30 November 2015 Competition Matters

Constitutional Court dismisses commission’s appeal in Sasol excessive pricing case

In May 2015, the Competition Tribunal imposed a staggering R500 million administrative penalty on Sasol Chemical Industries Limited (SCI), as a dominant firm in the supply of purified propylene and polypropylene, for charging excessive prices in contravention of s8(a) of the Competition Act, No 89 of 1998 (the Act).

SCI appealed the decision of the Tribunal to the Competition Appeal Court (CAC). The
CAC released its judgment in this matter on 17 June 2015 and overturned the decision of the Tribunal, concluding that SCI’s higher price was not unreasonable so as to render the price excessive and in contravention of s8(a) of the Act.

Subsequently, the Commission applied for leave to appeal the CAC’s decision to the Constitutional Court. On 16 November 2015, the Constitutional Court dismissed the Commission’s application and did not grant it leave to appeal the matter. Consequently, the CAC’s decision in this matter stands.

The Commission, in a press release, stated that it was disappointed in this outcome and that it “remains concerned about the pricing behaviour of dominant firms operating upstream, especially in markets with high levels of concentration. For this reason, the Commission will go back to the drawing board to determine its next approach to handling excessive pricing complaints going forward.”

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