Tribunal dismisses Commission’s bid to amend complaint referral
in Sanral tender collusion case

The Competition Tribunal has dismissed an application by the Commission in which it sought to amend and supplement a complaint referral relating to a Sanral tender collusion case.
 
In August 2018, the Tribunal heard the Commission’s application to extend the scope of the complaint referral such that Power Construction (Pty) Ltd would be cited as having contravened the Competition Act by engaging in collusive conduct.
 
The Tribunal has issued its Order today, dismissing the Commission’s application for leave to amend its complaint referral. The Order and Reasons are available on the Tribunal’s website via the link below:

In December 2014, the Commission referred a case to the Tribunal in which it alleged that Power Construction (West Cape) (Pty) Ltd (“West Cape”) and Haw and Inglis (Pty) Ltd (“H&I”) colluded in respect of a Sanral tender to maintain a section of the N1 national route.
 
The Commission alleged that West Cape had submitted a bid with no intention of rendering the services. This was allegedly done on H&I’s instruction to ensure that Sanral received enough bids to award the contract in terms of its tender processes. The tender project was ultimately awarded to H&I.
 
In its referral, the Commission sought an order that West Cape had contravened the Competition Act. The Commission wanted Power Construction (Pty) Ltd to pay the administrative penalty in this regard, as West Cape had been transferred to Power Construction as a going concern in July 2007. There were, however, no allegations in the original referral that Power Construction had contravened the Act.
 
Following arguments in the Tribunal and the Competition Appeal Court, Power Construction made a with-prejudice settlement offer to the Commission. The Commission declined the offer, saying it had subsequently established that West Cape and Power Construction shared most of their directors. It argued that this would be sufficient to implicate Power Construction in the collusive conduct. As such, the Commission believed that Power Construction’s higher turnover figures (and not the figures of West Cape) needed to be used to calculate the fine.
 
The companies denied this and said Power Construction’s figures could not be used, as it had never been alleged that the company had contravened the Act. The Commission then moved to amend the initial referral to reflect that Power Construction should be implicated along with West Cape.