Vexall Proprietary Limited v Business Connexion Proprietary Limited and Another (IR119Oct19) [2020] ZACT 85 (12 February 2020)
The Tribunal found that BCX's practice of selling Unisolv licences on condition that customers also purchase value-added services constituted a prima facie tying arrangement and potential abuse of dominance under the Competition Act. The applicant demonstrated imminent harm to competition and customers if the...
Source-derived case information.
- Citation
- [2020] ZACT 85
- Parties
- Applicant: Vexall Proprietary Limited; Respondent: Business Connexion Proprietary Limited; Respondent: Competition Commission
- Court
- Competition Tribunal
- Jurisdiction
- South Africa
- Case Number
- IR119Oct19
- Procedural Posture
- Urgent Application / Order Issued After Hearing
- Outcome
- Interim relief granted prohibiting BCX from tying the sale of Unisolv licences to value-added services; costs awarded to applicant.
- Judges
- Yasmin Carrim, Anton Roskam, Halton Cheadle
- Legal Topics
- Interim Relief, Tying Arrangements, Abuse of Dominance, Section 49c Order
Source-derived case record
Summary, issues, holding and outcome
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Parties
Vexall Proprietary Limited
Applicant
Business Connexion Proprietary Limited
Respondent
Competition Commission
Respondent
Procedural Posture
Urgent Application / Order Issued After Hearing
Legal Issues
- 1 Whether BCX's sale of Unisolv licences was unlawfully tied to the purchase of value-added services.
- 2 Whether interim relief should be granted to prohibit BCX from imposing such tying arrangements.
- 3 Whether the applicant is entitled to costs.
Ratio Decidendi
The Tribunal found that BCX's practice of selling Unisolv licences on condition that customers also purchase value-added services constituted a prima facie tying arrangement and potential abuse of dominance under the Competition Act. The applicant demonstrated imminent harm to competition and customers if the conduct continued. The Tribunal was satisfied that the requirements for interim relief under section 49C were met and accordingly prohibited BCX from imposing such conditions for a period of six months or until the complaint hearing is concluded, whichever occurs first. Costs were awarded to the applicant.
Court Disposition
Interim relief granted prohibiting BCX from tying the sale of Unisolv licences to value-added services; costs awarded to applicant.
Orders
- BCX is prohibited from selling or offering a Unisolv licence on condition that a customer purchases value-added services from BCX.
- This prohibition remains in force for six months from the date of the order or until the conclusion of a hearing into the complaint, whichever is earlier.
Full Case Text
Judgment text and source record
27 paragraphs
COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No: IR119Oct19
In the matter between:
VEXALL PROPRIETARY LIMITED Applicant
And
BUSINESS CONNEXION PROPRIETARY LIMITED First
Respondent
THE COMPETITION COMMISSION Second
Respondent
Panel: Yasmin Carrim (Presiding Member), Anton Roskam (Tribunal Member),Halton Cheadle (Tribunal Member)
Heard on: 3 February 2020
Order issued on: 12 February 2020
ORDER
KINDLY TAKE NOTICE THAT having heard the parties, the Competition Tribunal issues the following order in terms of section 49C of the Competition Act 89 of 1998, as amended ("the Act") in the following terms:
1. For the purposes of this order the following terms mean-
a. 'BCX' means the First Respondent;
b. 'complaint' means the complaint referred to the Competition Commission by the Applicant on 16 October 2019;
c. 'customer' means a customer of the Unisolv licence supplied by BCX;
d. 'Unisolv licence' means the use of the Unisolv software and any upgrades, bug fixes, repairs or additional coding to the software;
e. 'software support services' means those support services related to the upgrading and repairing of the Unisolv software provided by BCX;
f. 'value added services' includes BCX's Data Bureau Service, its Electronic Remittance Services and support services other than software support services.
2. From the date of this order BCX is prohibited from selling or offering a Unisolv license on condition that a customer purchases value-added services from BCX.
3. The order in paragraph 2 remains in force for 6 months from date of this order or the conclusion of a hearing into the complaint, whichever is the earlier.
4. BCX to pay Applicant's costs of the application.
Ms Yasmin Carrim
Mr Anton Roskam and Prof. Halton Cheadle concurring.
Date: 12 February 2020