Watchdog urges millers to 'come clean'

Johannesburg - Firms involved in cartel activity in the milling sector should "come clean", the Competition Commission said on Thursday.

"In return, a firm that fully cooperates with the commission will receive favourable settlement terms," it said in a statement.

The commission said this was a "once-off offer" and cooperation meant full disclosure relating to the firm's participation in, or information about, cartel activity in the milling of white maize and wheat.

"Since the commission's referral of the two cartel cases against millers of flour and white maize to the Competition Tribunal, it has received numerous approaches from the firms that were involved in what seems like endemic cartel arrangements at many regions in the country."

The commission said that the regional arrangements involved "a lot of new players" not cited in the cases referred to the tribunal.

It appeared that the regional arrangements reinforced, overlapped and completed the national cartel arrangements.

"As such the milling cartel is far... wider and involves many firms that were previously uncovered."
  
The commission said it had already concluded settlement terms with some of the firms which had approached it - including Tiger Brands and Premier Foods - and was in settlement discussions with others.

"This communiqué is targeted at firms that were part of the cartel, especially at regional level, whether or not they are cited as respondents in the current cases before the tribunal.

"This gives an opportunity to largely small regional based millers involved in these arrangements to clean up their companies and settle the matters without litigation."

The commission gave the companies involved until June 30 to approach it to settle these cases.

"After this date the offer will lapse and the commission reserves its right to seek maximum penalties from the tribunal."

 - Sapa