Damages, trade and other litigation

We offer the full spectrum of expert economic support and advice in litigated and contested processes. Our diverse litigation experience enables us to provide rigorous and legally defendable analysis, advice and testimony for clients in a variety of legal processes, including damages, international trade disputes, and other arbitration and High Court proceedings.

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Expertise Areas

Damages quantification

The need for damages quantification can arise in a variety of settings, such as a breach of contract or illegal conduct by a firm. 

Damage quantifications are often complex and can require expert economic services to understand and accurately quantify the impact of any offensive conduct on another firm’s profits, or the market as a whole.

Genesis uses its extensive expertise in financial and economic modelling, together with its economics-based understanding of market dynamics and competition, to make rigorous market projections which enable the quantification of damages that are robust and able to withstand legal scrutiny.

Our extensive experience in the quantification of damages and expert testimony extends across a wide variety of sectors such as cellular phone technologies and products, wholesale rates for fixed lines, postal communications and agricultural supply contracts.

International trade disputes

International trade disputes typically concern issues such as dumping, tariffs and tariff applications, trade remedies, and trade-focused policies.

Genesis regularly advises firms, regulators and courts of law on the impact of policy and regulatory measures affecting South Africa's imports or exports. 

Our trade expertise and evidence-based approach allow us to understand the true economic impact of policies and tariffs, not only for the firm but for the market as a whole.  

Our rigorous analysis has brought clarity to key contested processes, whether at the ITAC, in the High Court, or in other dispute-resolution forums. 

Our experience ranges from the scrap-metal price preference policy to sugar protection, trade protection and policies for poultry.

High Court litigation and arbitration proceedings

With our extensive experience of providing economic expert analysis and testimony, 

Genesis is ideally positioned to provide economic support and advice across a broad range of litigated processes. 

Our experience in this area includes providing expert evidence in litigation related to the lottery licence, bargaining council extensions, acting as the arbitrator in a dispute between airlines in South Africa and resolving contractual disputes in arbitration. 

Projects

Expert advice on dumping of poultry in SA market

Project name:
Series of cases to understand the impact imported poultry products on SA market

Service:
Trade

Sector:
Agriculture and Agribusiness

Client:
South African Poultry Association (SAPA)

Date:
2013 - 2016

Country:
South Africa


Genesis has become an important source of independent analysis and advice to the South African Poultry Association (SAPA) and, through these engagements, also to decision-makers in South Africa’s International Trade Administration Commission (ITAC), the Department of Trade and Industry (the DTI) and the Department of Agriculture, Forestry and Fisheries (DAFF).

Over the past three years, we have helped ITAC to understand the potential impacts on domestic prices and consumers, and also on domestic poultry producers arising from SAPA’s tariff and anti-dumping applications against imported poultry products.

Our work has also shaped and developed all stakeholders’ understanding of the conceptual underpinnings of the trade remedies available in South Africa’s Trade, Development and Co-operation Agreement (TDCA) with the European Union (EU). This has extended to our involvement in SAPA's application ITAC, submitted this year, to invoke these trade remedies in an effort to mitigate the impacts of imports from EU producers under the TDCA.

In 2015, we also helped the DTI to understand and to be able to compare the relative costs of the threats and demands made by the US government in relation to South Africa's continued membership of the African Growth and Opportunity Act (AGOA), which was a significant source of concern to SAPA at the time.

In these various work streams, Genesis has modelled the transmission mechanism between higher tariffs, domestic prices and consumer welfare, as well as the average return on capital employed by domestic producers to be able to continue investing in their businesses.

These analyses have generated a clearer understanding of the trade-offs between different types and levels of import protection. They have also assisted ITAC and the dti in their decision-making over what are critical economic policy issues from the perspective of domestic manufacturing capacity and employment.

Trade-related analysis on poultry imports from USA

Financial evaluation of third National Lottery applicants

Project name:
Financial Evaluation of Third National Lottery Applicants

Service:
Damages, trade and other litigation

Sector:
Public and social
Entertainment

Client:
Minister of Trade and Industry

Date:
2014

Country:
South Africa


Every eight years the licence to operate the National Lottery is awarded to a successful bidder through a rigorous and lengthy tender process. After receiving conflicting recommendations from the Evaluation Committee and the National Lotteries Board, the Ministry of Trade and Industry brought in Genesis to conduct an independent and substantive evidence-based assessment of the financial and business models of the competing applicants. 

