Phutuma Networks (Pty) Ltd v Telkom SA Ltd (37/CR/July10) [2011] ZACT 12; [2011] 1 CPLR 213 (CT) (2 March 2011)

Phutuma Networks (Pty) Ltd v Telkom SA Ltd (37/CR/July10) [2011] ZACT 12; [2011] 1 CPLR 213 (CT) (2 March 2011)

The Tribunal found that Phutuma's complaint failed to establish a cause of action under section 8(c) of the Competition Act. The founding affidavit did not delineate a relevant market, did not establish Telkom's dominance in any such market, and did not demonstrate that Telkom's conduct constituted an exclusionary act impeding Phutuma's entry or expansion. The Tribunal rejected the proposition that a dominant firm is obliged under competition law to follow public procurement procedures or that failure to do so automatically constitutes an exclusionary act. The Tribunal's jurisdiction is limited to competition law and does not extend to administrative or constitutional law issues....

Citation
[2011] ZACT 12
Parties
Applicant: Phutuma Networks (Proprietary) Limited; Respondent: Telkom SA Limited
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
2 March 2011
Case Number
37/CR/July10
Procedural Posture
Exception Application / Exception Raised in Limine; Decision on Whether Complaint Discloses a Cause of Action Under Section 8(c) of the Competition Act
Outcome
Exception upheld; complaint dismissed for failure to disclose a cause of action under section 8(c) of the Competition Act.
Judges
N Manoim, Y Carrim, L Reyburn
Legal Topics
Abuse of Dominance, Exclusionary Act, Public Procurement, Relevant Market Definition
Competition Law Commercial and Corporate Abuse of Dominance Exclusionary Act Public Procurement Relevant Market Definition

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Parties

Phutuma Networks (Proprietary) Limited

Applicant

Telkom SA Limited

Respondent

Procedural Posture

Exception Application / Exception Raised in Limine; Decision on Whether Complaint Discloses a Cause of Action Under Section 8(c) of the Competition Act

Legal Issues

  1. 1 Whether the complaint by Phutuma discloses a cause of action under section 8(c) of the Competition Act.
  2. 2 Whether Telkom's appointment of Network Telex without a tender constitutes an exclusionary act under competition law.
  3. 3 Whether the relevant market was properly delineated and Telkom's dominance established for purposes of section 8(c).

Ratio Decidendi

The Tribunal found that Phutuma's complaint failed to establish a cause of action under section 8(c) of the Competition Act. The founding affidavit did not delineate a relevant market, did not establish Telkom's dominance in any such market, and did not demonstrate that Telkom's conduct constituted an exclusionary act impeding Phutuma's entry or expansion. The Tribunal rejected the proposition that a dominant firm is obliged under competition law to follow public procurement procedures or that failure to do so automatically constitutes an exclusionary act. The Tribunal's jurisdiction is limited to competition law and does not extend to administrative or constitutional law issues....

Court Disposition

Exception upheld; complaint dismissed for failure to disclose a cause of action under section 8(c) of the Competition Act.

Orders

  • The exception is upheld.
  • The complaint is dismissed.