KEY CONTACTS
Director National Practice Head: Competition
Director Regional Practice Head: Competition
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Competition/Antitrust
Corporate Leniency Policy
Basic Provisions
- A
Corporate
Leniency Policy has been published by the Commission in terms of section 79
of the Competition Act No. 89 of 1998. The policy has been developed as a
guideline to grant leniency to a qualifying firm that has been a member of a
cartel.
Successful disclosures and cooperation with the Commission
under the Corporate Leniency Policy can lead to full immunity for firms from
civil prosecution for participation in cartel by the competition
authorities.
- In terms of section 4(1)(b) of the Act, an agreement, whether
or not legally enforceable, between competitors (who, collectively, are
commonly referred to as a cartel) is outlawed and would lead to censure if it
involves:
- directly or indirectly fixing a purchase or selling price
or any other trading condition;
- dividing markets by allocating customers, suppliers,
territories, or specific types of goods or services; and
- collusive tendering.
- The Commission may grant full immunity or reduce the
administrative penalty payable by a self confessing cartel member if it assists
the Commission in the investigation of the anti-competitive behaviour. Full
immunity from fines and civil prosecution under the Act is available if the
applicant meets the conditions set by the Commission.
- Immunity can be revoked at any time if the applicant fails to
co-operate, misrepresents the facts, is dishonest or fails to meet any of the
conditions prescribed for immunity.
Procedure for Application
- The application must be made in writing, and contain sufficient
information for the Commission to identify the cartel conduct and its
participants. The applicant does not have to disclose its identity at this
stage. If the applicant might qualify for immunity, conditional immunity will
be granted by the Commission, after meetings with the Commission and pending
further investigation into the activities of the cartel.
- Once the Commission has finalised its investigations and is
satisfied that it has sufficient information to institute proceedings in
respect of the cartel in the Tribunal, a further meeting is arranged with the
applicant at which full immunity may be granted. Full immunity will require the
applicant to fully co-operate on all issues concerning the cartel activity. In
return, the Commission undertakes not to prosecute or fine the applicant.
- The Commission treats all information given to it by the
applicant, throughout the process, as confidential. However, the Commission
reserves the right to use such information in any subsequent prosecutions in
the Tribunal against other cartel members.
Maximum Penalty for Breach of Cartel Laws
- The maximum penalty is 10% of the firm's previous financial
year's annual turnover and will depend, inter alia, on the nature, duration,
gravity and extent of the violation, any loss of damage suffered, behaviour of
the firm concerned, the market circumstances, the profit derived from the
violation, the level of co-operation with the authorities, and whether the firm
has previously been found in violation of the Act.
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