1 December 2014 by Cliffe Dekker Hofmeyr Competition Matters

Commission refers complaint against members of the Association of Electric Cable Manufacturers of South Africa

The Competition Commission, earlier this month, referred a complaint against all the members of the Association of Electric Cable Manufacturer of South Africa (AECMSA). The members of AECMSA allegedly contravened the provisions of the Competition Act, No 89 of 1998 (Act) by fixing the prices of power cables, dividing these markets and tendering collusively.

This alleged conduct occurred under the auspices of AECMSA by virtue of the agreed price escalation formula used by the members of AECMSA as the basis for increasing prices when bidding for short and long term tenders for the supply of power cables.

This referral, again, highlights the importance of firms being mindful of their engagement in industry associations, especially before implementing any industry approved formula for price escalation or exchanging possibly competitively sensitivity information, as firms can unknowingly engage in conduct that contravenes the Act or which, at least, invite scrutiny from the competition authorities.

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