THE COMPETITION APPEAL COURT OF SOUTH AFRICA
JUDGMENT
Reportable
CASE NO: 260/CAC/Nov2024
26261/CAC/Nov2024
In the matter between:
VODACOM (PROPRIETARY) LIMITED FirstAppellant
BUSINESS VENTURE INVESTMENTS NO 2213
(PROPRIETARY) LIMITED SecondAppellant
THIE MINISTER OF TRADE, INDUSTRY AND
COMPETITION Third Appellant
andnd
THE COMPETITION COMMISSIONOF
SOUTH AFRICA Respondent
Coram: Manoim JP, Nuku JA and Davis AJA
Heard: 22 July 2025
Delivered:
14 August 2025
2
ORDER
Onappealfrom:TheCompetitionTribunal:
1. The Tribunal’s order prohibiting the merger is set aside and replace with the
followingorder:
a) The merger is approved subject to conditions which are attached to
thisJudgment.
2. Thereisnoorderastocosts.
3
JUDGMENT
DavisAJA(ManoimJPandNukuJAconcurring)
Introduction
[1] The controlofmergersasprovided in theCompetitionAct 89 of 1998 (theAct)
hasawidespreadimpactoninvestment,bothlocalandforeignandthusoneconomic
growth. In an analysis of the approach to merger control over the past twenty-five
years,ProfessorWillemBoshoffhasfoundanoticeableincreaseininterventionismin
merger control which is reflected in the growing proportion of mergers that are
approved subject to conditions or are visited with outright prohibitions. While an
application for approval of a merger may not be considered to be inherently urgent,
many mergers do have time constraints. Accordingly, the increased level of
interventiondocumentedbyProfessorBoshoffcanresultinavery lengthyprocessof
litigationculminatinginthecreation ofanadverse investmentclimate.1
[2] The present case is illustrative. In November 2021, first appellant announced
its plan to acquire a 30 % stake in Maziv (Pty) Ltd (Maziv), an entity designed to
consolidate all fibre assets owned by Community Investment Venture Holdings (Pty)
Ltd(‘CIVH’).
[3] After an intensive investigation, in August 2023 the respondent (the
Commission) recommended the prohibition of the merger. During 2024 the
Competition Tribunal (the Tribunal) heard evidence for some 26 days and on 29
October2024itprohibitedthemerger.
[4] Somesixmonthslater,on 28March2025,theTribunalpublished anextensive
setofreasonsdetailing itsjustificationsfortheprohibitionofthemerger.Thedecision
to prohibit the proposed mergerwasthen appealed to this Court both by the first and
1 See Willem H Boshoff Competition Policy in South Africa from 1994 to now: Two competing
approaches in SouthAfrican competition policy;merger control and anti-cartelenforcement over three
decades. EconomicResearchSouthAfricanPolicyPaper(14May2025)
4
second appellants (the merging parties) and by the third appellant (the Minister of
Trade,IndustryandCompetition).
[5] Comprehensive heads of argument in justification of these appeals were filed
by the merging parties and by the Minister. Before the date in terms of which the
Commissionwasobligedtofileitsheadsofargument,itsoughtanextensionfromthe
Judge President. Thereafter a further letter on 4 July 2025 was generated in which it
informed the Court that there were discussions taking place between the merging
parties,the Commission and the Departmentof Trade, Industry and Competition and
thatthefilingoftheheadswouldtakeplace on7 July2025.
[6] Aswasfairlyclearfromthislattercorrespondence,thepartieshadenteredinto
discussionswith regard to revised conditions, asa result of which on 8 July2025 the
Commissionabandoneditsoppositiontotheappeals,whichhadbeenbroughtagainst
thedecisionoftheTribunal.
[7] ThismeantthatwhenthehearingbeforethisCourttookplaceon22July2025,
the Court was faced with the anomalous situation of comprehensive heads of
argument having been filed both by the merging parties and by the Minister to the
effect that the Tribunal’s decision should be set aside, and silence from the
Commission. Both the merging parties and the Minister submitted that the proposed
merger should be approved subject either to the reinstatement of the original
conditions,whichhadbeenrejectedbytheTribunal,orbytherevisedconditionswhich
had been agreed between the parties pursuant to their negotiations which had led to
thedecisionoftheCommission toabandon itsoppositiontotheappeal.
[8] This presented this Court with a considerable difficulty. If the Court was to set
aside theentiretyoftheTribunal’sdecision,in particularthe justification foritsfinding
that there was a substantial preventing or lessening of competition (SLC) as a result
of the proposed merger, it would have to do so without the benefit of any argument
being presented in opposition by the Commission which filed no heads of argument.
being presented in opposition by the Commission which filed no heads of argument.
The Commission,atthe requestofthe Court, filedanimportantnotewhichexplained
whyinitsviewthe revisedconditionsremediedtheharmstheTribunalhad identified.
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[9] Within this context, the Court was confronted with a series of possibilities; in
particular to set aside the SLC findings of the Tribunal on the basis of the arguments
presented by the merging parties and the Minister and then proceed to deal with the
conditionsincludingtheamendedconditionsinthattheabandonmentoftheopposition
totheappealbytheCommissioncouldbetakentoleadtotheinferencethatithadno
casetoofferinoppositiontosuchanapproach.Thealternative,whichistheapproach
which I intend to adopt is, subject to some pertinent observations about the
inadequacy of the Tribunal’s reasoning, to leave the SLC findings intact and then to
evaluate whether the revised conditions which have now been agreed between the
partiessufficetojustifytheapprovalofthemerger.Inotherwords,theCourtisrequired
to examine whether these conditions are of such a weight that they gainsay any
adverse competition finding as set outby theTribunal in its determination of the SLC
test.
[10] In my view, this is the more prudent course of action in that it is always
dangerous to evaluate detailed findings, in the case of the Tribunal, where the Court
does not have the benefit of competing arguments which would allow it to come to a
carefullyreasoneddecisionastowhycertainfindingsshouldbesetaside.Accordingly,
the approach which is adopted in this judgment is to accept the essential findings of
theTribunal with regard to the issue of SLC as it appliesto the proposed mergerand
then to evaluate whether the amended conditions suffice to justify a finding by this
Courtthat themergershouldbeapprovedsubjecttotheseconditions.
ThecoreoftheTribunal’sfindings
[11] The transaction which was the subject of such detailed litigation before the
TribunalconcernedMaziv,aholdingcompanywithtwosubsidiaries.DarkFibreAfrica
(Pty) Ltd (DFA’ and Vumatel (Pty) Ltd (‘Vumatel’). DFA is a network operator which
operates fixed line telecommunication infrastructure, and which provides wholesale
operates fixed line telecommunication infrastructure, and which provides wholesale
fibre mainlyatthenational long distance and metro levels of thevalue chain but also
in some last mile wholesale markets. Its primary activity is the deployment of metro
fibrenetworksandwholesaleaccesstothisinfrastructuretofixedandmobilenetwork
operators and service providers. Vumatel (Pty) Ltd (Vumatel) is a fixed network
operator (FNO) providing open access wholesale fibre connecting homes and
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businessesatthelastmilelevelofthevaluechain.Mazivisawhollyownedsubsidiary
of CIVHwhich, inturn,iscontrolledbyRemgro Ltd.
[12] Vodacom is the largest mobile network operator(MNO) in SouthAfrica, active
in the provision of mobile wholesale and retailvoice, messagingand data servicesto
residentialandbusinesscustomers.TheCommissionfoundthatVodacomwasactive
at all levels of the telecommunications value chain. It builds, acquires and leases
infrastructureandsellsservicesusingthat infrastructure.
[13] Vodacom also has limited FNO as well as certain internet service provider
operations. It is a wholesale customer of DFA for metro backhaul, for fibre to site
(FTTS), which is an access network structure in which the optical fibre network runs
from the aggregation point to a base station as well as fibre to the home (FTTH), an
accessnetwork(orlastmile)structureinwhichtheopticalfibrenetworkrunsfromthe
aggregation point to customer homes ordinarily on a gigabyte passive optic network
(GPON).
[14] Its internet service provider business is a wholesale customer of Vumatel for
accessto FTTH.Atpresent, that ispriortothe proposed merger,Vodacomownsand
operates fibre links at the metro level, which were self-built to connect its own
installationstosharedaggregationpointsandfibreconnectiontobusiness.Italsohas
asmallsetof openaccessFTTHnetworks,mainlyinresidentialareas.
[15] Intermsofthenegotiationsbetweenthemergingparties,Vodacomistoacquire
aminoritystakeinMaziv,beinganinitialacquisitionof30%ofthesharesinMazivwith
an option to increase its stake to 40%. The consideration for the initial 30% was
approximatelyR14billion,madeupofR10billionincashandR4billioninfibreassets.
An additionalR4 billion wouldbe payable incash,if Vodacomexercised its option to
increaseitsshareholding.
[16] In respect of the R4 b in fibre assets, that is the transfer of assets which are
part of the proposed transaction, these constitute all of Vodacom’s fibre assets at the
part of the proposed transaction, these constitute all of Vodacom’s fibre assets at the
metro FTTS and FTTH level. In the result, if the merger is implemented, Vodacom
wouldnolongerbeanFNObecauseitwouldnolongerownandoperateitsownmetro
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FTTSandFTTHfibreinfrastructure.Itwouldhowevercontinuetooperateasamobile
network operator and as a retail internet service provider in the FTTH and FTTS
marketsusingthefibresuppliedbyspecialistFMO’s.
[17] As noted by counsel for the merging parties, ordinarily a minority stake of
between30%to40%ofthesharesofthetargetcompanywouldnottriggerthemerger
notification provisions as required in terms of theAct, where another shareholder, in
thiscaseCIVHandultimatelyRemgro,ownsthebalanceoftheshares.
[18] However,inthiscase,Vodacomhadnegotiatedforcertainminorityprotections
additional to those automatically available to minorities under the CompaniesAct 71
of 2008.
[19] Hence,whileCIVHwillremainthemajoritycontrollingshareholderandcontinue
to exercise positive shareholder control overMaziv, Vodacom, albeit being a minority
shareholder, would acquire certain elements of what was referred to as negative
control. In summary, the Memorandum of Incorporation (MOI) will provide that Maziv
shallnot perform, permit, concludeorimplement any reserved matterssetoutunless
every controlling shareholder has confirmed its support for the relevant reserved
matter in writing. These are set out in detail in schedules to the MOI and include the
approval of Maziv’s annual budget and business plan and the appointment of a CEO
and a CFO. In short, Maziv will require the written consent of Vodacom to engage in
conduct as specified in schedule 2 of the MOI. The view was taken by the merging
partiesthattheseadditionalminorityprotectionrightsamountedtoamaterialinfluence
for the purposes of s 12(2)(g)of theAct and therefore merger approval was required
fromthecompetitionauthorities.
TheTribunal’sdecision
[20] With this context, I turn, albeit briefly, to deal with the fundamental concerns
raisedbytheTribunalinitsjustificationforrefusingtoapprovethemerger.Inessence,
the Tribunal found that the merging parties had not been able to satisfy it with regard
the Tribunal found that the merging parties had not been able to satisfy it with regard
to various vertical and horizontal competition concerns. The horizontal effects which
the Tribunal found as a result of the merger were that there would be a potential
reduction of competition between Vodacom and Maziv in FTTH, FTTB services and
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metro/backhaul infrastructure. In its view, the proposed transaction would entrench
Vodacom’s dominance. The merger would reduce potential future competition
between Vodacom and Maziv in building out overlapping fibre networks, particularly
FTTH. It found that, absent the merger, Vumatel would expand into areas where
Vodacomhad plansorexistingcoveragesuggesting thepossibilityof rivalrybetween
thesefirmswhichthemerger wouldeliminate; inparticulartheeliminationof potential
competition and the reduction of rivalry particularly in high income suburbs and
emergingtownships.
[21] The Tribunal criticised the evidence of the economic experts who testified on
behalf of the merging parties as representing a static approach to the potential of
horizontalforeclosure.It said:
‘A static competition assessment is deeply unsatisfactory when a merger has a defensive
motive (as we have noted Maziv has) and furthermore takes place in markets enjoying
substantialanddynamicgrowth.Anassessmentofdynamiccompetitiveeffectsisappropriate
giveninteraliathat the FTTH/FTTB space is set for a second land grab with follow-through
growthforthebackhaulinfrastructure,drivenby5Grollout also.’2
[22] In the view of the Tribunal, the strategic documents of the merging parties
showed as did, in particular, the evidence of Mr Pieter Uys head of strategic
investments at Remgro Ltd and the chairperson of the CHVH board, that Vodacom
would have pursued options alternative to the proposed merger, in the event that the
latterdidnottakeplace.Itfoundthatitwouldgrowitsfibrefootprintinbothmetroand
FTTB and would grow to be an effective and even formidable competitor to Maziv’s
businessinrespectofthesemarkets.
[23] The Tribunal was of the view that the evidence confirmed that, in a counter
factual,Vodacomwouldlookatajointventureandpartnershipstoexpandinfibreand
thus compete with Maziv. Were the merger not to be implemented, a range of pro-
competitive benefits of future competition between Maziv and Vodacom would occur.
competitive benefits of future competition between Maziv and Vodacom would occur.
It was this possibility that was seen by Maziv as a massive threat to its businesses
with significant impactonitspricing policy.
2 Para632 ofTribunal‘s reasons
9
[24] Turningtoverticalforeclosure,beingtheriskthatthemergedentitycouldcause
harm by limiting rival firms’ access to credible upstream or downstream inputs, the
TribunalfocusseditsreasoningonVodacom’sabilityandincentivetoforecloseMNO’S
together with ISP’s from accessing fibre infrastructure owned by Maziv via its
subsidiaries, DFA and Vumatel. It noted that DFA had provided dark fibre on a
wholesale open access basis, which was essential to MNO’s mobile networks and
backhaul while Vumatel supplied FTTH and FTTB, often on an open access model
usedbyISP’s.
[25] TheTribunalfoundthatitwasabletolocatecredibleconcernsthatthemerging
entities would discriminate in pricing by giving Vodacom better wholesale terms than
itsrivals,itwoulddelayaccessordegradequalitythroughslowerprovisioningorlower
service levels it would refuse to deal or limit capacity and would engage in bundling
orcrosssubsidisationbycombiningVodacom’smobileandfibreservicesinawaythat
rivalscouldnotmatchwithoutequivalentaccess.
[26] It therefore concluded that Vodacom had a strong incentive to foreclose,
especiallyasitcompeteddirectlywithMNO’slikeMTNandRainandISP’s,usingDFA
and Vumatel. The merged entity would consequently have the ability to do so given
the scale and significance of Maziv’s infrastructure. As noted, the Tribunal relied for
these findings on internal Vodacom strategy documents which showed an intent to
gainacompetitiveadvantagebybundlingfixedandmobileservices.Itconcludedthat
Vodacom’sinterestinMazivwasnotpurelypassivebutstrategicallymotivated;thatis
toconsolidatepowerinfibreandreduce infrastructurecompetition.
[27] Turning to the remedies proposed by the merging parties, it found that
behaviouralremediessuchasnon-discriminationclausesandpricereportingmonitory
trusteeswouldbeinsufficienttomitigatetheforeclosureriskswhichithadfound.
[28] The Tribunal found that the only structural remedy offered in relation to its
findingsofhorizontalforeclosurerelatedtoadivestiture ofFTTHinfrastructure,which
findingsofhorizontalforeclosurerelatedtoadivestiture ofFTTHinfrastructure,which
it considered was both limited and insufficient. It further found that the complex and
technical behavioural remedies offered by the merging parties which were aimed at
addressing vertical foreclosure such as discriminatory access to fibre infrastructure
10
were ‘not effective’ and would fail to prevent preferential treatment to Vodacom post
the merger. Furthermore, it found that the remedies were unenforceable in practice
owing totheircomplexityandtheindefinitetimeframeoverwhichtheywouldneedto
operate. These remedies would require the Commission and subsequently the
Tribunal to act asde factosector regulators which fell outside of the institutional
mandate of these bodies. It found further that the DFA’s post-merger incentive to
foreclose access and to offer favourable terms to Vodacom at the expense of
competitors remained intact. The remedies did not trigger structural change to these
incentives. Despite proposed ring-fencing and non-disclosure arrangements, the
Tribunal was not satisfied that these measures would prevent leakage of sensitive
competitor information between DFA and Vodacom. Furthermore, there were no
credible punitive consequences built into the proposed remedies in the event that
violationsoftheproposedremediesoccurred.Whileitnotedthattheverticalremedies
mightberegardedastheoreticallyappealing,theywerepracticallyflawedduetotheir
complexity and enforceability problems and inability to change underlying economic
incentives.
[29] In summary, the competitive risks were long term and dynamic, involving
complex commercial strategies that would be extremely difficult to police. The only
effective remedywouldbetoprohibit the mergerratherthan allowthe mergerto take
placesubjecttothe inadequateconditionsasproposed.
Materialmisdirections bytheTribunal
[30] As indicated earlier, it is not the intention of this judgment to traverse all of the
findings of the Tribunal in respect of horizontal and vertical foreclosure. However,
counselforthemergingpartiesemphasisedthattherewassomeextremely important
misdirection’son thepartoftheTribunalandthesedodeservesomeanalysis.
