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[2020] ZACAC 9
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Competition Commission v Shoprite Checkers [Pty] Ltd and Another (183/CAC/Apr20 CT; CR228DEC18/DSM258FEB19) [2020] ZACAC 9 (27 October 2020)
REPUBLIC
OF SOUTH AFRICA
IN
THE COMPETITION APPEAL COURT OF SOUTH AFRICA
CAC
Case No.: 183/CAC/Apr20 CT
Case
No: CR228DEC18/DSM258FEB19
In
the matter between:
Competition
Commission Appellant
and
Shoprite
Checkers [Pty ] Ltd First
Respondent
Computicket
[Pty ] Ltd Second
Respondent
JUDGMENT
Vally
JA
Introduction
[1]
On 18 December 2018 the appellant [Commission] referred a
complaint to the Tribunal contending that
the first and second
respondents, Shoprite Checkers [Pty ] Ltd [Shoprite ] and
Computicket [Pty] Ltd [Computicket
] respectively
contravened s 8 [d ] [1 ] [i ] alternatively s 8 [c ] of the
Competition Act 89 of 1998 [the Act ].
[2]
Shoprite took the view that the complaint against it was legally
unsustainable. It took an exception with
the Tribunal. In legal
parlance this is known as a no cause of action exception.
Computicket, too, took an exception. It complained
that the referral
of the Commission was vague and embarrassing. This, again in legal
jargon, is known as a vague and embarrassing
exception. The
Commission duly responded, by affidavit, to the exceptions. It denied
that it had failed to disclose a cause of
action against Shoprite, or
that its referral contained vague, unclear or even contradictory
averments such that they would cause
any pleader to be embarrassed.
Shoprite also asked that the case against itself be dismissed.
[3]
The Tribunal entertained the exceptions. After giving them careful
consideration it upheld both Shoprite's
and Computicket's exceptions.
It ordered the Commission - it used the word 'must' - to file a
supplementary affidavit attending
to the criticisms of its case as
articulated in the referral affidavit by Shoprite and Computicket.
The Order is made up of two
parts: one focussed on Shoprite's
criticisms and the other on those of Computicket. By ordering the
Commission to amend its referral,
it refused Shoprite's claim to have
the case against it dismissed. The Commission is aggrieved at the
conclusion regarding Shoprite's
objection, as well as the injunction
that it 'must' file a supplementary affidavit to overcome the
objection. The Commission has
no difficulty with the Tribunal's
findings with regard to Computicket's objection. Thus, it seeks that
only the part of the Order
focussing on the Shoprite case be set
aside. Shoprite, too, is aggrieved at the Tribunal's failure to
dismiss the Commission's
case against it. However, it recognises that
the Commission has not closed the door to it altogether.
[4]
The first question raised by the Commission's attempt to appeal the
Order is whether it is appealable. Shoprite
submits that it is not,
but if this court holds that it is, then it cross-appeals against the
Tribunal's failure to dismiss the
Commission's case against it.
[5]
Before examining the case of the Commission it is necessary to record
that there is an ancillary application
by the Commission for
condonation for late filing of record, and for the reinstatement of
the appeal. Should we refuse the application
that would be the end of
the matter. Shoprite and Computicket take the view that condonation
should be refused because, they claim,
the Commission's case is weak
on the merits. However, they agree that the issue of condonation
cannot be separated from the merits
of the case, and that if we were
to find that the Commission has a good case on the merits then the
application for condonation
should be granted and vice versa - if it
has a bad case on the merits then the application should be refused.
The
Commission's case as articulated in the referral
[6]
The spine of the Commission's case is constituted by seven
interconnected paragraphs in the referral affidavit.
They are lengthy
but, given their importance to the determination of the exception,
deserving of repetition here. They read:
'Computicket
12.
Computicket distributes tickets for entertainment events. Bus travel,
flights, hotel accommodation and holiday packages.
It does so mainly
through the "Money Market" kiosks in certain of Shoprite
Checkers' branded supermarkets or stores,
namely Shoprite, Checkers,
Checkers Hyper and certain USave and House and Home stores.
Computicket also operates several stand-alone
kiosks, an electronic
distribution system through email and cellular networks, a call
centre and a website.
13.
Computicket has two types of customers, namely inventory providers
[that enter into the exclusive agreements
detailed below] and
end-consumers who purchase tickets from Computicket.
Shoprite
Checkers
14.
The primary business of Shoprite Checkers is the retailing of food,
liquor, household products, furniture and pharmaceuticals
to
consumers of all income levels. It does this through the following
brands: Shoprite, Checkers, Checkers Hyper, USave, OK Furniture,
MediRite, House and Home, Shoprite LiquorShop and Checkers
LiquorShop.
CONDUCT
APPLIES TO BOTH RESPONDENTS
15.
For purposes of the Computicket referral, with regard to the conduct
described in detail below, Computicket and
Shoprite Checkers are
liable for the contravention of section 8 [d ] [i ], alternatively 8
[c ], of the Act because:
15.1
Both Computicket and Shoprite Checkers were involved in the impugned
conduct; alternatively
15.2
Shoprite Checkers exercised decisive influence over the decisions of
Computicket during the relevant period, whereas
Computicket did not
decide its own market conduct independently, but rather operated in
accordance with the will of Shoprite Checkers,
its parent company.
