    of the Notice, the Minister conferred upon himself the power to
    permit foreign nationals to engage in the retail industry, a
    “dispensing” power that was
    ultra
    vires
    the powers granted
    him by section 3(4) of the Foreign Investment Act; and secondly,
    that the retail industry is not an industry engaged “in the
    provision of services or the production of goods” within the
    meaning of section 3(4) of the Act which are the only industries in
    respect of which the Minister may issue a notice. The Court added
    that, in any event, the proposed merger did not fall within the
    prohibition of Notice 75, as in purchasing the shares in Massmart,
    Wal-Mart did not “become engaged in businesses” within
    the meaning of the prohibition. The High Court also noted that
    because paragraph (a) of Notice 75 was invalid, the fourth condition
    imposed by the Commission was also invalid, in that it required
    Wal-Mart to obtain the permission of the Minister to engage in the
    retail business.







  1. The
    High Court then considered the validity of the other three
    conditions imposed by the Commission. It declared each of them to be
    invalid. It held that the first condition which required the merger
    to “allow for local participation in accordance with section
    2(f) of the Act” was in conflict with section 3(3) of the
    Foreign Investment Act, which provides that no foreign national
    “shall be required to provide for the participation of the
    Government or any Namibian as shareholder or as partner in such
    business, or for the transfer of such business to the Government or
    any Namibian”. The Court held in addition that the condition
    was arbitrary and vague in its formulation. It also noted that
    because the merging parties had not been given notice of the
    Commission’s intention to impose the condition the fairness of
    the procedure followed by the Commission was flawed.







  1. With
    regard to the second condition, that the merger should not result in
    job losses, it held that there was no rational connection between
    the reason given for the condition and the terms of the condition
    and that it was accordingly invalid. With regard to the third
    condition, that the merger should not create harmful effects on
    small and medium enterprises especially, the Court held that the
    condition was gain not rationally related to the reasons given for
    it. The Court also held that the terms of the condition were
    impermissibly vague.


  2. The
    High Court accordingly declared both Notice 75 and the four
    conditions imposed by the Commission in respect of its approval of
    the proposed merger to be invalid. It is against these orders that
    appellants now appeal. One further event needs to be noted. On 9
    June, Wal-Mart successfully applied to the High Court on an urgent
    basis for an order declaring that the noting of the appeal would not
    suspend the operation and execution of the judgment delivered by the
    High Court on 28 April 2011. In addition to granting the relief
    sought by Wal-Mart, the High Court made an adverse costs order
    against the appellants, ordering them to pay the costs of Wal-Mart
    on the scale as between attorney and client.






Proceedings
in this Court: application to augment appeal record



  1. On
    1 June 2011, the Commission and the Minister noted appeals against
    the judgment and orders of the High Court. After the appeals had
    been noted, Wal-Mart undertook to arrange the preparation of the
    appeal record in order to ensure the matter be dealt with
    expeditiously. A pre-appeal hearing with the registrar was held on
    13 July at which both the appellants and the respondent were
    represented. The signed minutes of that meeting disclose that all
    the parties were content with the appeal record that had been
    lodged.







  1. Despite
    that agreement, on 10 October 2011, just over a week before the
    appeals were due to be argued in this Court, the Commission lodged
    an application to supplement the appeal record. It wished to lodge
    the papers filed in the interlocutory application brought by
    Wal-Mart on 9 June for an order that the judgment of the High Court
    would not be suspended, pending this appeal. The Commission also
    sought condonation for the late institution of the application.
    Wal-Mart opposed the application, and lodged both an answering
    affidavit and heads of argument in support of that opposition. Soon
    after the commencement of the appeal hearing on 18 October 2011, the
    Commission’s counsel abandoned the application to augment the
    appeal record, in my view correctly. The only issue that remains
    therefore is the question of costs in this regard. I shall deal with
    that question at the end of this judgment but it should be noted for
    purposes of taxation that the hearing on this issue did not exceed
    half an hour.






Issues
on appeal



  1. There
    were two substantive issues before the High Court: the first
    concerned the validity of Notice 75, and the second concerned the
    validity of the four conditions imposed by the Competition
    Commission. This judgment deals first with the validity of Notice
    75. Before considering the second substantive issue, the validity
    of the conditions imposed by the Commission, this Court must
    consider whether the High Court was correct in determining that
    issue despite the fact that the section 49 review of the
    Commission’s decision had not run its course. Only if this
    Court concludes that the High Court was correct in determining the
    validity of the conditions despite the fact that the review had not
    run its course, will this Court then consider whether the conditions
    imposed by the Court were correctly set aside by the High Court.







  1. It
    should be noted at this stage that the Minister did not lodge either
    written or oral argument on the validity of the conditions. He did
    not do so because, in his view, he is seized with the review under
    section 49 of the Act, which will require a consideration of the
    merits of the conditions. In the view of the Minister, his
    performance of that review function might well be tainted were he to
    have tendered argument on the validity of the conditions in these
    proceedings.







  1. The
    final issue that the Court will have to consider will be the
    appropriate relief, including costs.






Relevant
legal provisions



  1. Section
    2 of the Act provides as follows:








Purpose
of the Act



The
purpose of the Act is to enhance the promotion and safeguarding of
competition in Namibia in order to –



(a)
promote the efficiency, adaptability and development of the Namibian
economy;



(b)
provide consumers with competitive prices and product choices;



(c)
promote employment and advance the social and economic welfare of
Namibians;



(d)
expand opportunities for Namibian participation in world markets
while recognizing the role of foreign competition in Namibia;



(e)
ensuring that small undertakings have an equitable opportunity to
participate in the Namibian economy; and



(f)
promote a greater spread of ownership, in particular to increase
ownership stakes of historically disadvantaged persons.”











