Loading...

Retailers lose bid to delay Massmart exclusivity complaint

Sep 05 2016 06:50

(iStock)

Company Data

SHOPRITE HOLDINGS LIMITED [JSE:SHP]

Last traded 216
Change 1
% Change 0
Cumulative volume 1012996
Market cap 0

Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA

MASSMART HOLDINGS LIMITED [JSE:MSM]

Last traded 111
Change 0
% Change 0
Cumulative volume 79710
Market cap 0

Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA

THE SPAR GROUP LIMITED [JSE:SPP]

Last traded 194
Change 1
% Change 1
Cumulative volume 101978
Market cap 0

Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA

Related Articles

Massmart profit rises as food sales grow

Massmart caves in to Shoprite for now

Shoprite vs Massmart

Massmart to open 13 new stores in 2016 despite tough conditions

INFOGRAPHIC: How renewable friendly are SA’s top 5 retailers?

Shoprite takes on Walmart

 

Cape Town - The Competition Tribunal announced on Friday that it has rejected the bid of a group of retailers to delay a hearing into an application brought by Massmart [JSE:MSM] objecting to exclusivity in lease agreements concerning its Game stores.

The local unit of Wal-Mart Stores wants to enter the fresh grocery products market through its Game store chain, but is unable to do so because of these agreements between grocers Shoprite [JSE:SHP], Pick n Pay [JSE:PIK], Spar [JSE:SPP] and shopping mall landlords.

The exclusive leases prevent another chain from selling fresh grocery products and can last anywhere from five to 20 years, according to Massmart, known for its Makro chain of wholesale stores. "The company is of the opinion that exclusive lease agreements are intuitively anti-competitive and prevent it from developing an offering that can compete effectively with the entrenched, national retail chains," Massmart previously said in a statement.

Massmart launched a complaint with the Competition Commission on October 31 2014 against the group of retailers about the exclusivity agreements. In November that same year, the commission said it would  incorporate the complaint with other similar complaints that were then being investigated, and conduct more investigations.

The Competition Tribunal ruled on Friday that Massmart had a right to bring its case to the tribunal, but said it has to give more substance to its case against the three retailers. It said Massmart needs to provide greater clarity about the type of market in question and the consequence of the anticompetitive effects. The tribunal gave Massmart 40 business days from September 1 do this.

Massmart lodged the case with the tribunal after the Competition Commission later rejected its complaint, on the grounds that it is conducting a market inquiry into the grocery sector. Massmart argues, among other things, that this inquiry will focus more on small and independent retailers in townships, peri-urban and rural areas rather than a big chain store such as itself.

Read Fin24's top stories trending on Twitter:

Follow Fin24 on Twitter, Facebook, Google+ and Pinterest. 24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

NEXT ON FIN24X

 
 
 
 

Company Snapshot

#SAVINGSMONTH

Five of SA's top financial brains, including SARB governor Lesetja Kganyago share their best savings habits.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

I am not in a position to save because:

Previous results · Suggest a vote

Loading...