Corobrik charged for price fixing after probe

Cape Town - Corobrik and five other brick makers have been charged for price fixing and division of markets, the Competition Commission announced in a statement on Wednesday.

Corobrik, which is a well-known manufacturer and supplier of bricks, pavers including clay and concrete blocks in South Africa, has been under investigation for contravening the Competition Act.

The Commission in April this year also probed Era Bricks, Eston Brick and Tile, De Hoop Brickfields, Clay Industry and Kopano Brickworks for contravening the Competition Act, by engaging in price fixing and division of markets in the manufacturing and supply of bricks, pavers and blocks of clay and concrete.

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"Corobrik entered into separate bilateral agreements with each of the above companies in terms of which they agreed to divide the market by allocating specific products and/or customers in contravention of section 4(1)(b) (ii) of the Competition Act," said the Commission.

In addition, Corobrik and Era Bricks agreed to fix prices at which they sold bricks, pavers and blocks in contravention of section 4(1)(b)(i).

The Commission revealed that Corobrik and Era Bricks concluded a Memorandum of Agreement that Era Bricks would not supply its products directly to customers in competition with Corobrik, but instead would sell directly to Corobrik who would then sell to customers in the open market.

It also found that Era Bricks would not manufacture or sell any bricks other than the types it was manufacturing and selling to Corobrik.

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"In addition, it would not manufacture or sell any competitive product capable of being utilised in the brick industry in substitution for bricks."

The deal also included that in the event that Era Bricks had excess products, Era Bricks agreed not to sell such excess products at prices that were lower than those charged by Corobrik.

Corobrik further concluded separate bilateral distributorship agreement with each of Eston Brick, Clay Industry, De Hoop and Kopano wherein each of Eston Brick, Clay Industry, De Hoop and Kopano agreed with Corobrik that they would not supply their respective products directly to customers in competition with Corobrik.

Instead, they will each supply their respective products to Corobrik which would then sell directly to customers.

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