[31] Counsel for the merging parties attacked the basis by which the Tribunal had
sought to deal with the relevant counterfactual. As Richard Whish has noted with
sought to deal with the relevant counterfactual. As Richard Whish has noted with
respect to the obligations of a competition authority in evaluating a potential
counterfactual:
‘The counterfactualwillusuallybetheprevailingconditionsbeforethemerger althoughthere
maybecasesinwhich itis necessarytotakeintoaccountconditionsasthey wouldbeinthe
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nearfutureif, forexample, it isknownthatotherfirmsareabouttoenterorexitthemarketor
to expand capacity; another example would be that one of the merging parties was on the
pointoffailingsothatitwouldnotbepresent onthemarketinthefutureanyway.’3
[32] This succinct description of what is required in the determination of a counter
factualemphasisesthat,unlessthereisclearevidencethatthereisadynamisminthe
marketsuchasthatchangewillhappen,itdoesnotbehovetheTribunaltofindmaterial
changes to a status quo, in the absence of clear evidence to that effect. That,
accordingtocounselforthemergingparties,didnotoccurinthiscase.Tothecontrary,
the evidence relied upon by theTribunal to support its conclusion was, in his view, at
worst non-existent and at best tendentious. For example, the Tribunal relied on the
CIVH board minute of March 2021, where the CIVH board raised a concern that
Vodacom could explore ‘other options’ if no deal was reached with CIVH. This
reference to ‘other options’ flowed from a discussion between Mr Uys and Mr
Mohammed Joosub,the CEO of theVodacomGroup, inwhich MrJoosub expressed
frustrations at delays on the part of CIVH in concluding the deal. In reading this
evidenceincontext,thisremarkwasnomorethanaloosethreatmadeinthecontext
of difficultnegotiationsinorderto compelCIVHtoagreeto thedeal.
[33] As Rogers JA(as he then was) noted inMediclinicSouthAfrica(Pty)Ltdand
Another v The Competition Commission4 in respect of certain corporate documents
which were employed by the Commission: ‘This document confirms the puffery one
mightexpectina salespitch’.
[34] This observation is clearly applicable to the ‘other options reference made by
Mr Joosub. Furthermore, both Mr Uys and Mr Joosub confirmed the context in which
the statement had been made and no other evidence was produced to justify a
conclusionthat Vodacom woulddevelopitsownindependentbusinessincompetition
toMaziv.
3 Richard Whish and David Bailey CompetitionLaw(10thed)at865.
toMaziv.
3 Richard Whish and David Bailey CompetitionLaw(10thed)at865.
4 MediclinicSouthAfrica(Pty)LtdandAnothervTheCompetitionCommission[2020] ZACAC 3 para
78
12
[35] To the extent that the Tribunal sought to impugn the credibility both of Mr
Joosub and Mr Uys, regrettably the Tribunal did not follow the accepted approach to
evidence as set out in theStellenboschFarmersWineryLtdandAnothervMartell&
CieSAandOthers:5
‘Tocometoaconclusionondisputedissuesthecourtmustmakefindingson(a)thecredibility
of the various factual witnesses [their reliability] … (c) the probabilities.As to (a), the court’s
findingonthecredibilityofaparticularwitnesswilldependonitsimpressionabouttheveracity
of witness. That inturnwilldependon a varietyofsubsidiaryfactors, not necessarily inorder
of importance, such as; (i) the witness’s candour and demeanour in the witness box, (ii) his
bias,latentandblatant,(iii)internalcontradictionsinhisevidence,(iv)externalcontradictions
withwhatwaspleadedorputonhisbehalf,orwithestablishedfactorwithhisownextracurial
statements or actions, (v) the probability or improbability of particular aspects of his version,
(vi)thecalibreandcogencyofhisperformancecomparedtothatofotherwitnessestestifying
aboutthesameincidentorevents.’
[36] Inshort,theTribunalisrequiredtofollow thisapproachto evidence.Itfailedto
do so in this case and accordingly its rejection, without more, ofthe evidence of both
Mr Uys and Mr Joosub was correctly criticised by counsel for the mergingparties.As
an exampleoftheflawedreadingoftheevidence,theTribunalfocusedonfivepages
ofa117-pagedocumentwhichwaspartoftheboardpackpreparedforaspecialboard
meetingofCIVH.ItthenemphasisedtheSWOTanalysisassetoutthereinbutignored
the full analysis to concentrate exclusively on the threats section of the SWOT
analysis. In turn, it ignored Mr Uys’ evidence that the SWOT analysis was a general
SWOT analysis for CIVH and was not the rationale for the proposed merger. The
Tribunalalso ignored the explanation of the chairman ofthe investment committee of
the Board, who had commissioned the presentation. He said the presentation was
prepared by ‘management and the advisors listing all possible scenarios they could
prepared by ‘management and the advisors listing all possible scenarios they could
thinkof’.Insummary,theTribunalhadfailedtoreadthecontextoftheverydocument
uponwhichithadheavilyrelied.
[37] Counsel for the merging parties then sought to locate fundamental
misdirections,whichhesubmitted werecommittedbytheTribunalon thebasisofthe
5 Stellenbosch Farmers Winery Ltd andAnother v Martell & CieSA and Others 2003 (1) SA 11 SCA
para5
13
assumptions which it had made and on which the entire decision then proceeded to
be developed.
[38] The Tribunal at para 75 of its reasons emphasised the importance of context
as follows: ‘To provide context to the assessment that will follow we explain certain
generalfeaturesofthesectorandtheterminologyused...’.
[39] That context is then developed at para 95 under the header ‘alleged historyof
collusion between Vodacom and MTN’. The Tribunal proceeded to refer to a 1996
Financial Mail (FM) report regarding a meeting between Vodacom and MTN, which
took place in London in 1994 to discuss pricing.A memorandum was then prepared
which ‘allegedly outlined agreements on tariff structures, airtime discounts and
connection bonusses. At the time, Vodacom and MTN said that the agreement
reachedinLondonwas‘legalandnotanti-competitive’.Referenceisthenmadeinthe
FM report to a comment of the former Competition Tribunal chairperson Mr David
LewisthatVodacomandMTN‘concoctedlegalstratagemsdesignedtokeeptheissue
outof court’.
[40] Theinclusionofthisreportinitsdecisionandthereliancethereonisregrettably
disturbing in that, as counsel for the merging parties informed the Court, none of this
was placed intoevidence before theTribunalin circumstances where the partieshad
an opportunity to deal therewith. This is not a case where the Tribunal took judicial
noticeoffactsthatwerewidelyknownandnotsubjecttoreasonabledispute.Thiswas
an exercise in which the Tribunal relied on evidence, which was never part of the
record,whichwasneverpresentedtotheparties,andwhichclearlycompromisedthe
fairness and impartiality of the proceedings. Manifestly, when the Tribunal engaged
withtherationalefortheproposedtransaction,theassumptionof‘nefariouspractices’
committedinpartbyVodacomwasonitsmindwhenitconsideredtherationalforthe
transaction.Insummaryitfoundthat:
‘[W]e haveto reject themerger parties’claim that Maziv would continue doing business as if
itwereunawareofVodacom’spresence. MTNinourviewcorrectlycharacterisesas“artificial”
itwereunawareofVodacom’spresence. MTNinourviewcorrectlycharacterisesas“artificial”
the merger parties’ arguments that Vodacom’s and Maziv’s “perspectives would remain
discreteratherthanintertwined”.’
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[41] The approach that the Tribunal clearly adopted as to the motivations of
Vodacominparticular were correctly described by counsel for the merging parties as
the source of the infection in respect of the reasoning which followed in order to
dismiss the evidence presented by the merging parties as to the justifications for the
prosedtransactions.
[42] A number of further instances of misdirection were raised by counsel for the
mergingparties.OnthebasisoftheapproachwhichIintendtoadopttothisappeal,it
isnotnecessarytotraverseeachandeverysuchallegedmisdirectionnotwithstanding
themeritsthereof. hisisbecausethisappeal,asindicatedintheintroduction,canbe
disposedofonthebasisthateveniftheTribunalwascorrectwithregardtoitsfindings
on foreclosure, its decision to refuse to approve the proposed merger must now be
reevaluated on the basis of the amended conditions agreed to between the merging
partiesandtheCommission.Thepurposehoweverforreferringinsomedetailtothese
disturbing features of the Tribunal’s reasoning is to guide it in future so as to ensure
meticulous and careful application of established rules of evidence, which must be
followed.6
Theroleoftheamendedconditions
[43] In orderto approach the consequencesofthe conditions to which the merging
partiesand theCommission have nowagreed and which the partiesnowargue must
formthebasisuponwhichtheapprovalofthemergershouldtakeplace,itisimportant
todealwiththelegalframeworkpertainingtoboththeconditionsandthefurtherissues
astothepublicinterestgrounds,uponwhichitwascontendedbeforetheTribunalthat
themergercouldbejustified,aswellastheimplicationsthattheconditionsholdforan
overallSLCtest.
[44] Section12AoftheAct,asamended,requiresinrelevant partthat:
‘(1) Whenever required to consider a merger, the Competition Commission or Competition
Tribunalmustinitiallydeterminewhetherornotthemergerislikelytosubstantiallypreventor
lessen competition, by assessing the factors set out in subsection (2), and if it appears that
lessen competition, by assessing the factors set out in subsection (2), and if it appears that
themergerislikelytosubstantiallypreventorlessencompetition,thendetermine –
6 The approach adopted by the Constitutional Court inVodacom(Pty)LtdvMakateandothers[2025]
ZACC13at para 41-49isinstructive.
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(a) whetherornotthemergerislikelytoresultinanytechnological,efficiencyorotherpro-
competitivegainwhichwillbegreaterthan,andoffset,theeffectsofanypreventionor
lesseningofcompetitionthatmayresultorislikelytoresultfromthemerger,andwould
notlikelybeobtainedifthemergerisprevented;and
(b) whetherthemergercanorcannotbejustifiedonsubstantialpublicinterestgroundsby
assessingthefactorssetoutinsubsection(3).
(1A) Despiteitsdeterminationinsubsection(1), theCompetition CommissionorCompetition
Tribunal must also determine whether the merger can or cannot be justified on substantial
publicinterestgroundsbyassessingthefactorssetoutinsubsection(3).
…
(3)Whendeterminingwhetheramergercanorcannotbejustifiedonpublicinterestgrounds,
the Competition Commission or the Competition Tribunal must consider the effect that the
mergerwillhaveon–
(a) aparticularindustrialsectororregion;
(b) employment;
(c) theabilityofsmallandmediumbusinesses,orfirmscontrolledorownedbyhistorically
disadvantaged persons, to effectively enter into, participate in or expand within the
market;
(d) theabilityof nationalindustriestocompeteininternationalmarkets;and
(e) the promotion of a greater spread of ownership, in particular to increase the levels of
ownershipbyhistoricallydisadvantagedpersonsandworkersinfirmsinthemarket.’
[45] Counsel for the Minister provided a helpful basis by which to analyse the
structureofthe inquiryasenvisagedintermsof s12A.Theinitialstep istodetermine
whether the proposed merger would result in a substantial lessening of competition
(SLC) using the factors, which are set out in subsection 12A(2). In this regard, the
Tribunalisrequiredtoassessallthe available evidenceagainst,interalia,thefactors
setoutins12A(2)astheyapplytotheparticulartransaction;forexamplewhetherthe
merger would result in a removal of an effective competitor, the presence of barriers
to entry, foreclosure concerns or the likelihood of coordinated conduct.7 Once the
Tribunal hasengagedwith the SLC testand, on the basis that it had established that
Tribunal hasengagedwith the SLC testand, on the basis that it had established that
the SLC test will be met, it is required to weigh such effects against merger specific
technological efficiency or other pro-competitive gains that could not otherwise be
achievedintheabsenceofthemerger.
7 Section 12A(2)unlikesection12A(3) is notaclosedlistoffactorstobeconsidered.
16
[46] This then permits the Tribunal to arrive at the final competition effect by an
evaluation of the SLC effects against any efficiency or other pro-competitive gains.
Once this enquiry has been concluded, the Tribunal is then required to engage with
the public interest test. It must be conducted independently of the competition test
which has been undertaken. The public interest inquiry, as set out in subsection
12A(3), confines that enquiry to five enumerated factors, which are listed in
subsections(a)to(e)of s12A(3). It isimportanttoemphasise that the legislature did
notprovideforanunenumeratedlistofpublicinterestconcerns.Itconfinedtheenquiry
tothe fivespecificfactors
[47] Section12(1A)emphasisesthat,notwithstandingtheoutcomeoftheSLCtest,
the enquiry with regard to public interest focus on whether the merger can or cannot
be justifiedonsubstantialpublicinterestgrounds.
[48] That leads to the manner in which the five enumerated factors are to be
considered. InEpirocHoldingsSAvK2022596519(SouthAfrica)(Pty)LtdandPolka
DotsProperties117(Pty)Ltd,theTribunalsaid:8
‘Asregardsthe publicinterestanalysisunders12A(3) of theAct, theTribunalhaspreviously
explainedthatitisholisticone,intermsofwhichthedifferent publicinterestgrounds listedin
section 12A(3) must be separately assessed and then, if necessary, weighed against each
otherinordertoarriveatanetconclusiononthepublicinteresteffectsofthemerger.’
[49] In effect, as I understand thisdictum, it indicates that each of the individual
public interest factors as well as any commitments made by the merging parties to
addresstheseareevaluated,andthereafterthepublicinterestconsequencesmustbe
considered cumulatively. While an individual commitment may be modest on its own
terms, a cumulative assessment could conclude that the overall public interest effect
on the mergerin termsof all the s 12Afactors(or as manyas maybe relevant to the
merger under scrutiny) can dictate a particular positive or negative conclusion in
respectof theimpugnedmerger.
respectof theimpugnedmerger.
8 EpirocHoldingsSAvK2022596519(SouthAfrica)(Pty)LtdandPolkaDotsProperties117(Pty)Ltd
[2023]2CPLR20(CT)para75.
17
[50] Finally, the Tribunal needs to weigh up the conclusion it reached in respect of
the SLC test with the conclusion it reached in respect of the public interest factors to
arriveat thefinaloutcome. Inmanycasesthetwoconclusionsmaypointinthesame
direction,inwhichcasethebalancingexercise isunnecessary.Butwhereitdoesnot,
the weighing exercise must be conducted. This is no easy task. Nevertheless whilst
such balancing isnotsusceptible to a mathematical evaluation it must at least be the
basisofa rationalexplanation forwhatever conclusionisfinallyadopted in respect of
themerger.
[51] Inthepresent case,theTribunaldismissedthe relevanceofthemajorityofthe
publicinterest conditions that were raised bythe merging partiesfora lack of merger
specificity because it was of the view that these commitments would eventuate
regardless of whether the merger took place. This raises the question of merger
specificity. Although it concerned the question of whether the party had retrenched
staffinbreachofcertainemploymentrelatedconditions,whichhadbeenstipulatedby
the Commission, the Constitutional Court inCoca ColaBeveragesAfrica (Pty)Ltd v
CompetitionCommissionandAnother9 in dealing with the test for a causal nexus on
which a merger specificity could be found, noted that part of the test was an
examinationof the ‘“pre-mergercounterfactual”; that is,whatwouldhavehappened if
the merger had not taken place and whether the impugned decision-making was
“sufficientlycloselyrelatedtothemerger”’.
[52] InthepresentcasetheevidenceindicatedthattheinvolvementofVodacomas
a strategic investor in Maziv, committed to a long-term investment, provided greater
weight to the probability that there would be further investments in fibre roll outs in
unserved areas. Mr Uys testified that having a long term investor already heavily
invested and committed in South Africa to share the risks associated with these roll
outspermittedtheopportunityforMazivtoexpandtherolloutintounservedareas.In
outspermittedtheopportunityforMazivtoexpandtherolloutintounservedareas.In
addition, the Tribunal found that the merging parties made a series of public interest
commitmentswithoutanyevidentialjustificationthatthesewouldtakeplacenomatter
whether the merger was approved. The Tribunal found, regrettably on the basis of a
9 CocaColaBeveragesAfrica(Pty)LtdvCompetitionCommissionandAnother2024 (4)SA391 (CC)
para62.
18
misreading of the strategic documents, that the various public interest commitments
wouldhavehappenedevenabsenttheproposedmerger.Therecanbelittledoubtthat
but for the conditional approval of the proposed merger the various public interest
commitmentsmaynothavebeenrealised.Oncetheimplementationofthetransaction
wasmade conditionalonthisrealisation of the merger, it becamecertainthat eachof
them, read together, complied with the approach adopted by the Constitutional Court
inCompetitionCommissionofSouthAfricavMediclinicSouthernAfrica(Pty)Ltdand
Anotherparticularlyatpara73,wheretheCourtsaid:10
‘Maintaining or increasing the scope for choice of essential and much-needed services with
particular regard to the plight of the financially under-resourced or the vulnerable, should
alwaysbeatthebackofthedecision-makers’mindswhendealingwithmergers.’
[53] As counsel for the Minister noted, the commitment by the merging parties to
invest in lower income areas, the proposed FTTH connection of schools and police
stations, which at present are without such connection, held the possibility of
significantchange in under resourced communities.ThattheTribunal elided over the
impact of these commitments to the public interest provisions as set out in the Act
compounded the conclusion that theTribunal’s approach to public interest conditions
constitutedthekindofmisdirection whichjustifies itsfindingbeingsetaside.
