Competition Commission v Cycad Pipelines (Pty) Ltd (019224) [2014] ZACT 100 (19 August 2014)

Competition Commission v Cycad Pipelines (Pty) Ltd (019224) [2014] ZACT 100 (19 August 2014)

The Tribunal found that Cycad Pipelines (Pty) Ltd admitted to engaging in collusive tendering by agreeing with competitors to pay loser’s fees in the Thabazimbi (Northam) Pipeline project, in contravention of section 4(1)(b)(iii) of the Competition Act. Cycad provided full cooperation, ceased the prohibited conduct, and undertook to implement a compliance programme. The Tribunal considered the settlement agreement, including the administrative penalty of R3,394,151 (2% of annual turnover), to be appropriate and in line with the Act’s objectives. Accordingly, the Tribunal confirmed the settlement agreement as an order under section 58(1)(a).

Citation
[2014] ZACT 100
Parties
Applicant: Competition Commission; Respondent: Cycad Pipelines (Pty) Ltd
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
19 August 2014
Case Number
019224
Procedural Posture
Consent Order Application / Order Confirming Settlement Agreement
Outcome
Settlement agreement confirmed as an order of the Tribunal. Administrative penalty imposed.
Judges
N Manoim, M Mokuena, Y Carrim
Legal Topics
Collusive Tendering, Administrative Penalty, Section 4 1 B Iii, Settlement Agreement
Competition Law Commercial and Corporate Collusive Tendering Administrative Penalty Section 4 1 B Iii Settlement Agreement

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Parties

Competition Commission

Applicant

Cycad Pipelines (Pty) Ltd

Respondent

Procedural Posture

Consent Order Application / Order Confirming Settlement Agreement

Legal Issues

  1. 1 Whether Cycad Pipelines (Pty) Ltd contravened section 4(1)(b)(iii) of the Competition Act by engaging in collusive tendering.
  2. 2 Whether the settlement agreement between the Commission and Cycad should be confirmed as an order of the Tribunal.
  3. 3 Whether the administrative penalty imposed is appropriate under the Act.

Ratio Decidendi

The Tribunal found that Cycad Pipelines (Pty) Ltd admitted to engaging in collusive tendering by agreeing with competitors to pay loser’s fees in the Thabazimbi (Northam) Pipeline project, in contravention of section 4(1)(b)(iii) of the Competition Act. Cycad provided full cooperation, ceased the prohibited conduct, and undertook to implement a compliance programme. The Tribunal considered the settlement agreement, including the administrative penalty of R3,394,151 (2% of annual turnover), to be appropriate and in line with the Act’s objectives. Accordingly, the Tribunal confirmed the settlement agreement as an order under section 58(1)(a).

Court Disposition

Settlement agreement confirmed as an order of the Tribunal. Administrative penalty imposed.

Orders

  • The settlement agreement between the Competition Commission and Cycad Pipelines (Pty) Ltd is confirmed as an order of the Tribunal under section 58(1)(a) of the Competition Act.
  • Cycad Pipelines (Pty) Ltd must pay an administrative penalty of R3,394,151 to the Commission within 30 days of confirmation of the order.