  1. Section
    47(2) of the Act provides that:








The
Commission may base its determination of a proposed merger on any
criteria which it considers relevant to the circumstances involved in
the proposed merger, including –



(a)
the extent to which the proposed merger would be likely to prevent
or lessen competition or to restrict trade or the provision of any
service or to endanger the continuity of supplies or services;



(b)
the extent to which the proposed merger would be likely to result in
any undertaking, including an undertaking not involved as a party in
the proposed merger, acquiring a dominant position in a market or
strengthening a dominant position in a market;



(c)
the extent to which the proposed merger would be likely to result in
a benefit to the public which would outweigh any detriment which
would be likely to result from any undertaking, including an
undertaking not involved as a party in the proposed merger, acquiring
a dominant position in a market or strengthening a dominant position
in a market;



(d)
the extent to which the proposed merger would be likely to affect a
particular industrial sector or region;



(e)
the extent to which the proposed merger would be likely to affect
employment;



(f)
the extent to which the proposed merger would be likely to affect the
ability of small undertakings, in particular small undertakings owned
or controlled by historically disadvantaged persons, to gain access
to or to be competitive in any market;



(g)
the extent to which the proposed merger would be likely to affect the
ability of national industries to compete in international markets;



(h)
any benefits likely to be derived from the proposed merger relating
to research and development, technical efficiency, increased
production, efficient distribution of goods or provision of services
and access to markets.”







  1. Section
    49 of the Act reads as follows:




Review
of decisions of Commission on mergers by Minister



(1)
Not later than 30 days after notice is given by the Commission in
the
Gazette
in terms of section 47(7) of the determination made by the Commission
in relation to a proposed merger, a party to the merger may make
application to the Minister, in the form determined by the Minister,
to review the Commission’s decision.



(2)
Within 3 days after receiving an application in terms of subsection
(1), the Minister must by notice in the
Gazette



(a)
give notice of the application for a review; and



(b)
invite interested parties to make submissions to the Minister in
regard to any matter to be reviewed within the time and manner
stipulated in the notice.



(3)
Within 4 months after the date that an application for review was
made, the Minister must make a determination either –



(a)
overturning the decision of the Commission;



(b)
amending the decision of the Commission by ordering restrictions or
including conditions; or



(c)
confirming the decision of the Commission.



(4)
The Minister must –



(a)
give notice of the determination made by the Minister in relation to
the review –



(i) to
the Commission and to the parties involved in the proposed merger, in
writing; and





(ii)
by notice in the
Gazette;
and



(b)
issue written reasons for that determination to the Commission and
the parties involved.



(5)
The Minister may determine the procedure for a review in terms of
this section.”







  1. Section
    3(1) of the Foreign Investment Act, 1990 provides as follows:







Subject
to the provisions of this section and the compliance with any
formalities or requirements prescribed by any law in relation to the
relevant business activity, a foreign national may invest and engage
in any business activity in Namibia, which any Namibian may
undertake.”







And section 3(4) of the same Act
reads:







The
Minister may, by notice in the Gazette specify any business or
category of business which in the Minister’s opinion is engaged
primarily in the provision of services or the production of goods
which can be provided or produced adequately by Namibians and, with
effect from the date of such notice, no foreign national shall,
subject to the provisions of section 7(3), through the investment of
foreign assets become engaged in or be permitted to become engaged in
any business so specified or falling within any category of business
so specified.”





Notice
75



  1. The
    first substantive issue that arises for decision is whether Notice
    75 is invalid. Although the appellants argued that this issue
    should not be dealt with until the ministerial review process under
    section 49 of the Act was complete, this argument cannot be
    sustained for two reasons. First, the validity of Notice 75 is not
    an issue that can be determined by the ministerial review process
    under the Competition Act. The Notice was issued in terms of the
    Foreign Investment Act and its validity is governed by that Act not
    the Competition Act. Although the Commission stipulated that the
    merger parties should obtain permission within the terms of Notice
    75 as a condition of its approval of the merger, the question of its
    validity and application of Notice 75 arises separately from the
    approval of the merger proceedings. Even if the condition stipulated
    by the Commission were to be removed, the question still arises for
    the merger parties whether Notice 75 is valid and of application.
    Moreover, the validity of Notice 75 is a legal issue that only a
    court may determine authoritatively.







  1. Secondly,
    Wal-Mart approached the Minister on 15 December 2010 to ask whether
    the Minister considered Notice 75 to affect the merger transaction,
    but they received no response to this enquiry. If the Minister had
    informed them, at that stage or at any time since, that he did not
    consider Notice 75 to be of application to the merger transaction,
    Wal-Mart would not have needed to seek declaratory relief to
    determine the legal validity of Notice 75. But the Minister did not
    do so. Wal-Mart therefore was entitled in the light of the
    Minister’s failure to respond to their letter of 15 December
    2010 to seek declaratory relief concerning the validity of Notice
    75. The appellants’ argument that Wal-Mart acted prematurely
    in seeking declaratory relief concerning Notice 75 cannot therefore
    be sustained.







