In 1920 the government of the Union of South Africa, which at the time was a dominion under the British Empire, was confronted with a dilemma. Shopkeepers of mostly Indian descent had made inroads into key business sectors in the Union and had ‘become formidable competitors with European traders’.This latter group had turned increasingly agitated by what they saw as an ‘Asiatic menace’. Anger was particularly acute in the Transvaal province, where Asiatics had recently returned after having fled the South African War. This posed a particular headache for the British Crown, as the region's large Afrikaner (or ‘Dutch’, as it was then termed) population was already resentful of British rule. Mobilisations and complaints by European traders, municipal authorities and chambers of commerce had sprung up across the province. In response, the governor-general of the Union, British aristocrat Viscount Sydney Buxton, established a commission of inquiry into laws regulating Asiatic trade in the country.

The objections against Asiatics, especially ‘Bombay Mahomedans’, were diverse. They are set out in a worn-out copy of the commission's report held by the University of California's Southern Regional Library Facility (SRLF). Witnesses in the Transvaal testified that Asiatics sent their money out of the country and were a ‘source of danger to the public health owing to their unclean habits’. Their trading methods also differed from those of Europeans. They resided on business premises, kept their shops open for longer, habitually sold ‘short weight and adulterate foodstuffs’, and formed ‘“rings” to keep out European competitors’. Importantly, by operating businesses, Asiatics were believed to ‘close avenues of employment which should be open to Europeans’.

The Asiatic menace was not an isolated phenomenon. During the 1950s and 1960s studies theorising the phenomenon of ‘middleman minority’ emerged in the United States. Middleman minority groups, they highlighted, are particularly prone to hostility from host populations. Examples of these groups include Jews in pre-war Europe, Indians in East Africa, Chinese in Southeast Asia, and Koreans in North America. Middleman minorities play an intermediary role in host societies.They are usually immigrants or descended from immigrants and bridge what some theorists have termed the ‘status gap’ between ruling elites and subordinate groups in certain polarised and unequal societies. This entails moving into and offering services in areas that have been neglected and avoided by a country's ruling classes.