South African businesses navigating merger applications and compliance frameworks are well-acquainted with the Competition Commission’s rigorous focus on transformation. This mandate is most visible in the merger space, where the Commission routinely requires merging parties to implement employee share ownership programmes (ESOPs) or transactions involving historically disadvantaged persons (HDPs) to promote a greater spread of ownership.

However, two merger decisions recently made available online by the Competition Tribunal is a welcome reminder of the Commission’s pragmatic approach when circumstances allow, acknowledging that "blanket" HDP requirements are not always feasible and an understanding of commercial realities:

• Interim Strategic Steps: In the 2024 merger involving Directors Adventure Trust (acquiring property from Columbia Falls) and the ANB/SNB Trusts (acquiring Saltzman Group retail properties), the Commission acknowledged that ESOPs and HDP transactions are impractical when an acquisition serves as a mere interim step in a broader, long-term strategy.
• Foreign-to-Foreign Transactions: In the 2025 merger between CP Spruce Holdings and The Kidney Care Segment of Baxter International (Vantive), the Commission showed flexibility. It recognised that HDP ownership conditions are not warranted when neither party has a physical presence (subsidiaries, offices, or production) in South Africa and only a fractional portion of global turnover is derived locally.

This departure from a "one-size-fits-all" approach to Section 12A(3)(e) requirements is a positive development for international firms with limited local footprints.

Beyond mergers, transformation is being integrated into enforcement via settlement agreements and consent orders. Following an investigation into cartel conduct involving Wilmar, Willowton Group, and Epic Foods, the resulting settlements include substantial public interest commitments. In addition to standard administrative penalties, which were very low considering the allegations, Wilmar and Willowton have committed a total of nearly R150 million to the public interest, including educational initiatives and school infrastructure, food and grocery donations, procurement from black-owned small and medium businesses (SMEs), and direct foreign investment to enhance local industrial capacity.

The recent trend in Tribunal decisions and consent orders reflects a maturing competition regime. While the Commission’s commitment to transformation remains steadfast, these developments indicate a willingness to balance socio-economic goals with commercial logic. By recognising the limitations of ownership remedies in specific contexts—such as interim holdings or foreign-to-foreign deals—the Commission is fostering a more predictable and practical investment environment. For businesses, the key takeaway is that well-reasoned, case-specific arguments regarding feasibility can successfully mitigate the routine imposition of structural HDP conditions.