On 14 November 2012 the Competition Appeal Court (CAC) upheld an
appeal by the Competition Commission against a decision of the
Competition Tribunal, which set aside the Commission's
complaint referral against South African Breweries Limited (SAB)
and several of its independent distributors.
The referral originated from the Commission's investigation of a complaint lodged by various retail and wholesale alcohol distributors. The Commission's referral was based on evidence of collusion, price discrimination, and anti-competitive conduct between a manufacturer and its suppliers, including the setting of a minimum price.
The Commission further alleged that, in terms of its wholesaler and franchise agreements, SAB appointed independent distributors in various locations. These distributors were not permitted to compete with one another in the territories in which they were allocated. The Commission also alleged that SAB would not undercut its distributors to prevent customers purchasing directly from SAB.
The Commission concluded that SAB's conduct constituted the unlawful division and allocation of a market and/ or customers, and that the company was a party to an anti-competitive agreement between parties in a vertical relationship. The Commission as result extended the complaint to include the setting of a minimum price as well as price discrimination.
The CAC ruled that the essential question to be determined was whether the complaint that formed part of the initiating documents and the referral of the Commission contained the same complaint that was lodged by the various retail and wholesale alcohol distributors.
After a factual analysis, the CAC concluded that the initial complaint lodged by the alcohol distributors was sufficiently broad that, following an investigation, the Commission was able to more specifically define and amplify the various contraventions of the Competition Act.
The final referral to the Tribunal therefore sufficiently reflected the original complaint. The CAC granted the appeal and set aside the decision of the Tribunal. As result, the merits of the Commission's referral against SAB and the other respondents may now be heard by the Tribunal.
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