The purpose was to assist the minister in selecting a successful (and reserve) bidder in order to negotiate and conclude a licence, and where the rationality and reasonableness of the decision would likely be under intense scrutiny.

Genesis used its experience to distil the key features of each business and financial models, and identify quantitative measures that would enable an independent evidence-based comparison across the bids on the five different variables that formed part of the assessment criteria. This included assessing a ranking on likely sales based on capex, distribution networks, prize payouts and new game development. It also included assessing financial solvency by subjecting the financial models to different revenue scenarios. In the process Genesis developed a robust new scoring method that built on the quantitative measures of the business and financial plans, but also built on the techniques applied in other government procurement programmes (such as relative points based on relative pricing).

The Genesis assessment provided the basis for the decision by the minister to select the successful bidder. Furthermore, the Genesis report and scoring have stood up to intense scrutiny as the minister’s decision has been subject to a number of reviews by one of the unsuccessful bidders. As such, the Genesis work has also proved invaluable to the High Court judges in adjudicating the litigation.

Trade-related analysis on poultry imports from USA

Project name:
Trade-related analysis on poultry imports from USA

Service:
Trade

Sector:
Agriculture and Agribusiness
Manufacturing

Client:
South African Poultry Association (SAPA)

Date:
2015

Country:
South Africa


Genesis has become an important source of independent analysis and advice to the South African Poultry Association (SAPA) and, through these engagements, also to decision-makers in South Africa’s International Trade Administration Commission (ITAC), the Department of Trade and Industry (the dti) and the Department of Agriculture, Forestry and Fisheries (DAFF).

Over the past three years, we have helped ITAC to understand the potential impacts on domestic prices and consumers, and also on domestic poultry producers arising from SAPA’s tariff and anti-dumping applications against imported poultry products. Our work has also shaped and developed all stakeholders’ understanding of the conceptual underpinnings of the trade remedies available in South Africa’s Trade, Development and Co-operation Agreement (TDCA) with the European Union (EU).

In these various work streams, Genesis has modelled the transmission mechanism between higher tariffs, domestic prices and consumer welfare, as well as the average return on capital employed by domestic producers to be able to continue investing in their businesses. These analyses have generated a clearer understanding of the trade-offs between different types and levels of import protection. They have also assisted ITAC in its consideration of various objections raised by the importers and retailers who contested SAPA’s tariff and anti-dumping applications, many of which were speculative rather than evidence based.

Genesis also provided the dti with evidence-based analysis of the potential impacts of the USA’s decision to make South Africa’s continued inclusion in the African Growth and Opportunity Act (AGOA) contingent upon USA poultry producers gaining greater access to South Africa’s poultry market. This informed the dti’s negotiating strategy with representatives of the USA government, including the magnitude of the import quota eventually granted to USA producers. The objectives of this work required a thorough investigation of existing general equilibrium models to show the impacts on South African poultry producers and consumers of allowing USA poultry imports into the domestic market, as well as a rigorous analysis of the nature and extent of the potential harm to South African exports to the USA should AGOA preferences be revoked.

Genesis continues to provide economic advisory to SAPA on an ongoing basis. More recently, our team has been involved in assisting SAPA and the DAFF understand the impact of proposed brining regulations on domestic poultry producers and consumers.

Assessment of damages in R1-billion claim

Project name:
Assessment of a damages claim in the communications sector

Service:
Damages, trade and other litigation

Sector:
Communications and media

Client:
Large firm in the communications sector

Date:
2014

Country:
South Africa


Genesis provided an independent assessment of the appropriate damages quantum following the repudiation of an agreement between two large South African companies in the communications sector. The analysis was performed on behalf of the defendant in a claim that exceeded R1-billion.

The assessment involved the determination of the loss of profits arising within the context of the agreement having been repudiated before the business was launched. The challenge in this case arose from forecasting the loss of profits where there was no prior business history and where the available data on financial performance was limited.

We assisted the legal team throughout the litigation process, ensuring that sufficient evidence was gathered through the discovery process so that we were able to provide a defendable and reasoned expert opinion on the damages claim. Our project team combined its experience in economics, accounting and modelling with its in-depth understanding of the communications sector to develop a robust economic model in order to quantify the damages claim.

