South Africa: Cartels criminalised in South Africa


For the first time in South Africa, directors and managers will face jail time for participation in a cartel. Amendments to the Competition Act which introduce personal criminal liability for cartel conduct came into effect from 1 May 2016.

The amendment introduces criminal liability for directors and individuals with 'management authority' who are responsible for - or knowingly acquiesce in - cartel conduct. Cartel conduct includes the direct or indirect fixing of prices (including purchase prices) and trading conditions, market division, and collusive tendering among competitors or potential competitors. All members of the management chain (not only directors) are potentially at risk of prosecution.

An individual can only be charged if the company involved has already been found to have contravened the cartel provisions by the Competition Tribunal, or it has admitted a contravention in a formal consent order. The vast majority of cartel cases investigated by the Competition Commission in South Africa to date have been resolved through consent agreements. This development means that firms accused of engaging in cartel conduct will have to think more carefully before admitting to a contravention to settle a case for commercial reasons.

It is intended that individuals will be able to apply for leniency from the competition authorities the same way that companies currently can. The current policy allows only the firm "first through the door" to be granted immunity from an administrative penalty if it can provide sufficient information to enable the Competition Commission to successfully prosecute other firms for cartel conduct. It is therefore not clear whether an individual can be granted leniency if the firm they work or worked for has not applied for leniency. Amendments are required to the Competition Commission's Corporate Leniency Policy to cater for this development. Because enforcement of this offence will be handled by the Department of Public Prosecutions and the criminal courts, immunity from the competition authorities may not be enough to shield managers from prosecutions. The amendment does provide that the Competition Commission may make submissions to the National Prosecuting Authority that an individual should not be prosecuted when the Commission views that individual as "deserving of leniency".

The Competition Commission is in the process of negotiating a memorandum of understanding with the National Prosecuting Authority to determine how the criminal prosecution of these offences will be handled, including the leniency regime. There is some suggestion that the Competition Commission will ramp up its internal capabilities and work collaboratively with the National Prosecuting Authority on the criminal aspect of cartel investigations as is done in some other jurisdictions with both civil and criminal consequences for collusive conduct. Notably however, the competition authorities are subject to a strict confidentiality regime. In circumstances where individuals are interrogated by the Competition Commission as part of the investigation, nothing they say may be used against them in criminal proceedings. Accordingly the practical implementation of the criminal provisions and the scope of cooperation between the National Prosecuting Authority and the competition authorities will need to be carefully determined.

At the time that the amendments were signed, concerns were raised about whether the criminal provisions are in line with the South African Constitution, and particularly whether they uphold an accused's right to be considered innocent until proven guilty. However, those parts of the amendments which caused the greatest concern have not been brought into effect (including those which state that a finding of the Tribunal of cartel conduct or a consent order constitutes proof for the purposes of the criminal prosecution that the company engaged in cartel conduct). The amendments preventing companies from paying fines or legal fees of their Directors and employees criminally charged also have not been brought into effect. However, the constitutionality of the criminal provisions may still be raised as a defence by anyone charged under the new law.

The criminal provisions will not have retrospective effect. It remains to be tested whether a cartel initiated before 1 May 2016 but with ongoing effects after that date could land its participants in jail. Anyone engaging in cartel conduct should desist immediately.

The Competition Act applies to any conduct having an economic effect in South Africa, which means that even if collusive arrangements are entered into offshore (if there is an effect in South Africa) foreign individuals who are present in South Africa could also face criminal prosecution.

What should companies and their directors do to protect themselves against these increased risks? Recommendations include:

  • Take advice on any conduct that may be cartel activity and stop any conduct that is.
  • The implementation of a suitable competition law compliance programme.
  • Development of robust monitoring and reporting procedures so as to establish an early warning system for leniency applications.
  • A regular internal review of all agreements and practices of your business, particularly in the context of industry associations where staff interact with competitors.
  • Take advice on any submissions to be made to the Competition Authorities, even in the context of a merger investigation.
  • Roll-out of training providing guidance to any South African operations on how to react in the event of a dawn raid - search and seizure proceedings are increasingly a favourite weapon in the Competition Commission's arsenal.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.