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Johannesburg - The case of an alleged mesh wire cartel is to be heard by the Competition Tribunal next week. It was referred to the tribunal by the Competition Commission in December 2009.
The commission alleged that, in the period between 2001 and 2008, Aveng (trading as Steeldale Mesh), Capital Africa Steel (trading as Reinforcing & Mesh Solutions), Vulcania Reinforcing and BRC Mesh Reinforcing were involved in price-fixing and market allocation in contravention of the Competition Act.
Aveng [JSE: AEG] and RMS have both admitted their roles in the cartel but are set to argue for a penalty of less than the 10% of their total turnover, which the commission has requested.
Vulcania, on the other hand, has denied that it took part in the cartel. The commission granted conditional immunity from prosecution to BRC, a subsidiary of Murray and Roberts Steel, and therefore did not request a penalty against it.
The tribunal is set to hear evidence in this case from February 28 to March 4. Closing arguments would take place on March 11.
The commission initiated an investigation into this cartel activity following information received from a leniency application by Murray and Roberts Steel on behalf of its subsidiary, BRC, on September 26 2008.
In the application, Murray and Roberts Holdings [JSE:MUR] admitted to participating in the cartel and was granted conditional immunity from prosecution provided that it cooperated with the commission in the investigation and prosecution of the cartel.
In its probe, the commission found that the respondents contravened the Competition Act by engaging in price-fixing and market allocation. This was done through monthly formal meetings under the auspices of the South African Fabric Reinforcing Association (Safra).
After the respondents were advised that their conduct was in contravention of the law, the formal meetings were largely replaced by informal meetings, which were held in restaurants, on golf courses and in pubs.
The four respondents allegedly agreed to fix the selling price and discounts for reinforcing mesh products, and to not sell to or target each other's customers.
The commission alleged that, in the period between 2001 and 2008, Aveng (trading as Steeldale Mesh), Capital Africa Steel (trading as Reinforcing & Mesh Solutions), Vulcania Reinforcing and BRC Mesh Reinforcing were involved in price-fixing and market allocation in contravention of the Competition Act.
Aveng [JSE: AEG] and RMS have both admitted their roles in the cartel but are set to argue for a penalty of less than the 10% of their total turnover, which the commission has requested.
Vulcania, on the other hand, has denied that it took part in the cartel. The commission granted conditional immunity from prosecution to BRC, a subsidiary of Murray and Roberts Steel, and therefore did not request a penalty against it.
The tribunal is set to hear evidence in this case from February 28 to March 4. Closing arguments would take place on March 11.
The commission initiated an investigation into this cartel activity following information received from a leniency application by Murray and Roberts Steel on behalf of its subsidiary, BRC, on September 26 2008.
In the application, Murray and Roberts Holdings [JSE:MUR] admitted to participating in the cartel and was granted conditional immunity from prosecution provided that it cooperated with the commission in the investigation and prosecution of the cartel.
In its probe, the commission found that the respondents contravened the Competition Act by engaging in price-fixing and market allocation. This was done through monthly formal meetings under the auspices of the South African Fabric Reinforcing Association (Safra).
After the respondents were advised that their conduct was in contravention of the law, the formal meetings were largely replaced by informal meetings, which were held in restaurants, on golf courses and in pubs.
The four respondents allegedly agreed to fix the selling price and discounts for reinforcing mesh products, and to not sell to or target each other's customers.
