A'Africa Pest Prevention CC and Another v Competition Commssion of South Africa (168/CAC/Oct18) [2019] ZACAC 2 (2 July 2019)

A'Africa Pest Prevention CC and Another v Competition Commssion of South Africa (168/CAC/Oct18) [2019] ZACAC 2 (2 July 2019)

The court held that, although the appellants operated with a high degree of commercial unity and shared management, their structure did not meet the statutory requirements for exemption under section 4(5)(b) of the Competition Act. The ownership and control of the close corporations were not analogous to a parent and wholly-owned subsidiary, as required by the Act. The court found that the submission of identical bids, determined by the same individual, did not amount to collusive tendering or price fixing in the absence of evidence of an agreement or concerted practice between independent firms. The conduct lacked the hallmarks of collusion, as there was no separate consciousness or...

Citation
[2019] ZACAC 2
Parties
Appellant: A'Africa Pest Prevention CC; Appellant: Mosebetsi Mmoho Professional Services CC; Respondent: Competition Commission of South Africa
Court
Competition Appeal Court
Jurisdiction
South Africa
Judgment Date
2 July 2019
Case Number
168/CAC/Oct18
Procedural Posture
Civil Appeal / Appeal From Competition Tribunal
Outcome
Appeal upheld; Tribunal's decision set aside; complaint dismissed.
Judges
Boqwana JA, Victor JA, Van der Linde AJA
Legal Topics
Single Economic Entity, Collusive Tendering, Price Fixing, Horizontal Relationships, Characterisation of Conduct
Competition Law Commercial and Corporate Single Economic Entity Collusive Tendering Price Fixing Horizontal Relationships Characterisation of Conduct

Case Brief

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Parties

A'Africa Pest Prevention CC

Appellant

Mosebetsi Mmoho Professional Services CC

Appellant

Competition Commission of South Africa

Respondent

Procedural Posture

Civil Appeal / Appeal From Competition Tribunal

Legal Issues

  1. 1 Whether the appellants were constituent firms within a single economic entity similar in structure to those referred to in section 4(5)(a) of the Competition Act.
  2. 2 Whether the conduct of submitting identical tender bids constituted price fixing or collusive tendering in contravention of section 4(1)(b) of the Competition Act.
  3. 3 Whether the Tribunal erred in its interpretation and application of section 4(5) and the characterisation of the conduct.

Ratio Decidendi

The court held that, although the appellants operated with a high degree of commercial unity and shared management, their structure did not meet the statutory requirements for exemption under section 4(5)(b) of the Competition Act. The ownership and control of the close corporations were not analogous to a parent and wholly-owned subsidiary, as required by the Act. The court found that the submission of identical bids, determined by the same individual, did not amount to collusive tendering or price fixing in the absence of evidence of an agreement or concerted practice between independent firms. The conduct lacked the hallmarks of collusion, as there was no separate consciousness or...

Court Disposition

Appeal upheld; Tribunal's decision set aside; complaint dismissed.

Orders

  • The appeal is upheld with costs, including costs of two counsel.
  • The decision of the Tribunal is set aside and replaced with an order dismissing the complaint.