| Mon 14 Sep 2009, 14:07 | | GEN - The Competition Commission - Press Statement |
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THEE
GEN - The Competition Commission - Press Statement
PRESS STATEMENT
14 September 2009
Competition Commission refers findings of wire investigation to the Tribunal
The Competition Commission has on Tuesday, 08 September 2009 referred findings
of collusion by 11 companies involved in the manufacturing and distribution of
wire and wire products in South Africa, Botswana, Swaziland, Mozambique and
Namibia, to the Tribunal for prosecution.
The 11 companies include Cape Gate, Allens Meshco, Hendok, Independent
Galvanising and Meshrite. They sell wire and wire products to agricultural co-
operatives, fence erectors, hardware stores and resellers.
The Commission is recommending that the Tribunal impose an administrative
penalty of 10% on each of the respondents based on their respective annual
turnover for the preceding financial year.
Background
In January 2007, the Commission referred a cartel case to the Tribunal against
Allens Mescho, Wireforce Steelbar, Hendok, Galvwire, Independent Galvanising and
Meshrite, alleging that the respondents directly or indirectly fixed a purchase
or selling price in respect of lightly galvanised wire, nails, wire and various
wire products.
Following this referral, during July 2008, Consolidated Wire Industries (CWI) a
subsidiary of Scaw South Africa (Pty) Ltd admitted that its employees
participated in price-fixing meetings with their competitors namely Cape Gate,
Allens Meshco and Hendok. They agreed on a national price list for wire and wire
products, on adjustments to the national price list and in collusive tendering
of cable armouring wire. CWI and Cape Gate also agreed not to target each
other`s customers.
Evidence gathered by the Commission through its investigation confirms that,
from 2001 to 2008, the respondents contravened the Competition Act by engaging
in price-fixing, market allocation and collusive tendering. The tenders involved
include tenders from Harmony Gold, African Cables and Malasela Technologies.
Consolidation
The Commission has consequently applied for a postponement of the hearing of the
2007 case, which was set to take place on 5 - 16 October 2009 and will apply to
consolidate the two referrals.
"Given similarities in the conduct investigated and the parties involved, we
believe it is appropriate that both these cases be heard at the same time by the
Tribunal," says Commissioner Shan Ramburuth.
This referral marks further inroads that the Commission is making in the
infrastructure and construction sector, a sector which remains a priority for
competition enforcement.
ENDS
Jennifer Cohen 011 214 2401/ 082 468 6469/ jennifer.cohen@fd.com
Dani Cohen 021 487 9021 / 082 897 0443 dani.cohen@fd.com
Senzi Dlamini 011 214 2420 / 073 494 0030 senzi.dlamini@fd.com
On behalf of: The Competition Commission
Further info:
Keitumetse Letebele, HOD Communications
012 394 3183 / 082 783 3397 / keitumetsel@compcom.co.za
Date: 14/09/2009 14:07:01 Produced by the JSE SENS Department.
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