[54] In addition, the Tribunal appears to have conflated the SLC test with specific
publicinterestfactors.AscounselfortheMinisteremphasised,s12A(3)onlyprovides
for five specific public interest grounds; anything which falls outside of these factors
mustbelocatedwithinthecontextoftheSLCtest.Butcomparethisconclusiontothe
Tribunal’sattempt ataweighingupexercise;
‘The economic experts agree that to the extent that a merger results in substantial harm to
competition in the provision of data services, this is likely to worsen the terms of access to
competition in the provision of data services, this is likely to worsen the terms of access to
dataservicesandwillharmSouthAfrican consumers.Ontheotherhand, totheextentthat a
merger results in fibre being deployed faster and more extensively in the market as a whole
than without the merger, particularly to low-income areas this would be likely to benefit
consumers.TheTribunalmustinthiscasedeterminewhetherornotthemerger-specificpublic
interestbenefitsoutweighthecompetitiveharm.’
10CompetitionCommissionofSouthAfricavMediclinicSouthernAfrica(Pty)LtdandAnother2022(4)
SA323(CC)para73.
19
[55] The problem is that conditions that are likely to benefit consumers cannot be
located in the five factors set out in s 12A(3). By contrast, these need to form part of
theenquiryrelatingtotheSLCtest, whichtheTribunalfailed todo.
[56] InCompetition Commission ofSouthAfricav Mediclinic SouthernAfrica (Pty)
LtdandAnother112022 (4)SA323(CC)MogoengCJsaidatpara71:
‘InInterpretingsection 12AoftheAct, theCompetitionAppeal Courtmajority wasrequiredto
have had regard to the provisions of s 39(2) of the Constitution which provides instructive
guidance in construing any provision, including s 12A, the Preamble andpurpose of theAct.
This should have been done also with due regard to the State’s constitutional obligation to
give effect to the rights in the Bill of Rights. Besides, both the Tribunal and the Competition
Appeal Court are institutions of the State that bear the obligation to facilitate rather than
impede, albeitinadvertently,therightofaccesstohealthcareservices.’
[57] The breath of thisdictumindicates that not only does the Constitution impact
upontheinterpretationofthepublicinterestgroundsbutalsomustbeemployedinthe
developmentoftheSLCtest.Accordingly,theSLCtestneedstobebroadenedinorder
to take account of the constitutional imperative of interpretation through the prism of
thenormativeframeworkof theConstitution.
[58] This approach now finds considerable support in a burgeoning literature in
whichthe ChicagoorientatedapproachtotheSLCtesthasnowbeenrevisited.12For
example,StavrosMakrishasarguedthatthereshouldbearecalibrationofcompetition
law in that, in effect, the SLC test cannot simply be located ina narrow conception of
consumerwelfare.Inthisconnectionhecontendsthatcompetitionlawshouldseekto
protect what he refers to as “the most vulnerable consumers”, a standard which
focuses on the most vulnerable consumers, and which would concern itself with the
impact of an agreement or a practice on a particular cluster of consumers (or end
users)beingtheleastfortunateormostvulnerable.13
users)beingtheleastfortunateormostvulnerable.13
11Fn1o above para7.
12 By this is meant a narrow consideration of the effect of price and output as a consequence of an
impugnedtransaction.
13 Stavros Makris ‘A Smithian Political Economy Approach for the Competition Law of Twenty First
Century’2025(88)ModernLawReview712;seealso ElettraBietti‘RawlsianAnti-Trust’NorthEastern
UniversitySchoolofLawResearchPaper 261(2025).
20
Applicationofthelaw totheamendedconditions
[59] Asindicatedearlierinthisjudgment,theTribunalconsideredthattheremedies
were insufficient to address both the horizontal and vertical theories of harm. The
reasoning employed by the Tribunal in rejecting the remedies proposed is critical to
show how the agreed revised remedies have sought to cure the objections. For
example,withregardto aproposedremedyinwhichthere wouldbedivestitureofthe
overlapping wholesale fibre infrastructure of either Vodacom or Maziv within of the
implementationdate,itfound‘thatthedivestitureconditiondoesnotaddressSLCthat
is likely to result from the merger and the harm to consumer welfare remains’. The
Tribunalfoundthatthisconditionlackedsufficientdetailsincetherewerenoprovisions
for a trustee to ensure that the overlapping infrastructures be divested, should the
merging parties fail to find a buyer or maintain the infrastructure pending the sale
thereof, ensure that the assets would not be devalued in any way, ensure that there
wasno reductioninqualityorerosionofcustomerserviceswhereapplicable.
[60] Withregardtoverticalforeclosure,theremedieswhichwereofferedwithregard
to the regulation of who could be appointed or nominated to the board of directors of
an entity within the Maziv Group and the proposed restrictions regarding reserved
matters and Vodacom shareholder representation, the Tribunal concluded that the
conditions tendered did not adequately address concerns regarding Vodacom’s
exercising co-control or influence over the policy of Maziv post the merger. In
summary,theTribunalwasoftheviewthattheproposedconditionswereincapableof
being effectively monitored and enforced. In particular, the Tribunal emphasised the
point that the appointment of a monitoring trustee ‘had no legal remedial or
enforcement powers. The monitoring trustee will not be able to prevent non-
compliance and will simply react by reporting its view of non-compliance to the
Commissioninordertobefairtoallpartiesconcerned. Itwillthenhavetocommence
Commissioninordertobefairtoallpartiesconcerned. Itwillthenhavetocommence
its own thorough investigations to independently establish whether there has been a
breachoftheconditions.BythetimetheCommissionreceivesthecomplaintfromthe
monitoring trustee and then completes its own investigation it may be too late to
“unscrambletheegg”andundueanyharmthatwouldhaveoccurredfromtheconduct.
21
[61] While the merging parties contended that the Tribunal had erred materially in
itsevaluationoftheinitialconditions,bothitandtheCommissionwereoftheviewthat
the amended conditions which had been agreed to by the parties satisfactorily cured
alltheearlierdeficiencies.
[62] As indicated earlier in this judgment, certain of the proposed conditions must
belocatedwithinthebroadcontextofanSLCtest.Thus,therevisedconditionsimpose
a clear obligation on the merging parties to divest wholesale fibre infrastructure in
areaswhereVodacomhasrolledout infrastructurewhich;
(i) hasoverbuiltMazivFTTHinfrastructure;
(ii) hasbeentransferredtoMazivin termsofthemerger;and
(iii) VodacomisusingtoprovidewholesaleFTTHservices.
[63] A revised clause now imposes significant powers insofar as the monitoring
trustee isconcerned.It obligesMaziv and Vumatel to conducta divestituresubjectto
a transparent and competitivebidding process which will facilitate broad participation
by a prospective purchaser. The monitoring trustee shall, during the divested period,
havesolediscretiontodetermineafairvaluefortheoverlappinginfrastructure.Where
themonitoringtrusteeacceptsanofferfromanypurchaser,heorsheshallnotrequire
engagementorbesubjecttotheinputofthemergingparties.Anobligationisimposed
upon the parties to ensure that the divested agreement is implemented as soon as
practical after the date of signature of the agreement of Maziv. From the
implementationdateuntiltheinfrastructurehasbeensoldtheyareobligedtopreserve
andmaintaintheoverlappinginfrastructureandmanagetheoverlappinginfrastructure
with reasonable careand skillpursuanttogoodbusinesspractices.
[64] ThisconditionisclearlydesignedtorespondtotheconcernsoftheTribunal,in
particular the possible increase in concentration and overlapping FTTH areas and, if
anewentrantbuystheinfrastructure,thedifficultyitmayhavetobecomeaneffective
competitorwithoutVodacomasananchorcustomer.
[65] Clauses 3, 11 and 12 of the revised conditions seek to dilute the extent of the
[65] Clauses 3, 11 and 12 of the revised conditions seek to dilute the extent of the
control that Vodacom may exercise over Maziv, thereby reducing the ability to
forecloseandthusdiminishingtherisksofforeclosurethatneedtobepolicedthrough
22
the conditions. In particular, Vodacom has undertaken that it will not increase its
shareholdingwithMazivtomorethan34.95%withouttheconsentoftheCommission.
This was a response to a concern which was clearly motivated by the judgment in
CompetitionCommissionofSouthAfricavHoskenConsolidatedInvestmentsLtdand
Another,14inwhichtheCourthadheldthatatransactioninvolvingTsogoSunHoldings
Limited(Tsogo)in2017wasnotanotifiablemergerintermsofActsincetheacquisition
of Tsogobythe appellant had been notified and approved in 2014. In short,the 2017
transaction was merely the implementation of the 2014 merger and accordingly the
Commission could not reinvestigate the 2014 merger. The fact that the merger had
beennotifiedin2014meantthat the appellant’sintentiontoacquireadditionalshares
inTsogoinordertoincreaseitsshareholdingfrombetween47%tomorethan50%of
Tsogo’s issued share capital did not necessitate a further investigation by the
Commission. By contrast, clause 3.6 circumvents thisdictumby obligating Vodacom
to seek the consent of the Commission if it wishes to increase such shareholding in
Mazivbeyond34.95%.
[66] Similarly, clause 11 provides for an additional independent director to be
appointed to the Mazivboardand an additional independent director to be appointed
to the nominations committee of the board. These changes reduce the influence that
Vodacom will have on the Maziv board. In addition, Vodacom’s veto rights may only
be used in instances where the proposed business plan and budget would result in
theimpairmentofVodacom’sinvestmentinMaziv.Thenewclause12.3limitstheveto
right, stipulating that Vodacom shall not use its veto right in respect of any of Maziv’s
entities business plan and budget to restrict capital expenditure below the stated
threshold. In short, these additions are designed to address the concern about the
control that Vodacom could potentially have exercised over Maziv and accordingly
thereforehaveadirecteffectonthe evaluationoftheSLCtest.
thereforehaveadirecteffectonthe evaluationoftheSLCtest.
[67] Clause 10 of the revised conditions includes a commitment by Vodacom to
achieve a 5G population coverage of 90% within five years. Accordingly, it has
committed to R 60b of capital expenditure spent on rolling out no less than 564 5G
14CompetitionCommissionofSouthAfricavHoskenConsolidatedInvestmentsLtdandAnother2019
(3)SA1(CC).
23
sitesper annum. Clause 10.2 also contains connecting additionalfixed wireless
access usersover a five-year periodwith packages of 100GB or more permonth. Of
particular importance isclause 17.6 in terms of which Maziv undertakes that by
it willachieve an average connection rate across existing and new
infrastructure in lower income areas which means in each suburb, town, village,
townshipandinformalsettlementinSouthAfricawheretheaveragehouseholdincome
isless than or equal toR 254 495 per annum. That undertaking imposes obligations
upon Mazivto achievean average connection rate ofat least...in reach areasandin
keyareassubject to astipulatedvariation.
[68] Key areas are defined to mean an average household income of less than R
60 000perannumwhichamountshallbeadjustedforinflationannually.Reachareas
means lower income areas that are not key areas. In short, clause 17.6 imposes an
obligationuponMazivtoconnectsignificantcohortsofthepopulationinimpoverished
areas, at the very least areas where consumers would struggle to otherwise be
connected. This particular provision will ensure that consumers pay the lowest
possible price or in certain instances maynot have to pay any priceat all in order for
Mazivtofulfilitsobligationcontainedin clause17.6.
[69] Insummary,noneoftheseparticularprovisionscanbelocatedinthefiveareas
specified as public interest concerns. All of these address the most vulnerable
consumers in society and accordingly must form part of an SLC test. To that extent
therefore, even if the Tribunal’s decision on foreclosure was to stand, an overall
evaluationofanSLCtest,takingintoaccounttheobligationtointerpretthetestwithin
the prism of the Constitution and therefore within a broader concept of consumer
welfare as indicated justifies the conclusion that these conditions outweigh the initial
concernsarticulated intheTribunal’sdecision.
[70] Inaddition,therevisedagreementunquestionablyincludescommitmentswhich
arerequiredtobeincludedinthedeterminationofthepublicinteresttest.Clause17.3
arerequiredtobeincludedinthedeterminationofthepublicinteresttest.Clause17.3
provides for the establishment of an Enterprise and Supply and Development Fund
which has as identified beneficiaries, local contractors and distributors involved in
infrastructure build and fibre uptake process fund. It will pay for business support
24
and/coaching services rendered to small and medium size enterprises (SME’s)
particularlyvendors owned by historically disadvantaged persons in the
telecommunications sector as well as support and development training of SME’s
including in respect of business accounting, financeplanning, strategy
communications, advertising governanceand human resources.
.
There is also an increaseinprocurement spend on goods manufactured and
assembled and services provided in South Africafrom a benchmark ratio of
[redacted]%(ofapproximately[redacted])toat least[redacted]%.
[71] Therevisedagreementalsoprovidesforthecreationof10 000directorindirect
jobs,whichclearlyfallwithintheframeworkofthepublicinterestconcerns.Thesame
would apply to an increase in an amount contributed by Maziv to an employment
benefit schemein theamount of . To the extent thatcertainregions will
besubstantiallyaffectedbythecommitmentsmadebythemergingparties,reference
shouldbe made toclause 10.4 whereby the merging parties commit to increase the
number of police stationsto be provided with fixed wireless accessto100.Thereis
also a commitment to providesuchaccess to1573 health care facilities,and 210
libraries.Clause 17.2.1 provides free uncapped access towholesale FTTH services
toeveryschool,bothprivateandpublic.
[72] Manifestly, these conditions will have a material effect on poorer areas of the
country which to date have been denied the obvious benefits of such access. When
account is taken of the conditions which must now form part of the SLC test, andthe
various public interest commitments which are directed, to a significant extent, to
benefittingthepoorestsectionsoftheSouthAfricanpopulation,there islittleroomfor
any other conclusion than that the decision by the Tribunal to refuse approval of the
mergermust besetaside.
[73] Two parties, Amandla Mobi and Wireless Access Providers Association were
afforded the right to make submissions, notwithstanding that neither party had been
25
an intervenor inthe proceedingsbefore theTribunal. They placed no new arguments
beforethisCourtthatcouldhaveledto adifferent conclusion.
[74] Intheresultthereforethe followingorderismade:
1. The Tribunal’s order prohibiting the merger is set aside and replace with the
followingorder:
a) Themergerisapprovedsubjectto conditionswhichareattachedtothis
Judgment.
2. Thereisnoorderastocosts.
________________________
DavisAJA
26
Appearances
Forthefirstappellant: DTurnerSCand LZikalala
Instructedby: Cliffe DekkerHofmeyr
Forthe secondappellant:JWilsonSC,NLuthuliandKWilliams
Instructedby: DLAPiper
Forthethirdappellant: MLe RouxSCandKGwaza
Instructedby: WerksmansAttorneys
Forthe respondent: DBergerSC,NMuvanguaandAMsimang
Instructedby: CheadleThompson &HaysomIncAttorneys
ForMTN:
Instructedby:
RPearseSCandACachali
a WerksmansAttorneys
ForAmandlaMobi: PNgutshanaSC,NSakataandYPattni
Instructedby: MbuyisaMoleeleAttorneys
.
CONFIDENTIAL
REVISED VERSION AS AT 08 JULY 2025 AS OFFERED BY MERGER PARTIES TO COMMISSION
1
ANNEXURE A
Commission Case No: 2021Dec0018
In the large merger between:
VODACOM PROPRIETARY LIMITED
And
BUSINESS VENTURE INVESTMENTS NO 2213 PROPRIETARY LIMITED ("MAZIV"), A WHOLLY
OWNED SUBSIDIARY OF COMMUNITY INVESTMENT VENTURES HOLDINGS PROPRIETARY
LIMITED
CONDITIONS
1 DEFINITIONS
1.1 " Affected Employees" means (i) in the case of Vodacom SA, Employees of Vodacom SA
who will be relocated within Vodacom SA as a result of the Merger, being Vodacom SA
Employees currently associated with the Vodacom FTTH business and the Vodacom
Transfer Assets who will be redeployed to other divisions within Vodacom SA; and (ii) in
the case of Maziv means all Employees of Vumatel and DFA and their respective wholly-
owned subsidiaries at the Implementation Date;
1.2 " Approval Date" means the date of the approval by the Tribunal or the Competition Appeal
Court, as the case may be, of the Merger;
1.3 " B-BBEE Act" means the Broad-Based Black Economic Empowerment Act 53 of 2003;
1.4 “B-BBEE Ownership Status” means the percentage ownership attributable to an entity
by virtue of it being owned by Black People, as determined in terms of the Codes of Good
Practice (excluding the modified flow through principle);
1.5 " Black People" means Africans, Coloureds and Indians (a) who are citizens of the
Republic of South Africa by birth or decent; or (b) who became citizens of the Republic of
South Africa by naturalisation – (i) before 27 April 1994; (ii) on or after 27 April 1994 and
who would have been entitled to acquire citizenship by naturalisation prior to that date, as
per Schedule 1 of the Codes of Good Practice;
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2
1.6 " Business Day" means Business Day as contemplated in section 1(1A) of the Competition
Act;
1.7 “Capex” means capital expenditure;
1.8 " CIVH" means Community Investment Ventures Holdings Proprietary Limited;
1.9 “CIVH/Vumatel Merger” means the large merger involving CIVH and Vumatel with
Tribunal case number LM109Jul18;
1.10 " Codes of Good Practice" means the Codes of Good Practice on Broad-Based Black
Economic Empowerment published by the Minister of Trade, Industry and Competition
under section 9.1 of the B-BBEE Act;
1.11 “Committed Expenditure”meansplannedcorporatesocialinvestmentexpenditureofthe
Maziv Group that has been included in the approved Maziv Group budget for the 2024
financial year;
1.12 “Commission” means the Competition Commission of South Africa.