  1. The
    High Court found that paragraph (a) of Notice 75 was
    ultra
    vires
    the terms of section
    3(4) of the Foreign Investment Act and invalid for two reasons. The
    first was that the Minister had conferred upon himself the power to
    permit departures from the prohibition he himself had issued,
    although this “dispensing” power was not expressly
    conferred by section 3(4) of the Act. Secondly, the High Court
    found that retail businesses do not fall within the ambit of “the
    provision of services or the production of goods” as specified
    in section 3(4) of the Foreign Investment Act.
    12







  1. It
    seems logical to address the second question first. For, if section
    3(4) does not embrace the retail sector, then the Minister was not
    permitted to issue any notice in relation to the retail sector under
    section 3(4). The question that arises in this regard is whether the
    prohibition contained in paragraph (a) of Notice 75, the only
    paragraph in Notice 75 that is of application in this case, does
    fall within the ambit of section 3(4) of the Foreign Investment Act.
    Section 3(4) empowers the Minister to “specify any business or
    category of business which in the Minister’s opinion, is
    engaged primarily in the provision of services or the production of
    goods” which can be adequately provided by Namibians and to
    declare that from a particular date no foreign national shall become
    engaged in that business.







  1. In
    interpreting section 3(4), it is necessary to consider its statutory
    context. The long title of the Foreign Investment Act is “to
    make provision for the promotion of foreign investments in Namibia”.
    Consistent with the purpose identified in the long title, section
    3(1) of the Act provides that “a foreign national may invest
    and engage in any business activity in Namibia which any Namibian
    may undertake,”
    13
    subject to the other provisions of section 3.








  1. Section
    3(4) thus provides for an exception to the principle in section 3(1)
    that foreign nationals may invest and engage in business in Namibia.
    The scope of the exception contained in section 3(2) relates to
    those businesses engaged “primarily in the provision of
    services or the production of goods”. When section 3(4) refers
    to businesses engaged in “the provision of services or the
    production of goods” does it refer to the retail industry?







  1. The
    retail industry is by definition engaged in the sale of goods to the
    general public. Retailers do not produce goods and so cannot be
    considered to fall within the category of business that is engaged
    in the production of goods. The question is whether retailers
    “provide services” within the meaning of section 3(4).
    The appellants argue that selling goods to the public constitutes
    the provision of a service. They argue, relying on the dictionary
    definition of services, that to provide services is to serve, help
    or benefit others or to supply the needs of others. As selling
    goods to the public benefits the public and supplies its needs,
    retailing is the provision of a service, they argue.







  1. If
    the definition suggested by the appellants were to be accepted, the
    phrase “provision of services” would have a very broad
    import. Arguably every business is aimed at supplying the needs of
    consumers or citizens, which would mean that the Minister has the
    power to prohibit foreign nationals engaging in nearly any category
    of business. Such an outcome does not fit easily with the text and
    context of section 3 for at least three reasons.








  1. First, and most importantly, it is at
    odds with the long title of the Act and with section 3(1) which
    establishes the principle that foreign nationals may invest and
    engage in business in Namibia. Section 3(1) is subject to the
    exception established in section 3(4). But attributing a meaning to
    the “provision of services” in section 3(4) which would
    permit the Minister to prohibit foreign nationals from engaging in
    any business that “supplies the needs of others” would
    have the effect that nearly all businesses might fall within the
    terms of section 3(4) and thus limit, if not destroy, the ambit of
    the principle established in section 3(1).








  1. Secondly, an ample reading of “the
    provision of services” as suggested by the appellants could
    arguably include within its scope “the production of goods,”
    as goods are ordinarily produced to supply the needs of others. Yet,
    it is clear that section 3(4) considers the “provision of
    services” and “the production of goods” to refer
    to two different types of business.








  1. A third difficulty with the
    interpretation proposed by the appellants, arises from the fact that
    the Act qualifies those businesses that may be specified by the
    Minister as those “primarily” engaged in the provision
    of services or the production of goods. The use of the adverb
    “primarily” makes clear that although a business may do
    different things (including the provision of services as a secondary
    or ancillary activity), it is the primary activity of the business
    that must fall within the exemption. If the provision of services
    covered nearly every form of business activity, it would be hard to
    see what ancillary or secondary activities could arise. Moreover,
    as will be discussed in the next paragraph, the primary activity of
    retailers is not the provision of services but rather the sale of
    goods to the public.







  1. A
    narrower meaning for the “provision of services” than
    that proposed by the appellants would thus fit the legislative
    context more neatly. What is that narrower meaning? At common law,
    as counsel for Wal-Mart argued, the legal contract for the sale of
    goods is different to the contract for the performance of services.
    When suing for payment of a purchase price owing in respect of a
    contract of sale (
    emptio),
    one pleads that the money is due as a result of “goods sold”.
    When suing for the remuneration due in respect of a contract of
    services (
    locatio conductio
    operis
    ), one sues for
    “services rendered”. This established legal distinction
    between the sale of goods and the provision of services is clear and
    is also consistent with the framework of the Act.







  1. The
    view that selling goods does not constitute the provision of
    services has been endorsed in another context, the area of trade
    mark protection. In
    Miele
    et Cie GmbH & Co v Euro Electrical (Pty) Ltd,
    the
    South African Appellate Division was concerned with an application
    by Miele to interdict the respondent from using its registered trade
    mark.
    14
    The respondent argued that its use of the Miele trade mark related
    to the provision of services, not goods, and as the trade mark was
    registered only in relation to goods, it was not an infringement of
    Miele’s registered trade mark.
    15
    Corbett JA, rejected this argument as follows:








Repairing is, of course, a
service, but in the context of Euro Electrical’s business it is
merely ancillary to the main activity of selling goods. And, in my
view, it is artificial and incorrect to regard the selling of goods,
even if they all emanate from a single manufacturing source, as the
provision of services.”
16







Although this dictum
relates to a context different to the one under consideration in this
case, it is clear that a distinction is being drawn between the
selling of goods and the provision of services. It is the distinction
that underlies the common law contractual distinction referred to
above and it is a distinction consistent with the language and
purpose of section 3(4) of the Foreign Investments Act.