The case was ultimately settled and the input provided by Genesis helped the legal team and the client to determine an appropriate amount as the basis of the settlement negotiations. 

Analysis of additional protective measures for SA Sugar Association

Project name:
Analysis of additional protective measures for the South African Sugar Association

Service:
Trade

Sector:
Agriculture and Agribusiness

Client:
South African Sugar Association (SASA)

Date:
2013

Country:
South Africa


The South African Sugar Association (SASA) asked Genesis to assist by examining a concern expressed by the International Trade Administration Commission (ITAC) that SASA’s application for increased protection against imported sugar would harm consumers.

Answering this question required us to analyse the nature and effect of laws and regulations that underpin a complex price-setting process in the domestic sugar industry, and in particular the extent to which domestic prices respond to increases in import prices. This provided the foundation for estimating the maximum possible increase in domestic producer prices in the event that ITAC approved SASA’s application. This in turn also allowed an estimation of potential consumer impacts, which arise through direct sugar purchases and through purchases of manufactured products containing sugar.

Using information from StatsSA Genesis provided critical insights to ITAC which ultimately provided comfort that the granting of SASA’s application would not generate significant consumer harm and would at the same time protect an industry that generates significant investment and employment opportunities in South Africa’s rural areas.

Regulation of medicine dispensing fee in pharmacies

Project name:
Regulation of the dispensing fee for medicines through pharmacies

Service:
Damages, trade and other litigation
Regulatory economics and accounting

Sector:
Health

Client:
Pharmacy Stakeholders Forum of South Africa

Date:
2006 – 2010

Country:


Genesis has worked extensively with the Pharmacy Stakeholders Forum of South Africa (PSF) in its protracted litigation with the Department of Health regarding price regulation of the dispensing fee for medicines sold through pharmacies.  The central question was whether the dispensing fees prescribed by the Department of Health were sufficient to provide a reasonable revenue stream to community pharmacies so as ensure the viability of the businesses.

Price regulation, by its very nature, raises intricate questions that require one to protect the interests of consumers while preserving the impetus for investment and operational sustainability of the regulated firm.  This was particularly complex in the case of community pharmacies, which comprise a large number of widely diverse individual businesses with differing operating models and levels of financial vulnerability.  Against this backdrop, Genesis was able to provide input to the key economic principles that would be important to ensure appropriate forms of price regulation that not only achieved the objectives of the Department of Health, but also safeguarded the sustainability community pharmacies.  Genesis also provided an economic assessment of the impact that the proposed dispensing fees would have on a sample of 142 pharmacies, for which detailed operational and financial information had been collected. 

Based on this analysis, Genesis found that the proposed dispensing fees, in their existing form, threatened to undermine the viability of a large number of community pharmacies.  This economic analysis proved instrumental in a settlement between PSF and the Department of Health which led to the suspension of the proposed dispensing fees in their original form.

Meet the Team

Areas of Service Expertise

  • Damages quantification
  • International trade disputes
  • High Court litigation and arbitration proceedings

Projects

Project

Expert advice on dumping of poultry in SA market

Genesis has become an important source of independent analysis and advice to the South African Poultry Association (SAPA) and, through these engagements, also to decision-makers in South Africa’s International Trade Administration Commission (ITAC), the Department of Trade and Industry (the DTI) and the Department of Agriculture, Forestry and Fisheries (DAFF).

View Project
Project

Financial evaluation of third National Lottery applicants

The Ministry of Trade and Industry brought in Genesis to conduct an independent and substantive evidence-based assessment of the financial and business models of the competing applicants.

View Project

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Leading the team

James Hodge

Director and Managing Partner (Competition and Regulatory Economics)

James Hodge
Director and Managing Partner (Competition and Regulatory Economics)
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Stephan Malherbe

Chair and Partner (Competition and Regulatory Economics)

Stephan Malherbe
Chair and Partner (Competition and Regulatory Economics)
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Fatima Maria Fiandeiro

Partner (Competition and Regulatory Economics)

Fatima Maria Fiandeiro
Partner (Competition and Regulatory Economics)
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Paul Anderson

Partner (Competition and Regulatory Economics)

Paul Anderson
Partner (Competition and Regulatory Economics)
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Anthony Felet

Partner (Competition and Regulatory Economics)

Anthony Felet
Partner (Competition and Regulatory Economics)
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