Competition Commission v Hochtief Construction AG (016998) [2013] ZACT 70 (22 July 2013)

Competition Commission v Hochtief Construction AG (016998) [2013] ZACT 70 (22 July 2013)

The Tribunal found that Hochtief Construction AG, in joint venture with Concor, entered into a losers' fee arrangement with other competitors in the Berg River Dam project, amounting to collusive tendering in contravention of section 4(1)(b)(iii) of the Competition Act. Hochtief admitted the contravention, provided full cooperation, and undertook to cease prohibited practices and implement a compliance programme. The administrative penalty was calculated in accordance with the Commission's invitation and the provisions of the Act. The Tribunal confirmed the consent agreement as an order, concluding all proceedings between the Commission and Hochtief regarding the disclosed conduct.

Citation
[2013] ZACT 70
Parties
Applicant: Competition Commission; Respondent: Hochtief Construction AG
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
22 July 2013
Case Number
016998
Procedural Posture
Consent Order Application / Order Confirming Consent Agreement
Outcome
Consent agreement confirmed as an order of the Tribunal. Administrative penalty imposed.
Judges
N Manoim, Y Carrim, T Madima
Legal Topics
Collusive Tendering, Administrative Penalty, Consent Agreement, Losers Fee Arrangement
Competition Law Collusive Tendering Administrative Penalty Consent Agreement Losers Fee Arrangement

Case Brief

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Parties

Competition Commission

Applicant

Hochtief Construction AG

Respondent

Procedural Posture

Consent Order Application / Order Confirming Consent Agreement

Legal Issues

  1. 1 Whether Hochtief Construction AG engaged in collusive tendering in contravention of section 4(1)(b)(iii) of the Competition Act.
  2. 2 Whether the consent agreement between the Competition Commission and Hochtief should be confirmed as an order of the Tribunal.
  3. 3 Whether the administrative penalty imposed is appropriate under the Competition Act.

Ratio Decidendi

The Tribunal found that Hochtief Construction AG, in joint venture with Concor, entered into a losers' fee arrangement with other competitors in the Berg River Dam project, amounting to collusive tendering in contravention of section 4(1)(b)(iii) of the Competition Act. Hochtief admitted the contravention, provided full cooperation, and undertook to cease prohibited practices and implement a compliance programme. The administrative penalty was calculated in accordance with the Commission's invitation and the provisions of the Act. The Tribunal confirmed the consent agreement as an order, concluding all proceedings between the Commission and Hochtief regarding the disclosed conduct.

Court Disposition

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

Orders

  • The consent agreement between the Competition Commission and Hochtief Construction AG is confirmed as an order of the Tribunal.
  • Hochtief Construction AG shall pay an administrative penalty of ZAR 1,315,719 to the Competition Commission within thirty (30) days of confirmation of the consent agreement.