  1. For
    all the above reasons, it seems to me that the phrase “provision
    of services” in section 3(4) of the Foreign Investment Act
    cannot be interpreted as the appellants suggest to include any
    business that supplies the needs of others, including retail
    businesses. The “provision of services” therefore does
    not include within its scope those businesses that are engaged in
    the business of selling goods as opposed to rendering services.
    Accordingly, paragraph (a) of Notice 75 is
    ultra
    vires
    the terms of its
    empowering section, and the order of invalidity made by the High
    Court in this regard must stand. In the light of this conclusion, it
    is not necessary to consider the other bases upon which Wal-Mart
    argued that Notice 75 was invalid.







  1. The
    second substantive issue is whether the conditions imposed by the
    Commission were invalid. Before considering that issue, it is
    necessary to consider the argument raised by the appellants that it
    is premature for a court to consider this question given that the
    ministerial review contemplated in section 49 of the Act has not run
    its course. It is to this preliminary issue that this judgment now
    turns.






Exhaustion
of internal remedies



  1. Was
    the High Court correct in deciding that Wal-Mart could seek to have
    the conditions imposed by the Commission set aside without first
    letting the ministerial review provided for in section 49, which
    Wal-Mart itself had instituted, run its course? Both appellants
    argued that the High Court erred by permitting Wal-Mart to obtain
    relief before the ministerial review in terms of section 49 had run
    its course. On behalf of Wal-Mart, it was argued that the effect of
    requiring Wal-Mart to exhaust the ministerial review process would
    be to “oust” the jurisdiction of the courts, something
    it is presumed the legislature does not intend to do. Counsel for
    the Minister responded that requiring Wal-Mart to pursue the section
    49 review process before approaching a court would not oust the
    jurisdiction of the Court but merely defer its jurisdiction till the
    review process was complete.







  1. Counsel
    for Wal-Mart argued that section 49 was not an effective remedy to
    it for essentially three reasons: because it was time-consuming,
    because the Minister, especially in relation to the condition
    relating to Notice 75, would be a judge in his own cause, and
    because the Minister had expressed his contempt for Wal-Mart’s
    position in his affidavit that indicated that he was not able to
    approach the matter in a fair way.







  1. Ordinarily,
    the question whether an applicant will be required to exhaust
    internal remedies before approaching a court for relief, turns on
    the interpretation of the relevant statute (or contract, though that
    does not arise in this case). At times, a statute may expressly
    provide that an internal remedy must be exhausted before approaching
    a court. More commonly, though, the statute does not expressly
    insist that an applicant exhaust the internal remedy it provides
    before approaching a court. The question is whether the statute
    implicitly requires exhaustion of the internal remedy. The mere
    fact that a statute has provided an internal remedy is not generally
    sufficient to establish that it intended to insist that the internal
    remedy be exhausted before a court is approached for relief.
    17
    More is required.







  1. In
    National Union of Namibian
    Workers v Naholo
    ,
    Tötemeyer AJ identified two considerations relevant to the
    determination of whether internal remedies should be exhausted. The
    first is the wording of the relevant statutory provision; and the
    second is whether the internal remedy would be sufficient to afford
    practical relief in the circumstances. In
    Naholo’s
    case, Mr Naholo, the Acting General Secretary of the National Union
    of Namibian Workers, had been dismissed by the Union. A clause of
    the Union’s constitution provided that Mr Naholo would have
    the right to appeal to the next national congress of the Union.
    Tötemeyer AJ observed that national congresses only occurred
    every four years and that if Mr Naholo had to wait years to
    prosecute an appeal, he would be ”virtually remediless”.
    18
    This consideration persuaded the Court that the internal remedy
    provided by the Union’s constitution would not provide
    effective relief and therefore did not need to be exhausted before
    Mr Naholo approached the Court.








  1. The requirement that the internal
    remedy provide effective redress is one that has been acknowledged
    by South African courts as well.
    19
    Determining whether an internal remedy provides effective redress
    requires a careful examination of the remedy provided in the statute
    in the light of the relief sought in the litigation. Here, the
    relevant relief sought is a declaration that the four conditions
    imposed by the Commission on its approval of the merger were
    invalid. The nature of this relief will be relevant to determining
    whether Wal-Mart should have exhausted the ministerial review
    process before approaching the High Court.







  1. The
    first question that arises is whether section 49
    expressly
    prevents parties dissatisfied with the decision of the Commission
    from approaching a court in all circumstances, until the ministerial
    review provided for in the section has been exhausted. Section 49
    provides that a party to the merger “may” make
    application to the Minister for a review of the Commission’s
    decision.
    20
    In my view, the language of the section cannot be said
    expressly
    to prohibit access to court for in terms it does not state that no
    party may approach a court for relief until the review has been
    completed. It simply states that the parties may approach the
    Minister for review.







