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In my question I don't want to mention any party at this…

In my question I...

In my question I don't want to mention any party at this time. My question will follow hereafter.

Lawyer's Assistant: What state are you in? It matters because laws vary by location.

In Cape Town, South africa

Lawyer's Assistant: Has anything been filed or reported?

I worked at a company (Company B) that was bought by another (Company A). I decided to resign at start up a new company. The transaction of A & B was subject to approval by the Competition Commission. After I left I contact some clients to provide our services to them, but found that they did not want to speak to us. From two clients we received appointments for our services, we established from minutes of meetings they had with these clients that they brought in a subsidiary 100% owned by the Company A, to provide certain services to the client. This was to stop us engaging with the company. Furhermore they told companies it will be a risk to work with us as we were a new company. My question - did Company B transgress the Competition Act by bringing in a 100% owned subsidiary of Company B before approval of the transaction, which only was approved on Friday. This happened in November last year we we only got facts end of January this year. I believe their actions prohibited us from getting to clients and stop competition. Both companies are financial service providers.

Lawyer's Assistant: Anything else you want the lawyer to know before I connect you?

Not at this stage thanks

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Answered in 18 hours by:
2/12/2018
Freddie Lombard
Freddie Lombard, Attorney
Category: South Africa Law
Satisfied Customers: 2,820
Experience: Practicing attorney and conveyancer with 16 years post article experience.
Verified

Hi I'm Freddie,

Welcome to Just Answer. Thank you for your question. I am reviewing it now and will post a reply here ASAP.

Regards

Ask Your Own South Africa Law Question

OK, just to be sure here, company A bought Company B, and then, whole waiting for approval from the Competition Commission used a wholly owner subsidiary of A to protect the business of B from outside competition.

However, the Competition Commission did eventually approve the sale of B to A.

In business you must understand that normally there is nothing wrong with protecting one's interests. It is also normally not illegal to do so. In other words, what company A did was to take proactive steps to ensure that part of the business that they acquired (by buying B) is not lost to them and to ensure that A can in the interim serve the needs of those clients until such time as the purchase have been approved and the transfer of the business goes through.

So, in short, no, I do not think they contravened the Competition Act. Their actions would have to have been unlawful. But, think about it like this - the subsidiary owned by A has exactly as much right to approach and try to source/secure business from the clients of B as you do.

I hope this answered your question.

I know it will take an extra minute of your time to rate my service, but if you do not rate it, I do not get paid by the website so I would really appreciate it if you would be so kind as to rate my service positively. Feel free to ask further questions here on this topic at no extra cost if you need more information.

Regards

Freddie Lombard
Freddie Lombard, Attorney
Category: South Africa Law
Satisfied Customers: 2,820
Experience: Practicing attorney and conveyancer with 16 years post article experience.
Verified
Freddie Lombard and 87 other South Africa Law Specialists are ready to help you
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Thank you so much for the positive rating. I hope I can be of assistance to you again in the future.

You may request me personally.

http://www.justanswer.com/law/expert-fwlombard1/

Regards

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DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.

The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).

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