1.13 " Competition Act" means the Competition Act 89 of 1998;
1.14 " Competition Appeal Court" means the Competition Appeal Court of South Africa.
1.15 “Conditions” mean these conditions;
1.16 " Confidential Information" means trade, business or strategic information that has
particular economic value and is not publicly or generally available to or known by others;
1.17 " Defaulting Shareholder" means any shareholder in Maziv which for a period of 7 (seven)
years from the Implementation Date, or for as long as they are shareholders of Maziv
(whichever is the shortest period), fails to maintain a B-BBEE Ownership Status of at least
30% (thirty per centum) measured in terms of the ICT Sector Codes (but excluding the
modified flow through principle) for so long as the shares of Maziv are unlisted;
1.18 “Divestiture” means the sale, either collectively or individually, of theoverlapping
infrastructure referred to in clause 8.1 to one or more Purchasers;
1.19 “Divestiture Agreement” means the written sale and purchase agreement(s) to be
entered into between Maziv and/or Vumatel and the Purchaser(s) in respect of the
Divestiture.
entered into between Maziv and/or Vumatel and the Purchaser(s) in respect of the
Divestiture.
1.20 “DFA”means Dark Fibre Africa Proprietary Limited;
1.21 “DTIC”means the Department of Trade, Industry and Competition;
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1.22 " Employee" means any person who is an employee of any of the Merger Parties or, where
the context so requires, their wholly owned subsidiaries, in terms of South African labour
law;
1.23 " Employee Benefit Scheme" means an employee share scheme (or alternatively a profit
participation scheme) to be established for the benefit of employees of the Maziv Group in
terms of clause 17.8.1;
1.24 " Excluded Employee" means any person who is employed by Vodacom SA (or has during
the preceding six months been employed by Vodacom SA) and/or any person who serves
in (or has during the preceding six months served in) any Excluded Role;
1.25 " Excluded Role" means any role which entails the relevant person:
1.25.1 serving on (i) the Vodacom Group board of directors, (ii) the Vodacom SA board
of directors, or (iii) the Vodacom SA Executive Committee; and/or
1.25.2 being involved in the effective management of any business of the Vodacom SA
Group which provides products or services in South Africa that are reasonable
substitutes for products or services provided by Maziv Group in South Africa,
including:
1.25.2.1 Vodacom SA Group's Consumer Business Unit;
1.25.2.2 Vodacom SA Group's ISP business, in relation to the supply of retail FTTH services
to residential customers and retail FTTB services to businesses.
1.25.2.3 Vodacom SA Group's Enterprise Business Unit (EBU); and
1.25.2.4 Vodacom SA Group's Wholesale business, which provides services on its national
long-haul fibre and the provision of lit or managed services, such as Carrier Connect
Metro and Access products (or the division, such as the EBU business unit, in which
the provision of lit or managed services will reside after the Implementation Date);
1.26 “FTTB”means fibre to the business;
1.27 “FTTH”means fibre to the home;
1.28 “FTTS”means fibre to the site;
1.29 “First Divestiture Period”meansaperiod of from the Implementation
1.29 “First Divestiture Period”meansaperiod of from the Implementation
Date;
1.30 “Fixed Mobile Services”meansthe operation of wireless communication links used to connect
two fixed locations (for example tower to end user) by a Mobile Network Operator but not
including microwave backhaul;
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1.31 “HDP”meanshistoricallydisadvantaged personswithinthemeaning oftheCompetitionAct;
1.32 “Herotel”means Hero Telecoms Proprietary Limited;
1.33 “Herotel Competitively Sensitive Information”means Confidential Information belonging to
Herotel Group, the exchange of which could result in a contravention of section 4(1)(a) or (b)
and/or section 5(1) of the Competition Act, including any and all information relating to:
1.33.1 pricing – including pricing of products, prices/rebates/discounts offered to
customers and/or planned price changes;
1.33.2 customer lists, customer-specific information (including details of customers'
agreements with Herotel and their roll-out plans), data relating to customers
and/or client strategy; specific subscriber contact details;
1.33.3 the portions of its business plan over which Vodacom SA is not entitled to
exercise a veto right (and thus not have access to), as contemplated in clause
12.8 below;
1.33.4 detailed costs, turnovers, budgets, sales figures in each instance in respect of
particular products and customers;
1.33.5 research and development programmes;
1.33.6 capacity information;
1.33.7 quality of services;
1.33.8 margin information of products or in relation to customers;
1.33.9 future rollout plans, future product developments, and/or present or future
technologies to be utilised in such plans or developments; and/or
1.33.10 presentations to any planning committee, including submissions, presentations
and minutes;
1.34 “Herotel Group”meansHeroteland its subsidiaries from time to time;
1.35 " ICT Sector Codes" means the Code of Good Practice on Broad Based Black Economic
Empowerment for the Information Communications Technology sector published by the
Minister of Trade, Industry and Competition in Government Gazette No. 40404 on 7 November
2016 in terms of the B-BBEE Act;
1.36 “ISP”means any licensed internet service provider;
2016 in terms of the B-BBEE Act;
1.36 “ISP”means any licensed internet service provider;
1.37 " Implementation Date" means the date after the Approval Date on which the Merger is
implemented by the Parties;
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1.38 " Key Areas" means each suburb, town, village, township and/or informal settlement in South
Africa where the average household income is less than or equal to the Key Income Value;
1.39 " Key Income Value" means at the Approval Date shall mean an average household income of
less than R60,000 (sixty thousand Rand) per annum which amount shall be adjusted for inflation
annually on each anniversary of the Approval Date by a percentage equal to the percentage
change in the consumer price index, as per the most recent information published by Statistics
South Africa or its successor;
1.40 “Licensed” means an entity duly licensed to provide electronic communications services
and/or electronic communications network services as defined in the Electronic
Communications Act 36 of 2005;
1.41 " Lower Income Areas”meanseach suburb, town, village, township and/or informal settlement
in South Africa where the average household income is less than or equal to the Lower Income
Value. For clarity, this definition comprises both Reach Areas and Key Areas;
1.42 “Lower Income Value”at the Approval Date shall mean an average household income of less
than R254,495 per annum which amount shall be adjusted for inflation annually on each
anniversary of the Approval Date by a percentage equal to the percentage change in the
consumer price index, as per the most recent information published by Statistics South Africa
or its successor;
1.43 "MOI" means the Memorandum of Incorporation of Maziv;
1.44 " Maziv" means Maziv Proprietary Limited (previously named Business Venture Investments No
2213 Proprietary Limited);
1.45 “Maziv Group”means Maziv and its subsidiaries from time to time and will include the Herotel
Group from the Vumatel/Herotel Implementation Date;
1.46 " Maziv's Competitively Sensitive Information" means Confidential Information belonging to
Maziv Group, the exchange of which could result in a contravention of section 4(1)(a) or (b)
and/or section 5(1) of the Competition Act, including any and all information relating to:
1.46.1 pricing – including pricing of products, prices/rebates/discounts offered to
customers and/or planned price changes;
1.46.2 customer lists, customer-specific information (including details of customers'
agreements with Maziv and their roll-out plans), data relating to customers and/or
client strategy; specific subscriber contact details;
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1.46.3 the portions of its business plan over which Vodacom SA is not entitled to
exercise a veto right in relation to (and thus not have access to), as contemplated
in clause 12.8 below;
1.46.4 detailed costs, turnovers, budgets, sales figures in each instance in respect of
particular products and customers;
1.46.5 capacity information,
1.46.6 quality of services;
1.46.7 research and development programmes;
1.46.8 margin information of products or in relation to customers;
1.46.9 future rollout plans, future product developments, and/or present or future
technologies to be utilised in such plans or developments; and/or
1.46.10 presentations to any planning committee, including submissions, presentations
and minutes;
1.47 " Merger" means the proposed acquisition by Vodacom SA of control in terms of section 12(2)(g)
of the Competition Act of Maziv, and the proposed acquisition by Maziv of the Vodacom FTTH
Business and the Vodacom Transfer Assets;
1.48 " Merger Parties" means the parties to the Merger namely Vodacom SA and Maziv Group;
1.49 “Mobile Network Operator”meansaLicensedoperatorthat provideswirelessvoiceanddata
communication for its subscribed users;
1.50 “Monitoring Period” meansaperiod commencingon theImplementation Dateand ending30
(thirty) days after the last monitoring report referred to in clause 19.11of the Conditions has
been submitted to the Commission and the Monitoring Trustee by Maziv, in accordance with
clause 19.11 of the Conditions;
1.51 “Monitoring Trustee” means one or more natural or legal persons approved by the
Commission and appointed by Maziv, and who shall have the duties as set out in the Monitoring
Trustee Mandate;
1.52 “Monitoring Trustee Mandate”means the mandate annexed hereto marked Appendix B;
1.53 “Ordinary Course of Business”means the businessconducted as areasonable and prudent
1.53 “Ordinary Course of Business”means the businessconducted as areasonable and prudent
operator operating in accordance with the business plan of the business;
1.54 “Product Rules” means the DFA product-specific product rules for the various DFA products
and services, including product-specific SLAs;
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1.55 “Purchaser”means an acquirer of the whole or part of the overlapping infrastructure referred
to in clause 8.1;
1.56 " Reach Areas" means Lower Income Areas that are not Key Areas;
1.57 “Reasonably Capable”means, at the time that a service is requested by a potential customer,
that: (i) the Maziv Group has existing infrastructure with available fibre capacity on the duct
route required to provide the service, (ii) wayleaves and/or all other approvals required to
provide the service have been or can be obtained, (iii) the provision of such services is
reasonably feasible (technically and/or commercially) with the application of good faith and
reasonable endeavours; and (iv) additional capital expenditure or direct costs do not need to
be incurred unless the customer is willing to commit to pay for such additional costs, it being
recorded that the Maziv Group shall not reserve any Wholesale Metropolitan Fibre Service,
Wholesale FTTH Service, Wholesale FTTB Service and/or Wholesale Key Service for any entity
within the Maziv Group and/or Vodacom SA Group;
1.58 “Reseller” means a person who (a) acquires, through lease or other commercial arrangement,
any electronic communications network service or electronic communications service; and (b)
makes such electronic communications network service or electronic communications service
available to subscribers for a fee, whether or not such electronic communications network
services or electronic communications services made available by the reseller (i) are identical
to the electronic communications network service or electronic communications service
acquired; (ii) are packaged, bundled or otherwise re-grouped to form new or varied service
offerings; (iii) are combined, linked or used in connection with electronic communications
networks or electronic communications facilities owned by the reseller; and/or (iv) add value to
such electronic communications network services or electronic communications services;
1.59 “SLA”means service level and/or related agreements as described in DFA’s Product Rules
and/or customer agreements or Vumatel Framework Agreements;
1.60 " SMEs" means small and medium businesses, as defined in the Competition Act;
1.61 “Substantial Fibre Infrastructure” means fibre infrastructure that costs more than R15,000
(fifteen thousand Rand) adjusted for inflation annually on the anniversary of the Approval Date
by a percentage equal to the percentage change in the consumer price index, as published by
Statistics South Africa or its successor;
1.62 “Third Party FTTB ISPs” means Licensed ISPs (including ISPs in the Vodacom SA Group)
thatprovideretailFTTBservicestoenterpriseendconsumersandthatmeettheMazivGroup’s
minimum criteria for onboarding;
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1.63 "Third Party FTTB Providers" means Licensed providers of wholesale FTTB Services
(includingentitiesintheVodacomSAGroup,ifany)andthatmeettheMazivGroup’sminimum
criteria for onboarding;
1.64 “Third Party FTTH ISPs” means Licensed ISPs (including ISPs in the Vodacom SA Group)
thatprovideRetailFTTHservicestoendconsumersandthatmeettheMazivGroup’sminimum
criteria for onboarding;
1.65 "Third Party FTTH Providers" means Licensed providers of wholesale FTTH services
(includingentitiesintheVodacomSAGroup,ifany)andthatmeettheMazivGroup’sminimum
criteria for onboarding;
1.66 “Third Party Herotel Resellers” means Licensed or un-Licensed Resellers of Wholesale
HerotelServicesthatmeettheHerotelGroup’sminimumcriteriaforonboarding(includingThird
Party Herotel Resellers in the Vodacom SA Group, if any);
1.67 “Third Party Key Resellers” means Licensed or un-Licensed Resellers of Wholesale Key
Services that meet the Maziv Group’s minimum criteria for onboarding (includingThird Party
Key Resellers in the Vodacom SA Group);
1.68 "Transfer Pricing" means the Maziv Group's internal transfer pricing for Wholesale
Metropolitan Fibre Services, Wholesale FTTH Services, or Wholesale FTTB Services supplied
by the Maziv Group to FTTH Providers, FTTB Providers, FTTB ISPs, FTTH ISPs, or Mobile
Network Operators that are controlled by the Maziv Group;
1.69 “Tribunal” means the Competition Tribunal of South Africa;
1.70 “Trustee Divestiture Period”means a period of following the expiry of the
First Divestiture Period;
1.71 " Underserviced Areas" means areas listed in Annexure A of the Under-serviced Area Definitions
Regulations, 2012 and as contemplated in Vodacom's radio frequency spectrum licence No.:
IMT/AMD/RF0002/November/2023;
1.72 “Vumatel/Herotel Approval Date” means the date of the approval by the Tribunal or the
Competition Appeal Court, as the case may be, of the Vumatel/Herotel Merger;
Competition Appeal Court, as the case may be, of the Vumatel/Herotel Merger;
1.73 “Vumatel/Herotel Implementation Date” means the date after the Vumatel/Herotel Approval
Date on which the Vumatel/Herotel Merger is implemented;
1.74 “Vumatel/Herotel Merger”means the proposed acquisition by Vumatel of more than 50% (fifty
percent) of the issued share capital of Herotel, submitted to the Commission for approval on
30 June 2022 under Commission case number 2022Jun0077;
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1.75 " Vodacom's Competitively Sensitive Information" means Confidential Information belonging
to Vodacom SA Group, the exchange of which could result in a contravention of section 4(1)(a)
or (b) and/or section 5( 1) of the Competition Act, including any and all information relating to:
1.75.1 pricing – including pricing of products, prices/rebates/discounts offered to
customers and/or planned price changes;
1.75.2 customer lists, customer-specific information (including details of customers'
agreements with Vodacom SA and their roll-out plans), data relating to customers
and/or client strategy, specific subscriber contact details;
1.75.3 its business plan;
1.75.4 detailed costs, turnovers, budgets, sales figures in each instance in respect of
particular products and customers;
1.75.5 capacity information, quality of services;
1.75.6 research and development programmes;
1.75.7 margin information of products or in relation to customers;
1.75.8 future rollout plans, future product developments, and/or present or future
technologies to be utilised in such plans or developments; and/or
1.75.9 presentations to any planning committee, including submissions, presentations
and minutes;
1.76 “Vodacom Fixed Mobile Services Rate Card Prices”means prices charged by Vodacom SA
Group for Fixed Mobile Services, as listed on Vodacom SA Group's rate cards;
1.77 " Vodacom FTTH Business” means the FTTH business of Vodacom SA comprised of
Vodacom SA’s FTTH network infrastructure andrelated assets (including contracts and fixed
assets);
1.78 “Vodacom Group" means Vodacom Group Limited;
1.79 " Vodacom SA" means Vodacom Proprietary Limited (for the purposes of clarity a reference to
Vodacom SA shall not include a reference to Vodacom SA's nominated directors appointed to
the Maziv board);
1.80 “Vodacom SA Group” means Vodacom SA, all firms directly or indirectly controlled by
1.80 “Vodacom SA Group” means Vodacom SA, all firms directly or indirectly controlled by
Vodacom SA, all firms directly or indirectly controlling Vodacom SA and all firms directly or
indirectly controlled by the firms that directly or indirectly control Vodacom SA including any
infrastructure companies directly or indirectly controlled by Vodacom SA;
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1.81 " Vodacom Transfer Assets” means Vodacom SA’sfibre infrastructure on metro fibre routes
and FTTB access routes into buildings;
1.82 " Vumatel”meansVumatelProprietaryLimited;
1.83 " Vumatel Framework Agreements”meansstandardisedframeworksforagreementsbetween
Vumatel and ISPs;
1.84 “Wholesale FTTB Services”means wholesale FTTB services provided by the Maziv Group
to Third Party FTTB ISPs or Third Party FTTB Providers (including to the Vodacom SA Group);
1.85 “Wholesale FTTH Services”means wholesale FTTH services provided by the Maziv Group
to Third Party FTTH ISPs (including to the Vodacom SA Group);
1.86 “Wholesale Herotel Services” means wholesale technology-agnostic internet services
provided by the Herotel Group to Third Party ISPs or Third Party Herotel Resellers;
1.87 “Wholesale Key Services”means wholesale technology-agnostic internet services provided
by the Maziv Group to third party ISPs or Third Party Key Resellers (including to the Vodacom
SA Group); and
1.88 “Wholesale Metropolitan Fibre Services” means metropolitan backhaul connectivity which
include connectivity services between one or more data centres, points of presence and base
station towers, FTTS and dark and lit metropolitan backhaul fibre products provided by the
Maziv Group to Third Party FTTH ISPs, Third Party FTTB ISPs, Third Party FTTH Providers,
Third Party FTTB Providers, or Mobile Network Operators anywhere in South Africa and does
not, in respect of any customer, or potential customer (including the Maziv Group or Vodacom
SA Group) include access to infrastructure not provided for in the Product Rules and Vumatel
Framework Agreements (unless the Maziv Group provides access to infrastructure to Vodacom
SA Group, in which case such access to infrastructure shall not be excluded).