  1. The
    next question that arises is whether section 49 implicitly prohibits
    a party from approaching the court until the review is complete. To
    answer this question, it is necessary to undertake a careful
    analysis of the review procedure and powers set out in the section.
    Section 49 contemplates an important role for the Minister in
    determining whether mergers should be permitted or prohibited. Four
    aspects of the review mechanism are of particular relevance. First,
    there is the fact that it is the Minister of Trade and Industry who
    is responsible for deciding the review. As the member of the
    Cabinet charged with the responsibility of administering and
    executing the functions of government with respect to trade and
    industry,
    21
    which requires him to direct, co-ordinate and supervise the Ministry
    of Trade and Industry,
    22
    the Minister bears great responsibility. Moreover, he is directly
    accountable to the President and Parliament for the performance of
    these duties.
    23
    The review power has thus been entrusted to a democratically
    accountable and senior member of government.







  1. Secondly,
    section 49(2) requires the Minister to publish by notice in the
    Gazette
    the fact of the review and invite interested parties to make
    submissions on the matter. This process provides an important
    opportunity for interested members of the public to make relevant
    submissions to the Minister on the proposed merger. This
    opportunity is all the more important, given that the Commission is
    not compelled to afford interested parties notice of the application
    for merger permission or to provide interested parties with an
    opportunity to submit comments to it.
    24







  1. Thirdly,
    section 49(3) makes plain that the Minister is not only empowered to
    confirm or overturn the decision of the Commission but is also
    empowered to amend the decision of the Commission by ordering
    restrictions or including conditions to the approval of the proposed
    merger. The Minister therefore has extensive powers to alter the
    decision of the Commission in the light of the information he
    receives, which a court reviewing the Commission’s decision
    does not. In making his decision on the proposed merger, the
    Minister, like the Commission will have to take into account the
    considerations set out in section 2 of the Act,
    25
    as well as those set out in section 47(2).
    26







  1. Fourthly,
    the range of considerations set out in both section 2 and section
    47(2) make plain that the decision whether to approve a proposed
    merger involves questions relating to the promotion and safeguarding
    of competition in Namibia, as the title of the Act suggests, but
    also other public interest considerations relating to the promotion
    of employment opportunities, the protection and promotion of small
    and medium-sized enterprises and the expansion of the participation
    of historically disadvantaged people in the Namibian economy. The
    decision is one that requires “an equilibrium to be struck
    between a range of competing interests or considerations.”
    27
    Precisely how these differing goals should be balanced within the
    framework of the Act in relation to each proposed merger is a
    question that both the Commission and the Minister will have to
    address in the exercise of their statutory powers. This is a
    decision that the Act specifically assigns first to the Commission
    and then to the Minister. As the Commission is an institution
    specially constituted to consider competition matters, and the
    Minister bears both constitutional and democratic responsibility for
    trade and industry, these are assignments that should not lightly be
    bypassed.







  1. These
    four factors all suggest that the ministerial review process will
    often provide effective relief, and relief more extensive than that
    which a reviewing court may provide. Accordingly, a court will
    rarely permit a party to approach it for relief before the review
    contemplated in section 49 is completed. The question in each case
    will be whether the review process will provide effective relief.
    Two situations can be mentioned here. The first will arise where the
    nub of the complaint raised goes to the manner in which the balance
    between the competing concerns set out in section 2 and 47(2) of the
    Act has been struck by the Commission. The task of balancing the
    competing interests in the Act is not a task for which a court has
    any special competence. Nor is it one that in the scheme of the Act
    is assigned to a court. It is a task reserved by the legislation
    first for the Commission and then for the Minister. Moreover, the
    Act confers the power upon the Minister to overturn or vary the
    decision of the Commission, a power that will not ordinarily be
    exercised by a court. In the circumstances, where the complaint
    raises the manner in which the considerations mentioned in section 2
    and section 47(7) of the Act have been balanced in the decision, a
    court will require the ministerial review process to be exhausted
    before it will consider an application for relief. Secondly, a
    court will rarely permit a party to approach it for relief where the
    complaint is one that the Minister is empowered to resolve during
    the ministerial review process. The Act affords the Minister ample
    powers to alter the decision taken by the Commission in the light of
    the information placed before the Minister and ordinarily a court
    will require that the review process run its course.







  1. On
    the other hand, if the complaint does not relate to the manner in
    which the balancing exercise has been struck, and is one that the
    ministerial review cannot correct, then it may be an issue that a
    court will entertain before the review process is complete. The
    question in each case will be whether the ministerial review process
    provides effective relief to the litigant.







  1. One
    of the considerations as to whether the ministerial review is an
    effective remedy relates to the time that the ministerial review
    process will take. In this regard, it should be noted that the time
    periods set out in section 49 of the Act are maxima, not minima.
    The Minister must publish notice of the review in the
    Gazette
    within 30 days of
    receiving the review application. He may of course do it in a
    shorter period. Similarly, the Minister must determine the review
    within four months of the application having been lodged, but he may
    determine the review more quickly. Moreover, it is the Minister who
    determines the time limits within which interested parties must
    lodge their comments. These time limits are not set in the Act. In
    determining the appropriate time limit in each case, the Minister
    will take into account the statutory requirement that the review be
    determined within four months of the review application having been
    lodged, but also other considerations, including the question
    whether the relevant merger is one that requires an expeditious
    decision.







  1. I
    turn now to apply these principles to the facts of this case. Is the
    relief sought
    a quo
    in relation to the conditions attached by the Commission to its
    approval of the merger premature, in that Wal-Mart should first have
    exhausted the review process provided for in section 49 of the Act?
    In what follows, I consider the challenges to the first three
    conditions imposed by the Commission. Given the conclusion reached
    above in relation to the validity of Notice 75, it is not necessary
    to consider the fourth condition further.







