TRIBUNAL CONFIRMS TWO CONSENT AGREEMENTS WHEREIN FIRMS AGREE TO PAY PENALTIES FOR ALLEGED COLLUSION IN NATIONAL TREASURY TENDER
Two firms run by a mother and son, respectively, have agreed to settle with the Competition Commission (“the Commission”) and pay penalties for allegedly colluding with each other in relation to a National Treasury tender for the supply, delivery and off-loading of animal feed to the State for the period 1 October 2016 to 30 September 2019.
Aludar Holdings (Pty) Ltd (“Aludar”) and Ikemele Egg Production CC (“Ikemele”) both deny contravening the Competition Act (“the Act”) but have concluded separate consent agreements with the Commission, wherein Aludar agrees to pay a penalty of R30 000 and Ikemele agrees to pay a R50 000 penalty. The consent agreements have both today been confirmed as orders by the Tribunal.
In addition to agreeing to pay the penalties, both Aludar and Ikemele undertake, among others, to refrain from engaging in any anti-competitive conduct, in contravention of the Act, in future. Both will also develop, implement and monitor competition law compliance programmes as part of their respective corporate governance policies.
Although both Aludar and Ikemele agree to the terms of their consent agreements, neither admit that they contravened the Act, as alleged by the Commission. The Commission, in turn, has agreed to enter into the two consent agreements without admissions of liability, based on, among others, the following factors, read with the remedies contained in the two consent agreements:
- Aludar and Ikemele are small firms;
- Given their small size, as well as the small size of the tender, the Commission does not consider it worthy to engage in protracted and costly litigation with either firm;
- Neither firm won the tender in question and therefore did not benefit from the alleged conduct; and
- Both firms are first-time offenders and have never contravened the Act before.
The Commission’s investigation found that on or about April 2016, Aludar and Ikemele, being competitors, assisted each other when completing their tender documents. The investigation revealed that the sole member of Aludar is the son of the sole member of Ikemele and that the two coordinated their bids when tendering, as evidenced by various similarities in their bid documents. The Commission concluded that the conduct between Aludar and Ikemele amounts to collusive tendering in contravention of section 4(1)(b)(iii) of the Act.
Gillian de Gouveia, Communications Officer
On behalf of the Competition Tribunal of South Africa
Cell: +27 (0) 82 410 1195
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