THE Competition Commission said yesterday it had placed conditions upon its approval of the proposed acquisitions by South African interbank clearing and settlements systems operator, Bankserv.
The mergers were small enough in terms of the Competition Act not to require compulsory notifications, but the commission requested the parties to make notifications of the mergers , as concern had been raised about their likely effect on competition.
Bankserv recently acquired Emid, a specialist provider of back-office information and communication technologies services to small banks and other financial institutions seeking account management.
It also took control of Nomad, a software provider, with the intention of establishing a smooth transmission of card payment instructions from a retailer's checkout system to the acquiring bank.
The commission said there was concern that the transactions may degrade the quality of access to the Bankserv platform enjoyed by Emid and Nomad's competitors, create opportunities for Bankserv to bundle products, or cross-subsidise Emid or Nomad's operations.
Bankserv said the acquisition of Emid and Nomad formed part of its commercialisation strategy.
Bankserv was initially created as a utility serving the major banks, which were also its major shareholders.
In terms of the conditions, Bankserv will have to continue to provide access to its platform in a "nondiscriminatory manner to all parties in need of such access", the commission said.
Payment Association of SA regulations need to be abided by in making pricing fair and transparent .
Other prohibitions include no cross-subsidising of the products and services and using profits made from Bankserv's core activities.
All conditions imposed will be valid for a decade and will be reviewed thereafter.
Bankserv will have to report to the Competition Commission for the 10- year period.
"Provided good cause is shown, the merging parties or any third party may approach the commission at any time during the initial 10-year period to revoke or amend these conditions," the commission said.
Bankserv will have to provide access to its platform in a 'nondiscriminatory manner' to all parties