South African Wal-Mart mega-merger in ‘fundamentally flawed’ claim

South African Commercial, Catering and Allied ...

Unions appealing rulings as 'flawed'

Appeal against Wal-Mart and Massmart merger in South Africa

By ECM Plus staff

ECM Plus +++ Court hearing commences today to determine whether the South African merger of Wal-Mart and Massmart can proceed, or whether the matter should be referred back to the Competition Tribunal for consideration.

Three South African Government Ministries, supported by labour federation COSATU, are appealing based on their claim that the earlier Competition Tribunal proceedings were fundamentally flawed and are seeking a full rehearing of the matter.

The Ministries’ case will be followed by a hearing on the appeal entered by UNI Global Union affiliate and the union representing retail workers in South Africa, SACCAWU.

SACCAWU presented new evidence to the court only days ago which shows that Massmart has already imported Wal-Mart’s anti-union practices and that the company has already started growing its imports and reducing local sourcing, both of which are key factors under South Africa’s merger approval regime.

Philip Jennings, General Secretary, UNI Global Union commented: “UNI stands side by side with SACCAWU and COSATU in this case. We welcome the Government’s demands that the full story be told before this merger goes forward. We have opposed Wal-Mart’s entry into South Africa because it will clearly threaten conditions in the retail sector, reduce jobs in the supply chain, and will have a negative impact on the wider economy and society as well.”

The unions are contesting the findings of the Competition Commission and Competition Tribunal on the grounds that proper consideration was not given to substantial evidence provided by labour, independent experts and government experts. The evidence of these experts pointed to clear concerns about Wal-Mart’s track record of slashing jobs, destroying local economies and anti-union behaviour.

South Africa’s Economic Development Minister, Ebrahim Patel, Trade and Industry Minister, Rob Davies, and Agriculture, Forestry and Fisheries Minister, Tina Joemat-Pettersson, have applied for a review of the acquisition.

Michael Bride of North America’s United Food and Commercial Workers Union (UFCW), who is attending the hearing in Cape Town added: “We support the actions of the Government departments, COSATU and SACCAWU because we have seen the impact that the Wal-Mart business model can have on workers”.

Bride, who represents a 1.3 million member union based in Wal-Mart’s homeland pointed to the disparity between what Wal-Mart told the Tribunal and what it is telling investors, stating “Wal-Mart has been assuring its investors – as recently as last week in Bentonville, Arkansas – that it will use its global muscle in areas like procurement to push costs down even further. It is difficult to reconcile this position with the claim that Wal-Mart will be good for South African suppliers, which is why the Appeals Court should not confirm the Tribunal’s decision in its current form”.

The Competition Appeal court will hear both the review and appeal this week. October 24 has been set aside in case the appeal and review hearings are not fully completed by Friday.

 


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