Publications
Partners
Johannesburg - SA's competition authorities, which levied local companies about R330m in penalties for anticompetitive behaviour in the previous financial year, said penalties have to be stiffer and more severe the longer a firm has benefited from collusive practices.
Presenting the Competition Commission's annual report in parliament on Wednesday, commissioner Shan Ramburuth said its successes, including beefed-up legislation, were changing corporate SA's culture into a less collusive one. As proof, Ramburuth said law firms experienced an increase in demand from companies to evaluate their compliance.
Deputy commissioner Tembinkosi Bonakele, however, believed penalties could be stiffer, especially for companies that have been benefiting from anticompetitive behaviour for a long time.
He conceded it wasn't fair that fines were the same for all companies caught colluding, no matter if they had been doing so for six months or 30 years.
Cartel members found guilty of contravening competition laws are fined up to 10% of the firm's annual turnover in South Africa in the preceding financial year.
Ramburuth agreed that for some firms the penalties were tantamount to a slap on the wrist, although not "inconsequential".
Amendments to competition legislation - which allowed directors and executives to be held criminally and personally liable for their firms' collusive behaviour - have also given companies a lot more to think about, argued the commissioners.
According to legislation, directors and executives can opt for a leniency process in the hope of providing a safe haven for their firm. But they do so knowing they are exposing themselves to a possible criminal record, a R500 000 fine and/or 10 years in jail.
Critics believed this would significantly hinder the commission's cartel-busting efforts, especially because parliament saw fit to keep the controversial "reverse onus" clause in the amended legislation President Jacob Zuma has signed into law.
This onus meant that if the Competition Tribunal finds a firm guilty of cartel behaviour or if a firm admits to it, it can serve as prima facie proof in a criminal trial against a director or manager of that firm.
- Fin24.com