2 DURATION AND APPLICATION
2.1 Subject to clause 2.2, the obligations imposed on the Merger Parties in these Conditions will,
unless specified otherwise, apply for as long as Vodacom SA controls Maziv in terms of section
12 of the Competition Act (or until such earlier date on which the subject of any clause is
superseded by legislation or regulation binding on the Maziv Group or Vodacom SA Group that
conflicts with the condition).
2.2 Notwithstanding the provisions of clause 2.1, the public interest Conditions set out in clauses
10 and 15 to 17 shall continue to apply during the time periods set out in those clauses
respectively.
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3 NOTIFICATION OF MERGERS OR TRANSFERS AND RESTRICTIONS
3.1 The Merger Parties shall notify all mergers in respect of which any firm in the Maziv Group is an
acquiring firm or target firm, including small mergers, to the Commission and shall not
implement any such merger until it has been approved by the Commission, Tribunal or
Competition Appeal Court, whichever is the authority of final instance in respect of that merger.
3.2 Maziv shall notify the Commission if the Maziv Group intends to transfer any last mile fibre
assets (including any customer contracts for the supply of Wholesale FTTH Services, or
Wholesale FTTB Services, commercial arrangements, or businesses or parts thereof) to the
Herotel Group post-Approval Date and shall not implement such a transfer without the
Commission’s written consent. This condition shall cease to apply from the Vumatel/Herotel
Implementation Date.
3.3 Vodacom SA and Maziv Group (excluding Herotel Group) shall not use Herotel metropolitan
backhaul, FTTH or FTTB infrastructure to provide Wholesale FTTB Services, Wholesale FTTH
Services, Wholesale Key Services or Wholesale Metropolitan Services, nor shall they sell any
such services through the Herotel Group, unless such services are offered on an open access
basis and on non-discriminatory terms by Herotel Group.
3.4 Vodacom SA and Maziv Group (excluding Herotel Group) shall not procure or receive any
services from Herotel Group unless such services are offered on an open access basis and on
non-discriminatory terms by Herotel Group.
3.5 Vodacom SA and Maziv Group (excluding Herotel Group) shall not provide Wholesale FTTB
Services, Wholesale FTTH Services, Wholesale Key Services or Wholesale Metropolitan
Services through, on, connecting to, or otherwise using the Herotel Group network, unless
access to the Herotel Group network is offered on an open access basis and on non-
discriminatory terms.
discriminatory terms.
3.6 Vodacom undertakes that it will not increase its shareholding in Maziv to beyond 34.95% without
the consent of the Commission.
3.7 Prior to (1) Vodacom beneficially owning more than one half of the issued share capital of Maziv
(thereby acquiring control as contemplated in section 12(2)(a) of the Competition Act), (2)
Vodacom becoming entitled to vote a majority of the votes that may be cast at a general meeting
of Maziv, either directly or through a controlled entity of Vodacom (thereby acquiring control as
contemplated in section 12(2)(b) of the Competition Act) or (3) Vodacom being able to appoint
of veto the appointment of a majority of the directors of Maziv (thereby acquiring control as
contemplated in section 2 (2)(c) of the Competition Act), Vodacom and Maziv shall file and
obtain merger approval from the Competition authorities.
4 OPEN ACCESS
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4.1 Subject to clause 6 below, the Maziv Group may not refuse to offer:
4.1.1 Wholesale Metropolitan Fibre Services to any Third Party FTTH ISP, Third Party
FTTB ISP, Third Party FTTH Provider, Third Party FTTB Provider, or Mobile
Network Operator, if and for as long as it is Reasonably Capable of rendering
such Wholesale Metropolitan Fibre Services in the Ordinary Course of Business
of the Maziv Group;
4.1.2 Wholesale FTTH Services to any Third Party FTTH ISP, if and for as long as it is
Reasonably Capable of rendering such Wholesale FTTH Services in the
Ordinary Course of Business of the Maziv Group;
4.1.3 Wholesale FTTB Services to any Third Party FTTB ISP or Third Party FTTB
Provider, if and for as long as it is Reasonably Capable of rendering such
Wholesale FTTB Services in the Ordinary Course of Business of the Maziv
Group;
4.1.4 Wholesale Key Services to any third party ISP or Third Party Key Reseller for re-
sale, if and for as long as it is Reasonably Capable of offering such Wholesale
Key Services in the Ordinary Course of Business of the Maziv Group; and/or
4.1.5 Wholesale Herotel Services to any third party ISP or Third Party Herotel Reseller
for re-sale, if and for as long as it is Reasonably Capable of offering such
Wholesale Herotel Services in the Ordinary Course of Business of the Herotel
Group.
4.2 Maziv Group shall, for as long as it supplies dark fibre services to Vodacom SA Group, Maziv
Group and/or any other customer in South Africa, not cease to supply dark fibre services to third
parties and shall not terminate any contracts concluded prior to the Implementation Date for the
provision of dark fibre services. Dark fibre services supplied by the Maziv Group to any party
in South Africa shall be provided on an open access and non-discriminatory basis as provided
for in clauses 4.1 above and 5 below. This clause 4.2 shall not prevent the Maziv Group from
for in clauses 4.1 above and 5 below. This clause 4.2 shall not prevent the Maziv Group from
terminating any contract for dark fibre services as a result of breach of the terms of such
contract.
5 NON-DISCRIMINATORY TERMS
5.1 Subject to clause 6 below, the Maziv Group shall provide Wholesale Metropolitan Fibre
Services, Wholesale FTTH Services, Wholesale FTTB Services on terms and conditions,
including prices, which are:
5.1.1 transparent, in that key component elements of the pricing of products are set
out separately in rate cards and, where applicable, reflected in Transfer Pricing
so that it is possible to compare pricing applied to FTTH Providers, FTTB
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Providers, FTTB ISPs, FTTH ISPs, or Mobile Network Operators that operate
within, or are controlled by, the Maziv Group, the Herotel Group, or the Vodacom
SA Group, versus those applied to third parties; and
5.1.2 non-discriminatory, in that the Maziv Group shall (subject to clauses 5.2 and 5.3)
offer standard rate card prices to its third party customers and to the Maziv
Group, the Herotel Group and Vodacom SA Group for equivalent services, and
shall offer the Maziv Group, the Herotel Group and Vodacom SA Group no
advantage in respect of pricing, requisite quality, hand-off locations or
demarcation points, and timelines and security of delivery for the supply of
Wholesale Metropolitan Fibre Services, Wholesale FTTH Services, or Wholesale
FTTB Services.
5.2 The requirements in clause 5.1.2. shall not preclude the Maziv Group from offering prices to its
third-party customers that are lower than the standard rate card prices. The Maziv Group may
therefore charge third party customers less than its rate card prices but may never charge third
party customers more than its rate card prices.
5.3 The requirements in clause 5.1.2. shall not preclude the Maziv Group from offering the Maziv
Group, the Herotel Group or Vodacom SA Group prices that are lower than the standard rate
card prices in instances where discounts are given in order to match a legitimate alternative
competitor quote received by the Maziv Group, the Herotel Group or Vodacom SA Group for
the same product or service, provided that Maziv Group notifies the Commission and the
Monitoring Trustee of such discounted price and provides the Commission and the Monitoring
Trustee with evidence of the alternative competitor quote that the discounted price seeks to
meet. The Maziv Group may therefore only charge Maziv Group, the Herotel Group or
Vodacom SA Group less than its standard rate card prices to match an alternative competitor
Vodacom SA Group less than its standard rate card prices to match an alternative competitor
quote and if Maziv Group has provided evidence of the alternative competitor quote to the
Commission and the Monitoring Trustee.
5.4 Subject to clause 6 below, the Maziv Group shall provide Wholesale Key Services to third party
ISPs and Third Party Key Resellers and Wholesale Herotel Services to third party ISPs and
Third Party Herotel Resellers for re-sale on terms and conditions, including prices, which are:
5.4.1 transparent, so that it is possible to compare pricing applied to ISPs, Herotel
Resellers and Key Resellers that operate within, or are controlled by, the Maziv
Group, the Herotel Group or the Vodacom SA Group, versus those applied to
third parties; and
5.4.2 non-discriminatory, in that the Maziv Group shall offer Wholesale Key Services
to third party ISPs and Third Party Key Resellers and Wholesale Herotel Services
to third party ISPs and Third Party Herotel Resellers at the same price that the
Maziv Group offers Wholesale Key Services to ISPs and Key Resellers or
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Wholesale Herotel Services to third party ISPs and Third Party Herotel Resellers
that operate within, or are controlled by, the Maziv Group, the Herotel Group or
the Vodacom SA Group, and shall offer the Maziv Group, the Herotel Group and
Vodacom SA Group no advantage in respect of pricing, requisite quality, and
timeliness and security of delivery for the supply of Wholesale Key Services or
Wholesale Herotel Services.
5.5 The Maziv Group shall employ best endeavours to ensure that Wholesale Metropolitan Fibre
Services, Wholesale FTTH Services, Wholesale FTTB Services and Wholesale Key Services
are provided to customers (including entities within the Maziv Group) in line with product-
specific terms and conditions, as described in the Product Rules, or Vumatel Framework
Agreements, which require such services to be provided on an equal and non-preferential basis
in respect of:
5.5.1 resolution of logged incidents;
5.5.2 timely access to the network services; and
5.5.3 active service availability
and shall ensure that, if Maziv Group is unable to comply with such product-specific terms and
conditions, as described in the Product Rules, or Vumatel Framework Agreements, that any
such failure to comply is remedied without delay.
5.6 The Maziv Group shall publish its standard Product Rules (including SLA terms) and Vumatel
Framework Agreements on its website within 10 (ten) Business Days of the Implementation
Date and, if the Product Rules or Vumatel Framework Agreements are amended, ensure that
the amended Product Rules or Vumatel Framework Agreements are published on its website
within 10 (ten) Business Days from the amendment having come into effect.
5.7 The Maziv Group shall ensure that compliance with the Product Rules and Vumatel Framework
Agreements is consistently applied and monitored.
5.8 The non-discrimination obligations in this clause 5 apply to all contracts (including proposals
made to third parties participating in a tender process) for the provision of the relevant services
by the Maziv Group that are concluded following the Implementation Date, as well as to all
adjustments to the prices or other terms of all contracts for the provision of the relevant services
by the Maziv Group that are made by the Maziv Group after the Implementation Date, in respect
of contracts concluded before or after the Implementation Date.
6 EXCLUSIONS
6.1 The open access Conditions in clause 4 and the non-discrimination clause in 5 shall not be
interpreted to create any obligation on the Maziv Group to supply Wholesale Key Services,
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Wholesale Metropolitan Fibre Services, Wholesale FTTH Services, or Wholesale FTTB
Services to any third party who refuses or fails to adhere to the general commercial terms
subject to which the services are offered, or who commits a breach of the terms subject to which
the services are rendered.
6.2 Other than the Condition in clause 4.1.5, the open access Conditions in clause 4 shall not apply
to the Herotel Group either before or after the Vumatel/Herotel Implementation Date.
6.3 The open access Condition in 4.1.5 and the non-discrimination Conditions in clause 5.4 shall
not apply until 6 (six) months after the Vumatel/Herotel Implementation Date.
7 EXPANSION PLANS
7.1 Maziv Group shall publish all relevant information (comprising live, work in progress and
planned routes (i.e. routes that will be constructed)) about all of its own metropolitan (including
FTTS), FTTB and FTTH fibre infrastructure network expansion programmes on its website at
least every second week, without providing this information to the Vodacom SA Group, Herotel
Group ortheMazivGroup’sownFTTHproviders, FTTB providers, FTTS providers or ISPs prior
to publication on the website.
7.2 For the avoidance of doubt, this obligation does not require Maziv Group to publish plans to
buildinfrastructurespecificallyinordertoserveathirdpartycustomer’sexpansionplans. Such
build plans will constitute Confidential Information and will be protected by Maziv Group’s
obligations in clauses 14.4and 14.5.
8 DIVESTITURE OF WHOLESALE FIBRE INFRASTRUCTURE
8.1 In all areas, including suburbs, estates, or business parks, where Vodacom SA Group has rolled
out infrastructure which: (i) has overbuilt Maziv Group FTTH infrastructure as at the Implementation
Date, (ii) is being transferred to Maziv in terms of the Merger; and (iii) Vodacom SA is using to
provide Wholesale FTTH Services as at the Implementation Date, the Merger Parties shall apply
provide Wholesale FTTH Services as at the Implementation Date, the Merger Parties shall apply
good faith and best endeavours to, by the end of the First Divestiture Period, conclude one or
more Divestiture Agreements, with one or more Purchasers.
8.2 Maziv and/or Vumatel must conduct the Divestiture subject to a transparent and competitive
bidding process to facilitate broad participation by prospective Purchasers.
8.3 If Maziv or Vumatel is not able to conclude the Divestiture Agreement(s) for the Divestiture
within the First Divestiture Period, the Monitoring Trustee will have an exclusive mandate and
a power of attorney to, during the Trustee Divestiture Period, conclude one or more Divestiture
Agreement(s), with one or more Purchasers.
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8.4 The Monitoring Trustee shall, during the Trustee Divestiture Period have sole discretion to
determine fair value for the overlapping infrastructure and whether the Monitoring Trustee
accepts an offer from any Purchaser shall not require engagement with, or be subject to, the
input of the Merger Parties.
8.5 A Purchaser of the overlapping infrastructure referred to in clause 8.1 shall be a firm:
8.5.1 that does not own FTTH infrastructure that overlaps with FTTH infrastructure
being purchased; and
8.5.2 that is independent from, and unrelated to, either of the Merger Parties.
8.6 Once a Divestiture Agreement has been concluded, the parties to that Divestiture Agreement
must use their reasonable commercial endeavours to ensure that the Divestiture Agreement
becomes unconditional and that it is implemented as soon as practical after the date of
signature of the Divestiture Agreement, subject to any regulatory approvals which may apply.
This shall be included as a provision in each Divestiture Agreement.
8.7 The Divestiture (or any part thereof) must be notified to the Commission, in the prescribed form,
as a merger, prior to its implementation and irrespective of whether the mandatory thresholds
for notification of mergers contemplated by the regulations to the Act, are met.
8.8 Maziv shall, from the Implementation Date until the overlapping infrastructure referred to in
clause 8.1 has been sold:
8.8.1 preserve and maintain the the overlapping infrastructure referred to in clause 8.1;
8.8.2 manage the overlapping infrastructure referred to in clause 8.1 with reasonable
care and skill, pursuant to good business practices.
9 PRICING OF LOWEST PRICED WHOLESALE FTTH SERVICES AND WHOLESALE KEY
SERVICES
9.1 Maziv shall, for a period of from the Implementation Date, not cease to offer for
sale (i) its lowest priced Wholesale FTTH Service in Reach Areas, or (ii) its lowest priced
sale (i) its lowest priced Wholesale FTTH Service in Reach Areas, or (ii) its lowest priced
Wholesale Key Service in Key Areas, that are on offer as at the Approval Date, however, if
market conditions change to such an extent that it becomes impossible for Maziv to comply with
the conditions in this clause 9.1, Maziv shall be permitted to approach the Commission for a
variation of the conditions in this clause 9.1.
9.2 Maziv shall, for a period of from the Implementation Date, not increase the price
of (i) its lowest priced Wholesale FTTH Service in Reach Areas, or (ii) its lowest priced
Wholesale Key Service in Key Areas, as at the Approval Date,
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10 VODACOM SA GROUP ROLL-OUT COMMITMENTS
10.1 Vodacom SA Group shall spend at least R60,000,000,000 (sixty billion Rand) in Capex in South
Africa over a 5 (five) year period from the Implementation Date at a rate of approximately
R12,000,000,000 (twelve billion Rand) per annum, including for the roll out of no less than 564 (five
hundred and sixty-four) 5G sites in South Africa on average per annum.
10.2 Vodacom SA Group currently offers 5G FWA in all areas where 5G is available and intends to
continue this policy. Consequently, wherever Vodacom SA Group continues to roll out 5G
infrastructure, Vodacom SA Group shall offer 5G FWA immediately, at competitive pricing.
Furthermore, Vodacom SA undertakes (1) to achieve 90% 5G population coverage within 5 years
of the Approval Date and (2) to add an additional FWA and/or
100 Gig connections by the end of 2030 (for the purposes of this clause "100 Gig" connections are
packages of 100 Gigs or more per month). A variation will permitted in respect
of such FWA and/or 100 Gig connections, provided that the
variation is caught up by 31 December 2031)
10.3 Vodacom SA Group undertakes that during each year until March 2030, measured at the end of
March 2025, and each anniversary thereof, it shall roll out no less than 200 5G sites annually in
Underserviced Areas.
10.4 Vodacom SA shall provide mobile broadband access to the 100 police stations listed in Appendix
"D" as well as to 1573 Healthcare Facilities (i.e. Government clinics and Government hospitals)
and 210 libraries on the terms contemplated in Vodacom 2024 Spectrum Licence (clause 1.3.5 of
Radio Spectrum Licence No.: IMT/AMD/RF0002/November/2023) through FWA router/s with a
bundle of 500GB zero-rated data free of charge, subject to the fair usage restriction contained in
the applicable terms and conditions, as soon as practically possible but in any event by no later
than 2 (two) years after the Implementation Date, in the case of the 100 police stations and, in the
case of the Healthcare Facilities and libraries, within the period contemplated in the Vodacom 2024
Spectrum Licence.