  1. Wal-Mart
    argued that the first condition, that the merger allow for local
    participation in accordance with section 2(f) of the Act, was
    unlawful on the ground that it was in conflict with section 3(3) of
    the Foreign Investment Act, and also on the grounds that it was
    vague, arbitrary and irrational. Section 3(3) of the Foreign
    Investment Act provides that a foreigner engaged in business
    activities in Namibia, shall not be required “to provide for
    the participation” of the Namibian government or any Namibian
    citizen as a shareholder or partner in such business.
    28
    The Commission responded that section 2(f) of the Act which
    provides that one of the purposes of the Act is “to promote a
    greater spread of ownership, in particular to increase ownership
    stakes of historically disadvantaged persons” authorizes the
    terms of the condition.







  1. Wal-Mart
    challenged the second condition, which required there be no
    employment losses as a result of the merger, on the ground that it
    was irrational and disproportionate. And it challenged the third
    condition, that there be no harmful effects on competition, on the
    basis that it was irrational, vague and
    ultra
    vires
    the powers of the
    Commission.







  1. It
    is clear that these three conditions seek to address one or other of
    the statutory purposes set out in section 2 and section 47. The
    first condition addresses the goal set out in section 2(f) of the
    Act, the second, the goal set out in section 2(c), and the
    considerations identified in section 47(2)(e); and the third, the
    goal in section 2(e) and the considerations in section 47(2)(f).
    Whether the conditions formulated by the Commission promote these
    concerns in a rational and appropriate fashion is a question, in the
    first place, for the Minister. It is for the Minister to decide how
    the competing purposes identified in the Act should best be
    achieved. It may be that there is merit in the claims of Wal-Mart
    that the conditions are not as precisely formulated as they should
    be, or not closely connected to the reasons provided by the
    Commission, but these are matters we need not, and do not, decide in
    this judgment. For even if Wal-Mart is correct in these
    submissions, it does not follow that it is appropriate for Wal-Mart
    to bypass the section 49 procedure where these very issues can be
    considered by the Minister.







  1. To
    permit Wal-Mart to challenge these conditions imposed by the
    Commission when it approved the merger transaction without first
    letting the section 49 review process run its course, would be to
    undermine the statutory scheme that empowers the Minister to review
    the Commission’s decision on the merger. If, once the
    Minister has concluded the review, Wal-Mart considers that any
    conditions that have been stipulated are irrational or vague or
    unlawful, it may then challenge those conditions. It may well be,
    however, that any complaints Wal-Mart has about the imposed
    conditions are resolved during the review process.







  1. Counsel
    for Wal-Mart argued that the time that the review would take means
    that the review would not be an effective remedy, as contemplated in
    Naholo.
    As mentioned in para 31 above, in
    Naholo
    the internal remedy was a review by a national conference which only
    takes place every four years, a very different time frame to that
    provided in section 49. Moreover, the time periods provided in
    section 49 are maximum time periods, which may be shortened by the
    Minister where circumstances require. Wal-Mart originally requested
    the Minister to complete the process within ten days. Given the
    provisions of section 49(2) of the Act, which require the Minister
    to give interested parties an opportunity to comment on the proposed
    merger, ten days was indeed an impractically short period. However,
    it may well be that the Minister could seek to finalise the review
    in a shorter period than the four months set as the limit for the
    review by the Act. The review could be concluded within two months,
    for example. This could be achieved by publication in the
    Gazette
    within two weeks of the
    date of the judgment, followed by a two week period for interested
    parties to comment on the proposed merger. The Minister would then
    have a month within which to prepare his decision and reasons. Given
    the complex considerations at play, as well as the fact that the
    maximum time period for the review is four months, and that it may
    take place more quickly than that, it cannot be said that the time
    period renders the section 49 review process “ineffective”.








  1. It may be as Wal-Mart noted that
    competition authorities in other southern African countries approved
    the merger transaction more quickly than has happened in Namibia and
    South Africa. The fact that other authorities have determined the
    case more quickly does not mean that the Namibian procedure is not
    an effective procedure. As the Competition Act makes plain, mergers
    can have many public policy implications that need to be considered
    prior to their being approved. In addition, there may be a range of
    interested parties who may wish to be heard on the implications of
    the merger. Parties to proposed merger transactions need to accept
    that compliance with national competition processes is required. It
    should be noted that at the time of writing this judgment, the South
    African approval that Wal-Mart expected to be finalized by May 2010,
    has still not finally been obtained.







  1. Wal-Mart’s
    final argument was that, in the light of the Minister’s
    conduct before and during the litigation, they considered that he
    was biased and would not bring an open mind to bear on the proposed
    merger transaction. In making this submission, the respondent relied
    on the decision of this Court in
    Minister
    of Health and Social Services v Lisse

    in which the Court held that it would not remit a decision to a
    Minister for several reasons. The first was that on the record, the
    consideration afforded by the Minister to the decision has been
    biased and arbitrary.
    29
    The other reasons for the non-remittal included the substantial
    prejudice that would be suffered by Dr Lisse.
    30
    In that case, the relevant Minister had refused to issue written
    authorization to Dr Lisse to use the facilities of the Windhoek
    State Hospital for his private patients as required by section 17 of
    the Hospitals and Health Facilities Act, 36 of 1994. The Court was
    of the view that the result of the application was a foregone
    conclusion and that the manner in which Dr Lisse’s application
    had been dealt with was a “travesty of justice”.
    31
    It accordingly refused to remit the matter to the Minister and
    ordered that the authorization be granted.







