Competition Commission of South Africa v Uniplate Group (Pty) Ltd (CR188Nov15) [2019] ZACT 61 (27 June 2019)

Competition Commission of South Africa v Uniplate Group (Pty) Ltd (CR188Nov15) [2019] ZACT 61 (27 June 2019)

The Tribunal found that Uniplate's exclusive supply agreements required embossers to purchase all number plate blanks from Uniplate, regardless of machine type, for excessively long periods (typically 10 years, often automatically renewed). These contracts foreclosed the market to competitors, raised barriers to entry, and harmed customers through higher prices and reduced choice. The evidence showed that customers were unable to terminate contracts easily and faced threats of litigation if they attempted to switch suppliers. The claimed efficiencies—subsidised machine prices, prevention of free riding, and maintenance—were not substantiated by evidence and did not outweigh the...

Citation
[2019] ZACT 61
Parties
Applicant: Competition Commission of South Africa; Respondent: Uniplate Group (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
27 June 2019
Case Number
CR188Nov15
Procedural Posture
Competition Enforcement / Order and Reasons
Outcome
Uniplate Group (Pty) Ltd found to have contravened section 8(d)(i) of the Competition Act for the period 2010-2014. Administrative penalty imposed.
Judges
Yasmin Carrim, Enver Daniels, Mondo Mazwai
Legal Topics
Abuse of Dominance, Exclusive Dealing, Vertical Tying, Administrative Penalty, Market Definition, Foreclosure Effects
Competition Law Commercial and Corporate Abuse of Dominance Exclusive Dealing Vertical Tying Administrative Penalty Market Definition Foreclosure Effects

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Parties

Competition Commission of South Africa

Applicant

Uniplate Group (Pty) Ltd

Respondent

Procedural Posture

Competition Enforcement / Order and Reasons

Legal Issues

  1. 1 Whether Uniplate Group (Pty) Ltd abused its dominance by requiring customers to exclusively purchase number plate blanks from it when acquiring embossing machines.
  2. 2 Whether the exclusive supply agreements substantially foreclosed the market to competitors and harmed customers.
  3. 3 Whether Uniplate's conduct contravened section 8(d)(i) of the Competition Act.

Ratio Decidendi

The Tribunal found that Uniplate's exclusive supply agreements required embossers to purchase all number plate blanks from Uniplate, regardless of machine type, for excessively long periods (typically 10 years, often automatically renewed). These contracts foreclosed the market to competitors, raised barriers to entry, and harmed customers through higher prices and reduced choice. The evidence showed that customers were unable to terminate contracts easily and faced threats of litigation if they attempted to switch suppliers. The claimed efficiencies—subsidised machine prices, prevention of free riding, and maintenance—were not substantiated by evidence and did not outweigh the...

Court Disposition

Uniplate Group (Pty) Ltd found to have contravened section 8(d)(i) of the Competition Act for the period 2010-2014. Administrative penalty imposed.

Orders

  • Uniplate has contravened section 8(d)(i) of the Act in the period 2010-2014.
  • Uniplate must pay an administrative penalty of R16 192 315.