11 VODACOM SA NOMINEES ON MAZIV GROUP BOARDS AND INDEPENDENT DIRECTORS
11.1 For as long as Vodacom SA can appoint or nominate individuals to the board of directors of any
entity within the Maziv Group, it shall ensure that its appointees or nominees shall not include
Excluded Employees, or individuals who have been Excluded Employees in the 2 (two) years
preceding their appointment or nomination and will notify the Commission of the identity of each
individual appointed or nominated to the board of directors of any entity within the Maziv Group
within 10 (ten) Business Days of such appointment or nomination.
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11.2 Vodacom SA and CIVH agree that an additional independent director shall be added to Maziv's
board of directors (increasing the number of independent directors from 3 (three) to 4 (four) in
terms of clause 6.2.5.1 of the MOI).
11.3 The number of independent directors on the nominations committee of the Maziv board shall
be increased from one to two (as per clause 6.3.17.1 (b) of the MOI).
11.4 Vodacom SA, as shareholder, shall not be entitled to approve or veto the appointment of the
nomination of the independent directors appointed to the Maziv board as is currently the case
in terms of clause 6.2.5.4 of the MOI.
11.5 The MOI shall within 10 (ten) Business Days of the Approval Date be amended to provide for
the conditions set out in clauses 11.3 to 11.4.
12 RESTRICTIONS REGARDING RESERVED MATTERS AND VODACOM SA SHAREHOLDER
REPRESENTATION
12.1 With reference to Vodacom SA’s representation at Maziv shareholder meetings, clause
6.2.6.1(a) of the MOI shall, within 10 (ten) Business Days of the Approval Date, be amended to
provide that no person serving as a director on any Maziv Group entity’sboard of directors shall
be entitled to be a Vodacom SA representative at Maziv shareholder meetings.
12.2 Vodacom SA’s veto right in respect of any Maziv Group entity’sbusiness plan and budget, as
provided for in Schedule 2 of MOI, shall be restricted in that Vodacom may only use such veto
in instances where the proposed business plan and budget would result in an impairment of
Vodacom’sinvestmentinMaziv.
12.3 Vodacom SA shall not use its veto right in respect of any Maziv Group entity’s business plan
and budget, as provided for in Schedule 2 of MOI to restrict the capital expenditure of Maziv to
below the numbers reflected in the Vodacom SA projected business plan and/or budget for
Maziv (as provided to the Commission by Vodacom SA on 3 July 2025), however, if there is a
Maziv (as provided to the Commission by Vodacom SA on 3 July 2025), however, if there is a
fundamental change in the performance of Maziv's business, Vodacom will be permitted to
approach the Commission for a variation of the condition in this clause 12.3.
12.4 In an event, where Vodacom SA exercises its veto in respect of any such entity’sbusiness plan
and budget, the relevant Maziv Group entity’sboard shall present a plan to the satisfaction of
controlling shareholders of Maziv for the preservation of the value of Maziv..
12.5 In addition, until such time as every controlling shareholder of Maziv has confirmed its support
for the relevant Maziv Group entity’sbusiness plan and budget, that entity shall continue to
operate with the latest proposed business plan and budget recommended by the relevant board
for shareholder approval.
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12.6 The MOI shall within 10 (ten) Business Days of the Approval Date be amended to provide for
the conditions set out in clauses 12.2 to 12.5 above.
12.7 For as long as Vodacom SA is a Maziv shareholder, Vodacom SA shall only be entitled to
receive a redacted version of any proposed or approved budget and business plan of any Maziv
Group entity in respect of which all detailed product-planning, product or customer-specific
pricing and detailed roll-out plans have been removed.
12.8 Accordingly, a definition of "Vodacom SA Redacted Budget and Business Plan" shall within 10
(ten) Business Days of the Approval Date be inserted into Schedule 2 of the MOI (and shall
remain there for as long as Vodacom SA remains a shareholder of Maziv) which reads as
follows: "Vodacom SA Redacted Budget and Business Plan" shall mean any proposed or
approved budget and business plan of the Company and/or the Group and/or any Group
Member, which, if provided to Vodacom SA Group, shall be redacted to exclude product-
planning, product- or customer-specific pricing and detailed roll-out plans in respect of any
markets (or areas such as suburbs, estates or business parks) for FTTH/B fibre or specific
routes for metro and backhaul fibre.
12.9 When any Maziv Group entity prepares and adopts any budget and business plan and shares
it with Vodacom SA (in its capacity as a shareholder of Maziv), it must do so in a manner that
is compliant with these Conditions.
13 FIXED MOBILE SERVICES PROVIDED BY VODACOM SA GROUP TO THE MAZIV GROUP
13.1 Vodacom SA Group shall from Implementation Date not provide Fixed Mobile Services to any
party on wholesale terms that are discriminatory, i.e. such terms and conditions shall be the
same (including in respect of pricing, requisite quality, and timeliness and security of delivery)
as those offered to the Maziv Group, Herotel Group or any related entity for the supply of Fixed
Mobile Services of like grade and quality and in equivalent transactions and measured on an
aggregated basis per product category, per customer.
13.2 Vodacom SA Group shall from Implementation Date and for as long as Vodacom SA Group
controls Maziv, only provide Fixed Mobile Services to the Maziv Group and Herotel Group at
Vodacom Fixed Mobile Services Rate Card Prices, unless Vodacom SA notifies the
Commission and the Monitoring Trustee of its intention to provide bespoke (customer-specific)
Fixed Mobile Services to the Maziv Group or Herotel Group.
13.3 From Implementation Date and for as long as Vodacom SA Group controls Maziv, if Vodacom
SA Group provides bespoke (customer-specific) Fixed Mobile Services to the Maziv Group or
Herotel Group, such bespoke (customer-specific) Fixed Mobile Service shall also be offered to
third parties and will be added to Vodacom SA's rate card within 10 (ten) Business Days of
being sold and Vodacom SA shall notify the Commission and the Monitoring Trustee that such
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services have been added to the rate cards withing 5 (five) Business Days of adding the
services to the rate cards.
14 CONFIDENTIALITY OF INFORMATION
14.1 Other than to comply with its obligations under clause 7, Maziv Group shall not, for as long as
Vodacom SA is a shareholder of Maziv, discuss, disclose or share Maziv’s Competitively
Sensitive Information or Herotel Competitively Sensitive Information (if in Maziv Group's
possession) in any form with Vodacom SA or any employee, representative or member of a
division or firm within Vodacom SA Group (however such Competitively Sensitive Information
may be shared with the appointed or nominated directors of Vodacom SA, subject to the
provisions of the Confidentiality Undertaking referred to in clause 14.3 below).
14.2 For as long as Vodacom SA is a shareholder of Maziv, neither Vodacom SA, nor any Vodacom
SA appointed or nominated director shall discuss, disclose or share Vodacom’s Competitively
Sensitive Information in relation to any company in the Vodacom SA Group (excluding the Maziv
Group) in any form with Maziv or Herotel, or any employee, representative, or member of a
division or firm within the Maziv Group or Herotel Group, other than to the extent that it is
necessary for such information to be shared in order for a firm in the Maziv Group or Herotel
Group to provide products or services to Vodacom SA Group.
14.3 The appointed or nominated directors of Vodacom SA contemplated in clause 11.1 shall be
required to sign a Confidentiality Undertaking in favour of Maziv and Vodacom SA in which each
such director undertakes not to divulge to:
14.3.1 Maziv Group or employees of Maziv Group any of Vodacom’s Competitively
Sensitive Information;
14.3.2 Vodacom SA or any employee, representative or member of a division or entity
within the Vodacom SA Group any Confidential Information relating to third
within the Vodacom SA Group any Confidential Information relating to third
parties (including current and/or future expansion plans) that is disclosed to the
Vodacom SA appointed or nominated director by the Maziv Group; and
14.3.3 Vodacom SA or any employee, representative or member of a division or entity
within the Vodacom SA Group anyofMaziv’sCompetitivelySensitiveInformation
that is disclosed to the Vodacom SA appointed or nominated director by the
Maziv Group.
14.4 Maziv Group shall, for as long as Vodacom SA is a shareholder of Maziv, use Confidential
Information obtained by it from any party contracting with Maziv exclusively for the purpose of
servicing such Third Party.
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14.5 Maziv Group will, for as long as Vodacom SA is a shareholder of Maziv, procure that any
Confidential Information it receives from any third party contracting with Maziv, including current
and/or future expansion plans, is not divulged by Maziv Group to:
14.5.1 Any firm, entity, business unit or division (or employee, representative or member
of such firm, entity, business unit or division) of Maziv Group that competes with
such third party contracting with Maziv;
14.5.2 Herotel Group; or
14.5.3 Vodacom SA Group or any employee, representative or member of a division or
entity within Vodacom SA Group (however, such Confidential Information may
be shared with the appointed or nominated directors of Vodacom SA, subject to
the provisions of the Confidentiality Undertaking referred to in clause 14.
15 EMPLOYMENT
15.1 Employment Guarantee
15.1.1 Maziv Group and Vodacom SA Group shall not retrench any Affected Employee
as a result of the Merger for a period of 5 (five) years from the Implementation
Date.
15.1.2 For the avoidance of doubt, retrenchments do not include (i) voluntary separation
arrangements; (ii) voluntary early retirement packages; (iii) unreasonable
refusals to be redeployed in accordance with the provisions of the Labour
Relations Act 66 of 1995 (“LRA”); (iv) resignations or retirements in the normal
course; and (v) terminations in the normal course of business, including
dismissals as a result of misconduct or poor performance, and necessary steps
taken by Maziv Group and/or Vodacom SA Group in terms of section 189 or 189A
of the LRA, should operational requirements in the Ordinary Course of Business
that are not merger specific (i.e. not related to or as a result of the Merger)
necessitate that such steps be taken.
15.2 Headcount Maintenance
15.2.1 Maziv shall ensure that Vumatel and DFA and their wholly owned subsidiaries
15.2.1 Maziv shall ensure that Vumatel and DFA and their wholly owned subsidiaries
shall maintain the total aggregate number of all Employees of Vumatel and DFA
and their wholly owned subsidiaries as at the Approval Date, for a period of
5 (five) years from the Approval Date.
15.2.2 Should there, during such 5 (five) year period, be job losses in respect of
Employees of Vumatel, DFA or their wholly owned subsidiaries that are unrelated
the Merger, including dismissals as a result of poor performance, resignations
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and/or retirements in the normal course of business, Maziv shall ensure that
Vumatel and/or DFA and/ or the relevant subsidiaries replace such Employees
within a reasonable time period (which shall not exceed 6 (six) months after the
job loss in question) in order to maintain the aggregate headcount referred to in
clause 15.2.1.
16 HEAD OFFICE
16.1 For a period of 7 (seven) years from the Implementation Date, Maziv shall remain incorporated
and headquartered in South Africa and place operational and strategic responsibility in the
hands of local management in South Africa. Maziv shall remain a tax resident of South Africa.
17 PUBLIC INTEREST
17.1 B-BEEE
17.1.1 Vodacom SA and CIVH shall:
17.1.1.1 take all such steps as are necessary to ensure that the B-BBEE Ownership
Status in Maziv shall not be less than on the Implementation Date;
17.1.1.2 for a period of at least from the Implementation Date, Vodacom
SA and CIVH shall not dispose of or dilute their shareholding in Maziv (other than
in respect of a listing of the shares of Maziv on the JSE) such that the B-BBEE
Ownership Status in Maziv shall be reduced below .
17.1.2 For a period of from the Implementation Date, or for as long as
they are shareholders of Maziv (whichever is the shortest period), Vodacom SA
and CIVH shall ensure that the Maziv MOI will require every Maziv shareholder
to achieve and maintain a B-BBEE Ownership Status of at least
measured in terms of the ICT Sector Codes (but excluding the modified
flow through principle).
17.1.3 A Defaulting Shareholder shall promptly notify Maziv and the other Maziv
shareholders in writing that it has become a Defaulting Shareholder and it shall
be allowed the longer of:
, to remedy the breach. In addition, the Defaulting Shareholder shall:
17.1.3.1 at inception of the remedy period, provide Maziv with a written plan which sets
17.1.3.1 at inception of the remedy period, provide Maziv with a written plan which sets
out its plan to increase its B-BBEE Ownership Status by the next annual expiry
of Maziv's current B-BBEE verification certificate to at least
; and
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17.1.3.2 at the end of each calendar month during the remedy period, provide Maziv with
a written report recording all progress made by that Defaulting Shareholder to
remedy its breach.
17.1.4 If the Defaulting Shareholder fails to remedy its breach within the period
contemplated in clause 17.1.3and, as a result of such breach Maziv's B-BBEE
Ownership Status measured in accordance with clause 17.1.2remains below
30% (thirty per centum), then Vodacom SA, Maziv and CIVH shall take all
necessary steps to ensure that a solution is implemented that will result in Maziv
achieving at least a B-BBEE Ownership Status within
the shortest time possible in accordance with a practical and reasonable
timetable determined by the Maziv board of directors in consultation with the
DTIC.
17.1.5 If the remedy contemplated in clause 17.1.3 to 17.1.4 is successfully
implemented in accordance with the provisions set out above, the temporary
reduction in B-BEE Ownership shall not constitute a breach of these Conditions.
However, if the remedy is not fully and successfully implemented in accordance
with the abovementioned provisions set out above, this will constitute a material
breach of these Conditions without the further opportunity to remedy it.
17.1.6 Maziv shall improve its current B-BBEE Score Card rating in terms of the ICT
Sector Codes from its current to a B-BBEE Score Card
rating within of the Implementation Date and thereafter maintain
such rating for a period of at least after the Implementation Date,
subject thereto that the ICT Codes are not amended to make the achievement of
such level more onerous than as at the Approval Date.
17.2 Services to Schools, Libraries and Clinics
17.2.1 For a period of from the Implementation Date, the Maziv Group
shall provide free uncapped access to Wholesale FTTH Services
for every public library or public clinic and every public or private, ((i) pre-primary
for every public library or public clinic and every public or private, ((i) pre-primary
school which forms part of and resides on the property of a qualifying primary
school, (ii) primary school, (iii) high school, and (iv) special needs school) it
passes provided they are registered with the relevant government authority
(collectively "School"). The Maziv Group shall provide the aforementioned
access to the extent that:
17.2.1.1 new service activation will only require the installation and/or connection of a
drop cable from the public library, public clinic, or School's passed point (e.g.
fibre-pedestal, manhole, chamber, utility-pole) to the public library, public clinic,
or School; and
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17.2.1.2 the connection will not require installation of Substantial Fibre Infrastructure per
public library, public clinic, or School such as feeder and distribution fibre cables
to reach the public library, public clinic, or School.
17.2.2 The free service referred to in clause 17.2.1 shall include the installation and/or
connection of a drop cable from the public library, public clinic, or School's
passed point (e.g. the point where the Maziv Group's relevant fibre-pedestal,
manhole, chamber and/ or utility-pole is located) to the School's premises.
17.2.3 For the avoidance of doubt, the reference to Schools passed shall include public
schools that DFA provides lit FTTS for.
17.2.4 Without derogating from the generality of clause 17.2.1, the Maziv Group shall
within a period of from Implementation Date, connect at least
Schools in addition to the Schools connected as
at the Implementation Date on the basis set out in that clause.
17.2.5 The Maziv Group shall take all such steps as may be necessary to ensure that
one or more ISPs to whom it renders Wholesale FTTH Services, shall provide
Retail FTTH services to the public library, public clinic, or Schools referred to in
17.2.1 free of any charge, fee, compensation or commission, including
installation of subscriber equipment at the public library, public clinic, or Schools,
which comprise a working Wifi-router and internet connection.
17.2.6 For the purpose of this clause 17.2 the terms "passed" and "passes" shall have
the same meaning as set out in clause 17.5.6.
17.3 Enterprise and Supplier Development Fund
17.3.1 Maziv shall establish an Enterprise and Supplier Development Fund and, subject
to clause 17.3.3, contribute a total amount of R400,000,000 (four hundred million
Rand) to such fund over a period of from the Implementation Date,
at a rate of per annum.
Rand) to such fund over a period of from the Implementation Date,
at a rate of per annum.
17.3.2 The R400,000,000 (four hundred million Rand) that shall be contributed by the
Maziv Group shall be fully disbursed within from the Implementation
Date. The Enterprise and Supplier Development Fund shall be disbursed on
various initiatives including, inter alia:
17.3.2.1 meeting Maziv’sobligationsunderclause17.4.2;
17.3.2.2 research and development initiatives in respect of South African suppliers in the
telecommunications sector;
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17.3.2.3 paying for business support and/or coaching services rendered to SME and HDP
owned vendors in the telecommunications sector; and
17.3.2.4 supporting development and training of SMEs including in respect of business
accounting, finance, planning, strategy, communications, advertising,
governance and human resources.
17.3.3
.
17.3.4 For the avoidance of doubt, the amounts to be contributed and disbursed by the
Enterprise and Supplier Development Fund ( ) shall be
incremental to any Committed Expenditure on the part of the Maziv Group. In
particular, such expenditure shall be over and above any pre-existing planned
enterprise and supplier development expenditure as aligned with the ICT Sector
Code on the part of the Merger Parties.
17.3.5 Administration fees or other similar costs of no more than
in total may be deducted from the aggregate value of the Enterprise
and Supplier Development Fund during the period referred to in clause
17.3.2.