  1. The
    evidence relied upon by the respondent to support their allegation
    of bias was a passage in the answering affidavit. In that passage,
    the Minister stated that Wal-Mart’s suggestion that it would
    have been impossible to conduct the ministerial review in the 10-day
    period proposed by Wal-Mart. He continued that any “suggestion
    by the applicant to the contrary should be dismissed with the
    contempt it deserves”. We have found earlier in this judgment
    that the 10-day period proposed by Wal-Mart was impracticable. It
    may be that the language of the answering affidavit was more
    emphatic than required, but it is by no means evidence that the
    Minister will approach the review with a closed mind. Wal-Mart also
    pointed to the fact that the Minister had not responded to their
    letter concerning Notice 75 dated 15 December 2010. The letter of
    15 December was addressed to the Permanent Secretary in the
    Ministry, not the Minister. The failure of the Permanent Secretary
    to respond to this letter may well have been unfortunate and
    discourteous. Nevertheless it was not a letter addressed to the
    Minister, and does not establish that the Minister will not approach
    the review with an open mind. The evidence pointed to by the
    respondent to suggest that the Minister was biased is flimsy, at
    best, and goes no way to establishing the assertion of bias. It
    cannot be said that a reasonable person who considered these facts
    would conclude that the Minister would not act impartially in
    deciding the review. The submission relating to the Minister, in
    this regard, must thus be rejected.







  1. At
    this point, I pause to observe that although counsel must have
    considerable latitude in making submissions to the Court on behalf
    of those they represent, when doing so, disparaging statements not
    grounded in the record should be avoided. In this case, in oral
    argument, the suggestion by counsel for the respondent that the
    Commission was, amongst other things, “illiterate”,
    apparently based on grammatical errors in the reasons furnished by
    the Commission for its decision, in our view, may arguably have
    reached the limits of that latitude.







  1. In
    conclusion, the appellants’ argument that Wal-Mart should have
    exhausted the section 49 ministerial review procedure before seeking
    an order that the conditions imposed by the Commission when it
    approved the merger succeeds. The order made by the High Court
    declaring the conditions to be unlawful and invalid will therefore
    be set aside. The ministerial review should therefore proceed.
    Because of the time that this litigation has taken, the time limits
    stipulated in section 40 of the Act have expired, and it will be
    appropriate for this Court to declare that the review will be deemed
    to have been launched on the date that judgment is handed down in
    this matter.






Costs




  1. The appellants have succeeded in
    their appeal against the order of the High Court to a significant
    extent. The High Court’s order declaring invalid the
    conditions imposed by the Commission when it approved the merger
    transaction must be set aside. But the appellants have not
    succeeded in their appeal against the order of invalidity relating
    to Notice 75. At the hearing, counsel for the Minister suggested
    that if this were to be the outcome, a costs order in their favour
    in the proportion 75:25 might be appropriate as it would acknowledge
    that the focus of the litigation has always been the conditions
    imposed by the Commission when it approved the merger transaction.
    Counsel for Wal-Mart did not suggest otherwise in reply. The two
    issues are by and large severable, the only connection between them
    being the fact that the Commission required approval in terms of
    Notice 75 as a condition of its approval of the merger. The net
    effect of the proposed apportionment would require the respondent to
    pay approximately half the appellants’ costs both on appeal
    and
    a quo. I
    consider such a result both reasonable and fair in the
    circumstances.







  1. In
    considering the appropriate costs order, one of the considerations
    aired at the hearing was the fact that Wal-Mart had successfully
    obtained an order from the High Court implementing the order made by
    the High Court pending the appeal.
    32
    This order will, of course, now fall away. It was accompanied by a
    special costs order against the appellants. No appeal has been
    lodged against either the order implementing pending appeal, or the
    costs order attached to it. Indeed, appeals against such orders
    will be entertained only in exceptional circumstances.
    33
    At the hearing, appellants did not seek to have the costs order in
    those proceedings set aside, it is not necessary to consider whether
    this Court would have the jurisdiction to do so. Answering that
    question would require a consideration of both the rules of this
    Court, the empowering legislation and this Court’s inherent
    powers in respect of matters interlocutory to appeals before it.
    Whatever the answer to that question may be, it will be a salutary
    practice, and one in accordance with justice, for the High Court
    when granting applications to implement orders pending appeal,
    either to reserve the costs of such applications for decision by
    this Court, or to order that the costs be costs in the appeal.
    34






Order



  1. Accordingly,
    we make the following order.







1. The appeal succeeds in part and
fails in part.







2. Paragraph 2 of the order made by
the High Court in Case No A 61/2010 on 29 April 2010, declaring
paragraph (a) of Notice 75 of 2010, published in Government Gazette
No 4460 on 29 March 2010 invalid and striking it down, is confirmed.







3. Paragraphs 3 and 4 of the order
made by the High Court in Case No A 61/2010 on 29 April 2010, are set
aside and the following orders are substituted for them:







3. The
relief sought in paragraph 3 of the Notice of Motion for an order
declaring the conditions subject to which the second respondent
approved the proposed merger between the applicant and the fourth
respondent invalid is refused;







4. The
applicant is ordered to pay 50% of the costs of the first and third
respondents, such costs, in relation to each respondent, to include
the costs of one instructing and one instructed counsel.”







