SA Watchdog Demands Fairness for Online Platforms”

Harris Marley
Harris Marley

Global Courant

The South African Competition Commission recently took action against several online platforms, with the goal of encouraging competition and assisting smaller businesses. Google, Takealot, Uber Eats, and Apple are among the companies targeted, each of which is subject to specific demands in order to encourage greater competition from smaller entities.

One of the major directives calls for Google to provide R330 million in advertising credits and other forms of assistance to local small businesses. Takealot must also make changes to its website to encourage competition from smaller suppliers. Additionally, online real estate sites and car sellers must lower their listing prices for independent agencies and dealers.

After more than two years of investigation, the Competition Commission released its final report on the dominance of online retail platforms in South Africa. According to the report, Google will provide R180 million in advertising credits to small businesses and will give smaller online platforms more prominence in its search engine results. In addition, the tech giant must provide an additional R150 million in training, product support, and other measures to assist small and medium-sized enterprises and black-owned online businesses in overcoming competitive disadvantages on Google Search. In addition, Google will include a South African flag identifier in its search results to help consumers identify and support local retailers.

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Google Play and Apple Store Online have been directed to stop preventing smaller app stores from directing consumers to pay directly on their own sites, allowing for more competitive app market competition.

Takealot, in particular, is undergoing significant business changes. To avoid conflicts of interest, the commission has ordered that the company separate its retail division from its online marketplace. This separation is intended to prevent retail services from accessing seller data and to prevent sellers from competing for specific brands unilaterally. Takealot will also be required to implement a 60-day dispute resolution process for marketplace sellers’ complaints about returns and stock loss, ensuring fair and efficient conflict resolution. Takealot must implement a programme that offers personalised onboarding, waives subscription fees for the first three months, and provides at least R2000 in advertising credit for the first three months to encourage disadvantaged businesses to participate in e-commerce.

Concerning Amazon’s potential entry into South Africa, the inquiry chair clarified that, while there had been rumours of its arrival, nothing had been confirmed. If Amazon enters the market, it will be subject to the same conditions as Takealot and other platforms.

Property24, Autotrader, and have also been ordered to significantly lower the prices of their listings for small and medium-sized independent agencies and dealers, thereby levelling the playing field for smaller players in the property and car markets.

In addition to the foregoing, online food delivery platforms such as Uber Eats and Mr D will need to inform customers if they charge a commission fee to restaurants and clarify that menu items may be priced differently than in restaurants.

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These new requirements are effective immediately, but will be phased in to allow businesses to adapt to the changes. The Competition Commission hopes that these interventions will empower smaller South African online platforms while also creating a more equitable environment in the face of retail giants’ dominance.

Overall, the Competition Commission’s actions represent an important step towards fostering a more competitive and inclusive online marketplace in South Africa, benefiting smaller businesses and ultimately providing consumers with more choices and fairer pricing options.

SA Watchdog Demands Fairness for Online Platforms”

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