17.4 Downstream Agreements
17.4.1 For a period of from the Implementation Date, as it builds
infrastructure into new Lower Income Areas, the Maziv Group shall continue to
work with local contractors and distributors driving their involvement in the
infrastructure build and fibre uptake process.
17.4.2 In particular, within from the Implementation Date, the Maziv
Group undertakes, that 10,000 (ten thousand) direct or indirect employment
opportunities shall be created or enabled through the introduction of an Internet
Retailer distribution model for services in Lower Income Areas.
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17.5 Merger Specific Capex
17.5.1 The Maziv Group shall invest or spend cumulative Capex of at least
R12,000,000,000, (twelve billion Rand) (including capitalised internal costs and
maintenance Capex) over a period of 5 (five) years from 1 April 2025, provided
that where Capex is used to acquire one or more businesses, such businesses
should be of the kind that will enhance localisation in South Africa. A
variation will be permitted in respect of such R12,000,000,000 (twelve
billion Rand), provided that the variation is caught up by ).
17.5.2 The Capex amount referred to in clause 17.5.1 will not include acquisition costs
of the Vumatel/Herotel Merger.
17.5.3 Over a period of from no less than
of the Capex amount referred to in clause 17.5.1 will be spent
on the roll-out of new FTTB, FTTH and FTTS projects, or the acquisition of
businesses by the Maziv Group.
17.5.4 The Capex amount referred to in clause 17.5.1 will be primarily, but not
exclusively, spent on rollout of infrastructure in Lower Income Areas.
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17.5.5 For the avoidance of doubt, the obligations in clauses 17.5.1 to 17.5.4 above place
no limit on Maziv Group’s total Capex spend and do not limit Maziv Group’s Capex
spend on maintenance during the period of from to
or less. Maziv Group may therefore over the
period of from spend any amount necessary to maintain its
existing infrastructure, in addition to spending at least
on the roll-out of new FTTB, FTTH and FTTS projects, or the acquisition of
businesses.
17.5.6 Capex spend will result in at least 1,000,000 (one million) homes in Lower Income
Areas being passed with fibre infrastructure on a cumulative basis within a period of
5 (five) years from 1 April 2025 (which homes were not already passed as at 31 March
2025). Maziv Group will ensure that no less than
homes in Lower Income Areas are passed with fibre infrastructure, per
year, for the five-year period from 1 April 2025 to 31 March 2030 (which homes were
not already passed as at ). For the purpose of this clause 17.5.6, the
term homes "passed" means homes which the Maziv Group has the capability to
technically and legally connect to an FTTH network in a service area (i.e. new service
activation in respect of such home will require only the installation and/or connection
of a drop cable from the homes passed point (e.g. fibre pedestal, manhole, chamber,
utility-pole) to the home and the installation of subscriber equipment at the home such
that the home is capable of connecting. For the avoidance of doubt, this definition
excludes homes that cannot be connected without further installation of substantial
fibre plant such as feeder, distribution cables and active equipment to reach the area
in which a potential new subscriber is located.
17.5.7 Of the 1,000,000 (one million) homes passed referred to in 17.5.6 at least
will be homes passed in Key Areas.
will be homes passed in Key Areas.
17.5.8 If the Capex amount referred to in 17.5.1 is not sufficient to pass the homes that Maziv
Group is required to pass to comply with clause 17.5.6 read with 17.5.7, Maziv Group
will spend such additional Capex as is required to ensure compliance with clauses
17.5.6 and 17.5.7.
17.5.9 For the five-year period from 1 April 2025 to 31 March 2030, Maziv Group will also
provide sufficient Capex to ensure that every home passed in terms of clause 17.5.6
and 17.5.7 that wishes to be connected on the prevailing terms and conditions for
connection, is connected.
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17.5.10 The Capex that Maziv Group is required to spend to comply with the conditions in
clauses 17.5.3, 17.5.5, 17.5.6 and 17.5.7 shall not include Capex spent by Herotel
Group and for purposes of calculating the number of homes to be passed in terms of
clauses 17.5.6 and 17.5.7, the homes passed by the Herotel Group as at the
Implementation Date shall not be included.
17.5.11 Homes that have been passed, at Implementation Date, by the Vodacom FTTH
business that is being transferred to Maziv Group in terms of the Merger, shall not be
included in the homes passed referred to in clause 17.5.6.
17.5.12 For clarity, where a block of flats is passed, the number of homes passed shall be
counted as the number of flats in such block.
17.6 Connectivity in Lower Income Areas
17.6.1 Maziv undertakes that by 31 March 2030, it will achieve an average connection rate
across existing and new infrastructure in Lower Income Areas (where connections
include connections through third parties and Maziv Group businesses) of at least:
17.6.1.1 in Reach Areas; and
17.6.1.2 in Key Areas (however, in respect of such average connection rate of
in Key Areas, variation will be permitted, to
, provided that the variation is caught up by .
17.6.2 If market conditions change fundamentally, making it impossible for Maziv to comply
with 17.6.1.1 and/or 17.6.1.2 Maziv shall be permitted to engage with the Commission
for a variation in respect of the average connection rates set out in 17.6.1.1 and/or
17.6.1.2.
17.7 Local Procurement and HDP Suppliers
17.7.1 For a period of from the Implementation Date, Maziv Group shall,
inter alia and on a non-exclusive basis, use HDP suppliers for network build
contracts, if HDP suppliers offer the requisite network build contracts at the
appropriate quality standards and on reasonably competitive commercial terms.
appropriate quality standards and on reasonably competitive commercial terms.
17.7.2 During the 2022 financial year, the Maziv Group's estimated procurement spend
on goods manufactured and assembled in and services provided in South Africa
consisted of approximately 60% (sixty per centum) out of its total procurement
spend (measured by the Rand value of goods and services in South Africa
against the Rand value of total goods and services), equivalent to approximately
("Benchmark Ratio").
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17.7.3 The Maziv Group undertakes to increase its procurement spend on goods
manufactured and assembled in and services provided in South Africa from the
Benchmark Ratio to at least within a period of
from the Implementation Date.
17.7.4 In relation to the procurement contemplated in this clause 17.7 , Maziv shall
maximise where reasonable, and practically feasible, having regard to the
technical nature of the goods and services required, the procurement of goods
and services from SMEs and HDPs in South Africa.
17.7.5 To the extent that it is reasonably possible, in cases where third parties supply
goods and services into Maziv's value chain, Maziv shall engage with such third-
party suppliers to encourage them to commit to sourcing their goods and/or
services from South African based suppliers.
17.8 Employee Benefit Scheme
17.8.1 Maziv shall within after the Implementation Date,
implement an Employee Benefit Scheme in accordance with the key design
principles set out in Appendix C.
18 APPOINTMENT OF MONITORING TRUSTEE
18.1 Maziv shall, with the prior written approval of the Commission, appoint a Monitoring Trustee to
carry out the Monitoring Trustee Mandate.
18.2 The Monitoring Trustee shall be independent of the Merger Parties, possess the necessary
qualifications and resources to carry out the Monitoring Trustee Mandate and shall at the date
of appointment not be exposed to any conflict of interest.
18.3 MazivshallproposeaMonitoringTrusteefortheCommission’swrittenapprovalwithin10(ten)
Business Days of the Implementation Date.
18.4 The proposal shall contain such information as may enable the Commission to determine
whether or not the proposed Monitoring Trustee is suitable to execute the Monitoring Trustee
Mandate and shall include the proposed Monitoring Trustee’s contact details,employment
history and details regarding the Monitoring Trustee and the Monitoring Trustee’s team’s
history and details regarding the Monitoring Trustee and the Monitoring Trustee’s team’s
relationship (if any) with the Merger Parties for the 12 (twelve) months prior to the Approval
Date.
18.5 The Commission shall have the discretion to canvass the views of participants in the merger
proceedings and to approve or reject the appointment of the proposed Monitoring Trustee.
Such approval or rejection shall be made in writing and provide reasons for the Commission’s
decision. Approval shall not be unreasonably withheld.
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18.6 Maziv shall appoint the proposed Monitoring Trustee within 5 (five) Business Days of receiving
theCommission’sapprovalofsuchproposed appointment.
18.7 If the appointment of the proposed Monitoring Trustee is rejected by the Commission, Maziv
shall submit the names of at least 2 (two) more proposed Monitoring Trustees within 5 (five)
BusinessDays ofbeinginformed oftheCommission’s rejection.
18.8 If the Commission, acting reasonably and following the process outlined in 18.5 above, rejects
all further proposed Monitoring Trustees, the Commission shall nominate a Monitoring Trustee,
whom Maziv shall appoint, or cause to be appointed, within 5 (five) Business Days of being
informedbytheCommissionofsuch Monitoring Trustee’sidentity.
18.9 Mazivshallpay the fees andexpenses of theMonitoring Trusteeandthe MonitoringTrustee’s
team on the terms and conditions agreed upon in writing between Maziv and the Monitoring
Trustee, provided that such terms and conditions do not in any way impede the Monitoring
Trustee from exercising its mandate as agreed with the Commission.
18.10 The Monitoring Trustee shall have the right to request any information that it deems necessary
to execute its mandate.
19 MONITORING OF COMPLIANCE WITH CONDITIONS
19.1 Maziv shall inform the Commission and the Monitoring Trustee of the Implementation Date
within 5 (five) Business Days of it becoming effective.
19.2 Within 5 (five) Business Days of the Implementation Date, Maziv shall provide the Commission
and the Monitoring Trustee with a copy of the Confidentiality Undertakings referred to in
clause 14.3 signed by each Vodacom SA appointed or nominated director and, for as long as
Vodacom SA nominates directors to the Maziv board, Maziv shall, on an annual basis, within
90 days of the anniversary of the Implementation Date, submit to the Commission and the
90 days of the anniversary of the Implementation Date, submit to the Commission and the
Monitoring Trustee an affidavit deposed to by each Vodacom SA appointed or nominated
director confirming awareness of and compliance with, and disclosing any non-compliance with,
the Conditions.
19.3 Maziv shall:
19.3.1 provide the Commission and the Monitoring Trustee with copies of its Product
Rules, including their SLAs terms and Vumatel Framework Agreements within 5
(five) Business Days of the Implementation Date; and
19.3.2 for as long as Vodacom SA controls Maziv, advise the Commission and the
Monitoring Trustee if any non-trivial amendments are made to the Product Rules,
including their SLA terms and Vumatel Framework Agreements, and shall
provide the Commission and the Monitoring Trustee with a copy of the amended
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Product Rules, including their SLA terms and Vumatel Framework Agreements
within 5 (five) Business Day of such amendments coming into effect.
19.4 Maziv shall furnish the Commission and the Monitoring Trustee with a copy of the MOI within
15 (fifteen) Business Days after Implementation Date.
19.5 Within 1 (one) month of the Implementation Date Maziv shall notify existing customers who
procure Wholesale Key Services, Wholesale Metropolitan Fibre Services, Wholesale FTTH
Services, or Wholesale FTTB Services from Maziv Group at the Implementation Date of these
Conditions and shall place a non-confidential version of the Conditions on its website.
19.6 If Maziv asserts an inability or unwillingness to provide access to Wholesale Key Services,
Wholesale Metropolitan Fibre Services, Wholesale FTTH Services, Wholesale FTTB Services,
in terms of 4.1, it shall for as long as Vodacom SA controls Maziv:
19.6.1 notify the Commission and the Monitoring Trustee of any formal written
complaintsreceivedfromcustomerspertainingtoMaziv’sassertionthatMazivis
unable to provide access within 14 (fourteen) Business Days of receiving the
formal written complaint from the customer; and
19.6.2 on request from the customer, and within 10 (ten) Business Days of receiving the
request from the customer, provide detailed and specific written reasons to the
affectedcustomer, Monitoring Trusteeand the Commission, for Maziv’s inability
or unwillingness to provide access.
19.7 For as long as Vodacom SA controls Maziv, Maziv shall publish any changes to its prices for
Wholesale Key Services, or rate cards for Wholesale Metropolitan Fibre Services, Wholesale
FTTH Services and Wholesale FTTB Services, within 10 (ten) Business Days of such changes
coming into effect and provide a written explanation to the Commission and the Monitoring
Trustee, of changes to its prices for Wholesale Key Services or its rate card for Wholesale
Trustee, of changes to its prices for Wholesale Key Services or its rate card for Wholesale
Metropolitan Fibre Services, Wholesale FTTH Services and Wholesale FTTB Services within
20 (twenty) Business Days of such changes coming into effect.
19.8 The Maziv Group shall for as long as Vodacom SA controls Maziv, notify the Commission and
the Monitoring Trustee of any formal written complaints received from customers pertaining to
the time taken by the Maziv Group to approve requests for access to (i) Wholesale Metropolitan
Fibre Services, (ii) Wholesale FTTH Services), (iii) Wholesale FTTB Services and (iv)
Wholesale Key Services within 14 (fourteen) Business Days of receiving the formal written
complaint from the customer; and shall at the same time provide the Commission and the
Monitoring Trustee with detailed and specific written reasons for the time taken to approve the
request for access.
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19.9 On an annual basis, Vodacom SA will prepare a confirmatory statement to be delivered to the
Commission and the Monitoring Trustee confirming:
19.9.1 Vodacom SA Group’s adherence to the 5G/FWA roll out commitments offered;
and
19.9.2 that Vodacom SA Group and the Maziv Group have not coordinated in relation
to planning, network build, and the exchange of any competitively sensitive
information.
19.10 If Vodacom SA Group starts providing Fixed Wireless Services to any firm in the Maziv Group,
Vodacom SA shall:
19.10.1 within one month of the date on which its starts providing such Fixed Mobile
Services to a firm within the Maziv Group, notify existing customers who procure
Fixed Wireless Services from Vodacom SA Group of these Conditions and shall
place a non-confidential version of the Conditions on its website; and
19.10.2 from the date on which it starts providing Fixed Mobile Services to a firm within
the Maziv Group and thereafter for a period of :
19.10.2.1 provide the Commission and the Monitoring Trustee with copies of the Vodacom Product
Rules, including their SLA terms within 5 (five) Business Days of the of the date on which
its starts providing Fixed Mobile Services to a firm within the Maziv Group
19.10.2.2 advise the Commission and the Monitoring Trustee if any material amendments are made
to the Vodacom Product Rules, including their SLA terms, which pertain to Fixed Mobile
Services and shall provide the Commission with a copy of such amended Vodacom
Product Rules, including their SLA terms within 5 (five) Business Day of such
amendments coming into effect;
19.11 For as long as Vodacom SA controls Maziv), Maziv shall submit a compliance report on an
annual basis to the Monitoring Trustee and Commission within 90 days of the anniversary of
the Implementation Date detailing compliance with, and disclosing any non-compliance with,
the Implementation Date detailing compliance with, and disclosing any non-compliance with,
the Conditions in the preceding 12 (twelve) months.
19.12 The report referred to in clause 19.11 above shall include the following information in relation
to the following products or services provided by the Maziv Group: (i) Wholesale Metropolitan
Fibre Services provided to any Third Party FTTH ISP; (ii) Wholesale Metropolitan Fibre Services
provided to any Third Party FTTH Provider; (iii) Wholesale Metropolitan Fibre Services provided
to any Third Party FTTB ISP; (iv) Wholesale Metropolitan Fibre Services provided to any Third
Party FTTB Provider; (v) Wholesale Metropolitan Fibre Services provided to any Mobile
Network Operator, (vi) Wholesale FTTH Services provided to any Third Party FTTH ISP, (vii)
Wholesale FTTB Services provided to any Third Party FTTB Provider; (viii) Wholesale FTTB
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Services provided to any Third Party FTTB ISP; and (ix) Wholesale Key Services provided to
any third party ISP or Third Party Key Reseller:
19.12.1 Where applicable, Transfer Pricing reflecting the internal price charged per
product or service for access to the Maziv Group's backhaul, or last mile fibre
infrastructure;
19.12.2 The terms and conditions, including Product Rules (and SLAs), Vumatel Framework
Agreements, payment terms, and prices charged by the Maziv Group in the preceding 12
(twelve) months for (i) Wholesale Metropolitan Fibre Services, (ii) Wholesale FTTH Services
(iii) Wholesale FTTB Services and (iv) Wholesale Key Services to:
19.12.2.1 entities in the Maziv Group;
19.12.2.2 entities in the Vodacom SA Group;
19.12.2.3 third parties;
19.12.3 The names and contact details (including regional location) of any parties who applied for
access to (i) Wholesale Metropolitan Fibre Services and (ii) Wholesale FTTH Services; (iii)
Wholesale FTTB Services; or (iv) Wholesale Key Services during the preceding 12 (twelve)
months.
19.12.4 The names and contact details (including regional location) of all parties who were granted
access to (i) Wholesale Metropolitan Fibre Services, (ii) Wholesale FTTH Services, (iii)
Wholesale FTTB Services; or (iv) Wholesale Key Services pursuant to the former’s
applications in the preceding 12 (twelve) months.
19.12.5 Details of each instance where the Maziv Group failed to comply with its SLA’s
mean time to repair obligations, per customer, per product for the Maziv Group
top 20 customers (and specifically including the Vodacom SA Group) of (i)
Wholesale Metropolitan Fibre Services, or (ii), Wholesale FTTB Services.
19.13 Maziv and Vodacom SA shall within 10 (ten) Business Days from the Approval Date circulate
to the Employees of DFA, Vumatel and their wholly-owned subsidiaries and Vodacom SA a
copy of these Conditions relating to employment.
copy of these Conditions relating to employment.