4. The respondent’s application
to the second appellant to review the decision of the first appellant
in terms of section 49 of the Competition Act 2003 shall, for the
purposes of the time limits stipulated in that section, be deemed to
have been lodged on the date of this judgment.







5. Subject to paragraph 6 below, the
respondent is ordered to pay 50% of the costs of the first and second
appellants on appeal, which include the costs, in relation to each
appellant, of two instructed and one instructing counsel.







6. The first appellant is ordered to
pay the respondent’s costs of opposition to its application to
augment the appeal record in this Court, such costs to include the
costs of one instructing and two instructed counsel.











________________



O’ REGAN AJA















I agree.















_______________



SHIVUTE CJ







I agree.















_______________



MARITZ JA






















































Counsel
on behalf of the 1
st
Appellant:



Mr.
A. Rafik Bhana SC



Assisted
by:



Mr.
J.J. Meiring



Instructed
by:



Hengari,
Kangueehi & Kavendjii











Counsel
on behalf of the 2
nd
Appellant:



Mr.
G. Budlender SC



Assisted
by:



Mr.
J. Brickhill



Instructed
by:



Government
Attorney











Counsel
on behalf of the Respondent:



Mr.
J.J. Gauntlett SC



Assisted
by:



Mr.
F.B. Pelser



Instructed
by:



Engling,
Stritter & Partners








1
See
Wal-Mart
Stores Incorporated v Chairperson of the Namibian Competition
Commission and Others
,
case no A61/2011, judgment of the High Court, dated 28 April 2011
(per Muller and Smuts JJ).




2
Notice 75 of 2010 was issued on 29 March 2010 in terms of section
3(4) of the Foreign Investments Act, 27 of 1990 and published in
Government Gazette No 4460 of 15 April 2010.




3
Section 44(1) provides: “Where a merger is proposed each of
the undertakings involved must notify the Commission of the proposal
in the prescribed manner.”




4
See full citation at note 2 above.




5
The full text of s 49 is set out at para 26 below.




6
2006 (2) NR 659 at paras 50 – 62.




7
High Court judgment at para 32.




8
See
Naholo,
cited above n 6, at para 61.




9
See High Court judgment at para 35.




10
Id at para 36.




11
Id at para 37.




12
Section 3(4) is set out at para 27 above.




13
The full text of
section 3(1) of the Foreign Investment Act is set out at para 27
above
.




14
1988 (2) SA 583 (A); followed in
Tool
Wholesale Holding (Pty) Ltd v Action Bolt (Pty) Ltd
1991
(2) SA 80 (A)




15
This litigation took place under the old South African Trade Marks
Act, 62 of 1963, which has now been replaced by the Trade Marks Act,
194 of 1993.




16
Id at 599 F.




17
See
National
Union of Namibian Workers v Naholo,
cited
above n6, at paras 59 - 60. On this point, the Court cited with
approval the decisions of the South African Appellate Division in
Welkom
Village Management Board v Leteno

1958 (1) SA 490 (A ) at 503 C – D and
Nichol
v Registrar of Pension Funds
2008
(1) SA 383 (A) at para 15.




18
Id at para 61.




19
See, for example,
Nichol
and Another v Registrar of Pension Funds and Others,
cited
above n 17, at para 18; the discussion in Baxter
Administrative
Law
(1984:
Juta) 721 and the references cited there; and the discussion in
Hoexter
Administrative
Law in South Africa
(Juta:
2007) at 478 - 482.




20
The full text of section 49 is set out at para 26 above.




21
See Article 35(1) of the Constitution.




22
See Article 40(a) of the Constitution.




23
Article 41 of the Constitution.




24
Section 46 of the Act does empower the Commission to hold a
conference in relation to the proposed merger if the Commission
considers it appropriate but it does not provide that members of the
public must be informed of the conference or given an opportunity to
participate. Section 47(3) of the Act also permits the Commission
to appoint an inspector to investigate the proposed merger and to
report to it. Finally, section 47(6) provides that any person may
voluntarily submit a statement or other relevant information to the
inspector of the Commission in respect of a proposed merger.




25
The terms of section 2 are set out at para 24 above.




26
The terms of section 47(2) are set out at para 25 above.




27
See
Bato
Star Fishing (Pty) Ltd v Minister of Environmental Affairs and
Tourism and Others
2004
(4) SA 490 (CC) at para 48.




28
The relevant portion of section 3(3) provides that: “No
foreign national engaged in a business activity or intending to
commence a business activity in Namibia shall be required to provide
for the participation of the Government or any Namibian as
shareholder or as partner in such business, or for the transfer of
such business to the Government or to any Namibian …”.




29
2006 (2) NR 739 (SC) at paras 30 - 32. See also the following
South African authority referred to with approval in
Lisse’s
case:
Erf
167 Orchards CC v Greater Johannesburg Metropolitan Council
1999
(1) SA 104 (SCA) at 109 F – G;
Airoadexpress
(Pty) Ltd v Chairman, Local Road Transportation Board, Durban and
Others
1986
(2) SA 663 (A) at 680 E – F.




30
Id. At para 31.




31
Id.




32
The circumstances of this application were described at para 18
above.




33
See the decision of the South African Constitutional Court,
Minister
of Health and Others v Treatment Action Campaign and Others (No 1)
2002
(5) SA 703 (CC) at para 12.




34
See, for an approach consistent with that suggested here, the South
African decision of
N
and Others v Government of the Republic of South Africa and Others
(No 3)
2006
(6) SA 575 (D) at para 15.