The Tribunal has dismissed a case of alleged price fixing and collusive tendering against five Bloemfontein-based companies accused of colluding on a Free State Treasury tender to supply and deliver office stationery to provincial government departments in 2014.
Catha Silkscreen Printers CC (Catha), Melemo Trading CC (Melemo), Lounge 848 CC (Lounge), Nakanyane Business Solutions CC (NBS) and V Litabe and Seema Trading CC (Litabe) are competitors in the market for the supply of office stationery.
The Commission referred the companies to the Tribunal in 2017, after receiving a complaint and subsequently investigating such.
The Commission alleged that the companies had submitted similar bids, including the same or similar prices for certain stationery items and similar letters from suppliers, in response to the tender. The Commission argued that this conduct was the result of an agreement and/or a concerted practice between the companies and constituted price fixing and collusive tendering.
The companies, however, denied that they had colluded with each other when bidding for the tender.
In its order and reasons, the Tribunal has noted that there was “simply no evidence” that the companies had reached an agreement among themselves. In addition, the Tribunal has found that the Commission led no evidence to substantiate their “concerted practice” argument either.
A full copy of the order and reasons will be made available on the Tribunal’s website in due course at www.comptrib.co.za
The Free State Provincial Treasury intended to use the bids to appoint several service providers to supply stationery to various provincial departments. Correctly construed, the bid was an invitation to businesses to indicate their willingness and ability to supply stationery to provincial government departments at a price which would ultimately be determined by the Free State Provincial Treasury. On 27 November 2014, the companies attended a compulsory briefing session.
Among others, evidence was heard that a sales representative for the only/largest stationery supplier in Bloemfontein had assisted the companies to prepare pricing for their bids, without the companies knowing of each other’s bids. Hence, the pricing similarities. The companies had accounts (business relationships) with the stationery supplier whom they approached for quotes and confirmation of supply. They argued, however, that this could not be construed as collusive tendering.
The companies also argued, among others, that the prices submitted as part of their bids were not actual selling or purchase prices because, from the outset, it was clearly understood that the final purchase price would be determined through negotiations between the Free State Provincial Treasury and those bidders who had met the bid requirements (and had scored sufficiently high regarding the functionality requirements).