19.14 As proof of compliance with these Conditions, Maziv and Vodacom SA shall within 5 (five)
Business Days of circulating these Conditions in terms of clause 19.13, provide the Commission
and the DTIC with affidavits by the Chief Executive Officers of Maziv and Vodacom SA (a)
stating the number of Employees of Vumatel and DFA and their wholly owned subsidiaries as
at the Approval Date, and (b) attesting to such circulation of these Conditions and attach a copy
of the said notice.
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19.15 Maziv shall submit a compliance report ("Public Interest Annual Report") on an annual basis
to the Commission and the DTIC within 90 (ninety) days of each anniversary of the
Implementation Date detailing compliance with, and disclosing any non-compliance with, the
public interest obligations set out in this Agreement in the preceding 12 (twelve) months. The
obligation to submit the Public Interest Report shall cease one year after the expiry of the period
for compliance with the applicable public interest obligations set out in clauses 10 and 15 to 17.
19.16 Without derogating from the generality of clause 19.15, the Public Interest Annual Report shall
include the following information:
19.16.1.1 Details of the police stations, Healthcare Facilities and libraries provided with 5G mobile
broadband access in terms of clause 10.4 during the preceding 12 (twelve) months.
19.16.1.2 Details of the Capex spend during the preceding 12 (twelve) months including the number
homes passed and the number of homes connected in Reach Areas and Key Areas, per
suburb, town, village, township and/or informal settlement in South Africa.
19.16.1.3 Details of the Schools, public libraries and clinics provided with 1 (one) Gbps uncapped
access in terms of clause 17.2.1;
19.16.1.4 Details of the Employee Benefit Scheme established in terms of clause 17.8including the
number of Employees then benefitting from the Scheme and the amount allocated to
each Employee in terms of such Scheme during the preceding 12 (twelve) months.
19.17 Maziv shall, for a period of from the Implementation Date, or for as long as
Vodacom SA and CIVH are direct or indirect shareholders of Maziv (whichever is the shorter
period) annually,within10(ten)BusinessDaysofthe annualrenewalofMaziv's shareholders’
B-BBEE verification certificates, provide the Commission, the DTIC and the Monitoring Trustee
B-BBEE verification certificates, provide the Commission, the DTIC and the Monitoring Trustee
with proof of its shareholders' B-BBEE Ownership Status.
19.18 Maziv shall appoint an independent auditor of its choice approved by the Commission and the
DTIC to complete agreed upon procedures on each Public Interest Annual Report and each
such Public Interest Annual Report shall be accompanied by a written agreed upon procedures
declaration from such independent auditor confirming the accuracy of the information contained
in the report.
19.19 The Commission and the DTIC may request any information that relates to these Conditions,
which information shall, unless the Commission or the DTIC, as the case may be, agrees to an
extension, be provided by the Merger Parties within the time specified by the Commission or
the DTIC (as the case may be) when making its request.
19.20 The Commission and/or the DTIC shall be entitled in the exercise of their respective reasonable
discretions within 14 (fourteen) days of receiving the Public Interest Annual Report or the
information requested in terms of clause 19.19 to require the Merger Parties to provide an
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affidavit attested to by the chief executive officer(s) Maziv and/or Vodacom SA (as appropriate,
in relation to a specific Condition) confirming the accuracy of any aspect of the Public Interest
Annual Report and full compliance with the Conditions in the year to which the Report relate.
Such affidavit(s) shall be provided within 14 (fourteen) days after written request from the
Commission or the DTIC, as the case may be.
20 CONDITIONS SUPERSEDE PREVIOUS CONDITIONS
20.1 Post-Implementation Date, these Conditions supersede the following conditions imposed by the
Tribunal in the CIVH/Vumatel Merger and CIVH and Vumatel will, from the Approval Date, no
longer be required to comply with such conditions imposed by the Tribunal in the CIVH/Vumatel
Merger:
20.1.1 Clause 3 (open access)
20.1.2 Clause 4 (expansion plans)
20.1.3 Clause 7.2 (free school access)
20.1.4 Clauses 8.2,
20.1.5 Clause 8.3, 8.4.1, 8.4.2, 8.4.3, 8.4.4, 8.4.5, 8.4.6, 8.4.7, (compliance report)
20.1.6 Clause 8.5 (Accounting Officer affidavit)
20.1.7 Clause 8.9 (notice of conditions to customers)
20.2 Furthermore, CIVH will no longer be required to submit the information referred to in clauses
8.4.8 (update on public interest condition implementation) and 8.4.9 (details of confidentiality
policies) in the compliance report referred to in clause 8.2 of the CIVH/Vumatel Merger
conditions and shall instead, as from the Approval Date and for the remainder of the duration
of the CIVH/Vumatel Merger conditions, be required to submit such information in the
compliance report that is to be submitted in terms of 19.11 of these Conditions.
21 APPARENT BREACH OF CONDITIONS
21.1 In the event that the Commission receives a complaint regarding non-compliance by the Parties
with these Conditions, or otherwise is of the view that there may have been an apparent breach
with these Conditions, or otherwise is of the view that there may have been an apparent breach
by the Parties of the Conditions, the matter shall be dealt with in terms of Rule 39 of the Conduct
of Proceedings in the Commission.
22 VARIATION OF CONDITIONS
22.1 The Parties or the Commission may at any time, and on good cause shown, apply to the
Tribunal for any of the Conditions to be waived, relaxed, or modified and/or substituted.
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22.2 The Commission, the DTIC and/or any registered trade union (as contemplated in section
13A(2)(a) of the Competition Act) of the Maziv Group shall be entitled to oppose any variation
of the Conditions.
23 CORRESPONDENCE
23.1 All correspondence in relation to the Conditions must be submitted to the following email
address: mergerconditions@compcom.co.za.
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APPENDIX "B"
IN THE LARGE MERGER BETWEEN:
VODACOM PROPRIETARY LIMITED
and
BUSINESS VENTURE INVESTMENTS NO 2213 PROPRIETARY LIMITED ("MAZIV"), A WHOLLY
OWNED SUBSIDIARY OF COMMUNITY INVESTMENT VENTURES HOLDINGS PROPRIETARY
LIMITED
MONITORING TRUSTEE MANDATE
1 DUTIES OF THE TRUSTEE
1.1 The Monitoring Trustee shall in consultation with Maziv and the Commission prepare a detailed
working plan, including a resourcing schedule, describing how the Monitoring Trustee intends
to monitor compliance with the Conditions and shall send a copy of such working plan to Maziv
and the Commission within 30 (thirty) days of the Monitoring Trustee's appointment.
1.2 The Monitoring Trustee shall, for the duration of the Monitoring Period, act on behalf of the
Commission to monitor the Merger Parties' compliance with the provisions of the Conditions
and shall carry out the following duties:
1.2.1 monitor the steps that Maziv is taking to maintain the overlapping infrastructure
referred to in clause 8.1 of the Conditions and to report to the Commission
whether it is managed in the ordinary course of business, pursuant to good
business practices;
1.2.2 observe and inform the Commission of the progress of the negotiations between
Maziv and/or Vumatel and the proposed Purchaser(s);
1.2.3 monitor compliance with the Conditions by the Merger Parties, including by
assessing on an annual basis the Monitoring Report detailed in clause 19.11 of
the Conditions;
1.2.4 provide to the Commission a written report annually within 60 (sixty) days of
receiving each monitoring report referred to in clause 19.11 of the Conditions
from Maziv so that the Commission can assess whether or not the Conditions
are being complied with,
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1.2.5 send Maziv a non-confidential copy at the report referred to in 1.2.4 of this
mandate at the same time that the Monitoring Trustee sends such report to the
Commission; and
1.2.6 assess any concerns or complaints raised by third parties that suggest a possible
non-compliance with the Conditions.
1.3 The Monitoring Trustee shall, from the date of its appointment until the end of the First
Divestiture Period, furnish the Commission with a monthly written report that shall cover the
following topics:
1.3.1 monitoring of the preservation of the overlapping infrastructure referred to in
clause 8.1 of the Conditions;
1.3.2 Maziv's compliance with its obligations to manage the overlapping infrastructure
referred to in clause 8.1 of the Conditions with reasonable care and skill;
1.3.3 theprogressofMazivand/orVumatel’snegotiationswith potentialPurchasers;
1.3.4 any issues or concerns regarding the divestiture of the overlapping infrastructure
referred to in clause 8.1 of the Conditions.
1.4 A detailed plan describing how the Monitoring Trustee intends to dispose of the overlapping
infrastructure referred to in clause 8.1 of the Conditions will be drawn up by the Trustee and
submitted to the Commission by the Monitoring Trustee, within 15 (fifteen) Days of the
commencement of the Trustee Divestiture Period. The Monitoring Trustee shall send Maziv a
copy of the plan at the same time.
1.5 The Monitoring Trustee shall, for the duration of the Trustee Divestiture Period, furnish the
Commission with a report (every month) concerning his/her efforts to identify a suitable
Purchaser(s) and the progress made in concluding the Divestiture within the Trustee Divestiture
Period. The Monitoring Trustee shall send Maziv a copy of each such report at the same time.
2 ASSISTANCE BY THE MERGER PARTIES TO THE TRUSTEE
2 ASSISTANCE BY THE MERGER PARTIES TO THE TRUSTEE
2.1 The Merger Parties shall provide the Monitoring Trustee with all such cooperation, assistance
and information as the Monitoring Trustee may require to perform his or her mandate.
2.2 The Monitoring Trustee shall have full and complete access to any of Maziv Group’s books,
records, documents, management or other personnel, facilities, sites and technical information
reasonably necessary for fulfilling its duties under this mandate and Maziv shall provide the
Monitoring Trustee upon request with copies of any documents except where such disclosure
would give rise to a loss of any applicable legal privilege.
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3 CONFIDENTIALITY
3.1 The Monitoring Trustee's report and any other document generated by the Monitoring Trustee
in relation to his or her mandate will be confidential and for the sole use of the Monitoring
Trustee,theCommissionandMaziv(orMaziv’sadvisors).
3.2 The Monitoring Trustee shall present its draft non-confidential reports to Maziv in advance of
the submission of these reports to the Commission, in order that Maziv may review the factual
contentofthereportand provideMaziv’scomments.
3.3 Any unresolved disagreement between the Monitoring Trustee and Maziv concerning the
content of the draft report must be noted in the final report.
3.4 Any report obtained by the Commission from the Monitoring Trustee shall only be used by the
CommissionforpurposesofassessingtheMergerParties’compliancewiththeConditions;and
not, without Maziv’s consent, be shared with any persons, entities, regulators or departments
other than the DTIC (whether based in South Africa or elsewhere).
4 FEES AND EXPENSES
Maziv shall pay the Monitoring Trustee's fees and expenses.
16
5 REPLACEMENT, DISCHARGE AND RE-
APPOINTMENT OF TRUSTEE
5.1 The Commission may, at any time, after consultation with the Monitoring Trustee, order
Maziv to remove the Monitoring Trustee, if the Monitoring Trustee has not acted in
accordance with the Monitoring Trustee's mandate.
5.2 In such event, a new Monitoring Trustee shall be appointed in accordance with the
procedure referred to in the Conditions.
6 TERMINATION OF THE MANDATE
The Monitoring Trustee's mandate will automatically terminate at the end of the Monitoring
Period.
7 FAST
TRACK EXPERT DETERMINATION
7.1 If any third party (“(“Complainant”)submits
a complaint of alleged non-
compliance by the
Parties with these Conditions to the Commission for investigation in accordance with the
provisions of Rule 39 of the Rules for the Conduct of Proceedings in the Commission
(“Commission Rule 39”),as contemplated in clause 2121 of the Conditions ("Rule39
Complaint"), the Complainant may also request a fast-
track expert determination (“Expert
Determination”)in terms of this clause 7for interim relief pending the resolution of its Rule
39 Complaint.
7.2 A Complainant’s request for an ExpertDetermination (“(“Request”) must be submitted in
writing to the Monitoring Trustee and:
7.2.1 specify (i) the nature of the alleged non-compliance and (ii) the interim
remedy sought by the Complainant;
7.2.2 must be supported by an affidavit setting out all the facts relied on by the
Complainant in support of its Request;
7.2.3 attach the Rule39 Complaint submitted to the Commission; and
7.2.4 be copied to the Commission and the Merger Parties.
7.3 Within 15 business days after receipt of the Request, the Merger Parties may respond to
the request (the “Response”). The Response shall:
7.3.1 take the form of an affidavit;
7.3.2 set out the Merger Parties’ response to the Request, all the facts on which
they rely, and the relief (if any) they proposebe imposed while the Rule 39
Complaint is resolved by the Commission; and
7.3.3 be sent to the Monitoring Trustee and copied to the Complainant and the
Commission.
7.4 On receipt of the Response, or within 20 days of receiving the Request if no Response is
received, the Monitoring Trustee shall appoint an individual person (the “Expert”) from
within the ranks of the Monitoring Trustee or from an external source, with the specific
expertise required to determine the issues raised in the Requestand the Response.
7.5 The costs of the Expert shall be borne by Maziv.
7.6 Within 30 business days after the appointment
of the Expertor such longer period as may
be agreed by the Complainant and Merger Parties in writing, the Expertshall issue an
Expert Determinationwhich shall:
7.6.1 set out the Expert'sfindings on the factual allegations made by the
Complainant and the Merger Parties;
7.6.2 record theinterim relief granted (if any)pending the final resolution of the
Rule39 Complaint by the Commission;
7.6.3 include the Expert'sreasons for such findings and relief (if any); and
7.6.4 be sent to the Complainant, the Merger Parties, the Monitoring Trustee
and
the Commission.
7.7 For the purposes of making the Expert Determination, the Expert
7.7.1 may request such further documents and information from the Complainant
and the Merger Parties it believes necessary to determine the issues raised
ininthe Requestand the Response
;
7.7.2 may adopt such procedures and timelines to obtainany further documents
and information as it considers appropriate; and
7.7.3 shall at all times act impartially as an expert and not as an arbitrator.
7.8 The Merger Parties shall take all necessary steps to implement any interim relief granted
by the Expertand maintain compliance therewithpending the resolution of the Rule39
Complaint.
7.9 The provisions of this clause 7, including any findings made or interim relief granted by anan
Expert, shall in all respects be subject to, and replaced by, the outcome of
the
Expert, shall in all respects be subject to, and replaced by, the outcome of
the
Commission’s investigation and determination of the Rule 39 Complaint. For the avoidance
of doubt:
7.9.1 In the event that the Commission decides not to issue a Notice of Apparent
Breach in relation to the Rule39 Complaint:
7.9.1.1 it shall communicate that decision in writing to the Complainant, the
Merger Parties and the Monitoring Trustee as soon as it is made; and
7.9.1.2 the Merger Parties shall no longer be required to comply with the
determinationof the Expertas contemplated in clause 7.7.6 above,
which shall cease to be of any force or effect.
7.9.2 In the event that the Commission decides to issue a Notice of Apparent
Breach in relation to the Rule39 Complaint:
7.9.2.1 it shall send that Notice to the Complainant, the Merger Parties and
the Monitoring Trustee as soon as it is issued; and
7.9.2.2 the Merger Parties shall be required to comply with any Expert
Determinationas contemplated in clause 7.7.6above until such time as
the Commission accepts a proposed remedial plan as provided for in
Commission Rule 39, or the Merger Parties successfully review the
Notice of Apparent Breach before the Tribunal, at which time the
Expert Determinationshall cease to be of any force or effect.
7.9.3 Any determinationby ananExpertin terms of this clause 7 shall not in any
respect be binding on the Commission or the Tribunal.
APPENDIX “C”
MAIN PRINCIPLES OF EMPLOYEE BENEFIT SCHEME
1.1. Type of benefit: Participatory phantom share scheme i.e. Employees will share in the value of
Maziv through a synthetic structure involving a bespoke Special Purpose Vehicle (SPV).
2.2. Participation right: ESOP poolper Employee,irrespective of job
grade, ethnic grouping, demographic, or any other qualitative aspect.
3.3. Funding: No underlying funding (notional or otherwise) applicable
–no hurdle rate applicable
for economic participation of Employees. No administrative costs of the SPV or otherwise to be
deducted.
4.4. Duration of the scheme: Evergreen (in perpetuity).
5.5. Value participation: Within 5 (five) Business Days of the Implementation Date, the ESOP
benefit to the Employees will be determined based ESOP
pool of . This pool of funds will be used for the SPV to notionally subscribe for the
equivalent amount of Maziv shares based on a similar valuation used in respect of the transaction
value of the Merger. Within 5 (five) Business Days after at the date of implementation of the
Merger, the Parties shall submit the equivalent percentage shareholding that the Initial Value
would represent as a shareholding in Maziv. Thereafter, on an annual basis as and when Maziv
declares and pays dividends to its shareholders, the SPV will receive from Maziv its pro rata
share of notional dividends and distribute same to Employees evenly.
6.6. Whereas the value of the underlying Maziv shares will fluctuate on the basis of market dynamics
the number of shares will not fluctuate.
7.7. Listing/capitalisation/restructuring: These and similar capital events shall not be allowed to
diminish the economic value of the scheme to Employees except for rights issues at market
related rights issue pricing. To the best of the parties’ knowledge, no capital calls are foreseen
in the immediate future.
APPENDIX “D”
LIST OF POLICE STATIONS TO BE PROVIDED WITH MOBILE BROADBAND ACCESS BY
VODACOM SA GROUP
PROVINCE NO. OF SELECTED POLICE
STATIONS
N
r