South Africa Competition Act 89 of 1998 8-1a: Dominant firms: no excessive pricing to the detriment of consumers or customers

What does 8-1a require?

A dominant firm must not charge customers or consumers an excessive price that harms them (section 8(1)(a)). Once a prima facie case is shown, the firm must demonstrate that its price was reasonable (section 8(2)). Whether a price is excessive turns on whether it exceeds a competitive price by an unreasonable margin, assessed on factors such as price-cost margins, rates of return and profit history, the firm's prices in competitive or other geographic markets and over time, comparator firms' prices and profits, how long the price has been charged, market structure and barriers to entry, advantages not earned through the firm's own efficiency or investment such as state support, and any ministerial regulations on excessive pricing (section 8(3)).