Commission accuses cable companies of cartel conduct - CNBC Africa

Commission accuses cable companies of cartel conduct

Southern Africa

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Electric cable wires. PHOTO: Getty Images

After an investigation was initiated in 2010, the Commission conducted a search and seizure operation against certain power cable suppliers namely, Alvern Cables, South Ocean Electric Wire Company (SOEW), Tulisa Cables and Aberdare Cables for possible price fixing and market allocation contraventions.

“The Commission found that between 2001 to at least 2010, the firms directly or indirectly fixed the selling prices of power cables to wholesalers, distributors and original equipment manufacturers,” said the Commission in a statement.

Customers that have been affected are the Bidvest Group, ARB Holdings, Universal Cables, Trinity Cables, Powermac Paragons, South Atlantic Cables and Electrobase.

“It was furthermore found that from about 2001 to at least end 2007, Aberdare agreed, with SOEW and Alvern respectively to divide markets by allocating customers,” continued the statement.

The commission stated that the cable firms would have regular meetings and telephone conversation to discuss power cable price adjustments when there was a significant change in prices of input materials.

The Commission has requested that the Competition Tribunal impose an administrative penalty of ten percent of annual turnover on each of the firms involved, except for Aberdare who has been granted conditional leniency.

Acting Commissioner, Tembinkosi Bonakele, stated that the Commission has been working tirelessly on South Africa’s image as a destination for foreign investment.

“Our country continues to be a friendly destination for foreign investment, and with an economy that works progressively for both the local and international businesses. We have been working tirelessly to thwart any effort that goes to undermine South Africa’s global position that provides value to businesses. Our steadily growing economy can ill-afford rogue business practices,” said Bonakele.

“As a regulatory body with a powerful mandate in our young democracy, we have a responsibility to ensure that the market place is free of anticompetitive behaviour including collusion which simply put, robs the citizens of our country who are the end users. We are grateful for those that cooperate and wish to encourage citizens to be part of alerting the Commission and providing us with invaluable information to help us uproot the unacceptable anti-competitive practices.”

(READ MORE: S.Africa's corruption watch closing in on corrupt bid-riggers

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