Nedbank has agreed to pay a fine of R2 million for implementing a transaction before obtaining the approval from the competition authorities, the Competition Tribunal said last week.
In a statement, the authority said a consent agreement had been reached between the Competition Commission, Nedbank and Erf 7 Sandown (Pty) Ltd, which owns Sandown Village Office Park, about 17 300 square metres of A-grade office space in Sandton.
In terms of a consent order confirmed by the tribunal, Nedbank and Erf 7 accepted that they were jointly and severally liable to pay an administrative penalty. Nedbank will pay the penalty of R2m, while Erf 7 will be absolved.
The tribunal said an investigation by the Competition Commission found that Nedbank, through Nedbank Property Partners, a division of Nedbank Corporate and Investment Banking, acquired the remaining shares in Erf 7 when exercising its security rights in a risk mitigation transaction.
“After Nedbank exercised its security interest, it acquired sole control of Erf 7 effectively from 24 August 2017. The commission found that this transaction constituted a merger and was notifiable in terms of section 13A of the Competition Act; and that Nedbank and Erf 7 implemented this transaction without prior approval and therefore contravened section 13A(3) of the Act.
“On 5 August 2021, Nedbank and Erf 7 filed the transaction with the commission. In the merger filing, they acknowledged that the transaction was a notifiable large merger and that their conduct of implementing the merger without the required prior approval was an unintentional contravention of the Act,” the tribunal said.
“Following the voluntary disclosure made by Nedbank and Erf 7, the commission assessed the large merger and recommended to the tribunal that the transaction be unconditionally approved. The tribunal approved the large merger without conditions.”
In terms of the order, Nedbank and Erf 7 have also undertaken to:
- Notify the commission of any future transactions that constitute a notifiable merger;
- Refrain from engaging in prior implementation of notifiable mergers in contravention of the Competition Act;
- Update their corporate governance by enhancing Nedbank’s competition law compliance programmes to ensure that its employees, management and executive directors do not engage in future contraventions of the Act; and
- Submit a copy of their competition law compliance programme to the commission.
a fine of R2M in relative to Income earned , is a drop in the ocean
the Banks Officials should be prosecuted,
if they are members of Professional bodies, they should be reprimanded