16.
Shoprite Checkers was involved in the impugned conduct, alternatively
exercised decisive influence over the market
conduct of Computicket,
because, inter a/ia:
16.1
Shoprite Checkers acquired Computicket in 2005 and implemented a
strategy in terms of which Computicket would be fully
integrated into
the value chain of Shoprite Checkers;
16.2
Mr Gerhard Hayes ["Mr Hayes" ], the general manager
of Shoprite Checkers' Value Added Services Division
at the relevant
time, was tasked with implementing Shoprite Checkers' strategy in
relation to Computicket and to this effect was
also, in addition to
his position at Shoprite Checkers, appointed as Chief Executive
Officer of Computicket in 2007. He was appointed
to the Shoprite
Checkers board of directors in 2009;
16.3
The business of Computicket is fully integrated into the supply chain
of Shoprite Checkers through inter a/ia the physical
presence of
Computicket's distribution network in the retail stores of Shoprite
Checkers;
16.4
Shoprite Checkers played a key role in requiring that Computicket
must contain the offending exclusivity clauses in its
agreements with
inventory providers and that the duration of the agreements should be
a period of three years;
16.5
Shoprite Checkers was central to enforcing Computicket's exclusive
agreements in the event that inventory providers did
not adhere to
the exclusivity requirements;
16.6
Decision making in relation to negotiations with inventory providers
was shared between Computicket and Shoprite Checkers;
16.7
Shoprite Checkers was aware, endorsed and encouraged the conduct,
described in detail below, which gave rise to the contravention
of
the Act;
16.8
The Shoprite strategy implemented by Mr Hayes in respect of
Computicket remained in place even after it left Computicket;
and,
16.9
There are further significant structural links between Shoprite
Checkers and Computicket. As indicated Computicket is
a 100% wholly
owned subsidiary of the Shoprite Checkers and Shoprite Checkers is a
wholly owned subsidiary of Shoprite Holdings.
The same two
individuals, Jacob Sasson and Marius Sasson, are the members of the
Board of Directors of Computicket and Shoprite
Holdings at the
relevant time. Mr Bosman was also a director of Shoprite Checkers at
the relevant time. Mr Peter Christian Engelbrecht
and Mr Carel Genis
Goosen were directors of Computicket, Shoprite Checkers and Shoprite
Holdings during the relevant period.
17.
As such, the conduct which gives rise to the contraventions detailed
herein implicates both Computicket and Shoprite
Checkers. For the
sake of clarity, it is Computicket which is alleged to be dominant in
the relevant market and not Shoprite Checkers.
It is nevertheless
submitted that Shoprite Checkers is also liable for the contravention
of section 8 [d ] [i ], alternatively
8 [c ] of the Act for, inter
a/ia, the reasons indicated above.
18.
Where I thus make reference to Computicket in describing the conduct,
it should be read to refer to both of the
Respondents, unless the
context demands otherwise.'
[7]
The Commission maintains that the contents of these paragraphs
demonstrate that it is relying on the doctrine
of a Single Economic
Activity [SEE] with the SEE being the dominant firm. There is,
however, no direct reference to an SEE
or to a dominant firm in the
referral. It contends that the doctrine is a conclusion of law, which
can be reached on the pleaded
facts. Its case is that the contents of
sub-paragraph 15.2, as well as other sub paragraphs in the
referral affidavit where
the same or a similar allegation of fact is
made, demonstrate that it is relying on the doctrine. This, it says,
is indubitably
clear to anyone who reads the pleaded facts: they
clearly demonstrate that the two entities are so intertwined as to be
indistinguishable
when pursuing and carrying out the impugned
conduct. This SEE [Computicket and Shoprite combined for
purposes of the impugned
conduct] constitute a 'firm' as defined in
the Act, and understood in the common law arising from judgments of
this court.
Paragraphs
in the body of the decision and the Order
[8]
After hearing the parties the Tribunal issued its 'Reasons for
Decision' [Decision ]. There are two
paragraphs in body of the
Decision that caused great consternation to the Commission. They lie
at the core of the Commission's
appeal. They are to be found at [28]
and [36] of the Decision. They read, respectively:
'[28]
In all the cases cited above, the firms were accused of horizontal
restrictive practises in terms of section 4. In the matter
before us,
the 2018 referral concerns a section 8 contravention. We must ask the
question whether it would be appropriate to apply
the doctrine,
normally relied on and applied in horizontal restrictive practice
cases, to an abuse of dominance case? In our view,
no. The reading of
section 4 [5 ] clearly applies to agreements or concerted practices
in the context and framework of section
4 [1], as subsection 4 [5]
reads "the provisions of subsection [1] do not apply to an
agreement between, or concerted
practice ..." If the application
were intended for section 8, the legislature would have indicated
such an intention clearly,
by inserting a similar provision to
section 4 [5 ] under section 8.
[36]
In our view, in light of the law outlined above, that Computicket and
Shoprite Checkers are separate economic entities and
should therefore
be treated as such in respect of the allegations contained in the
Commission's complaint.' [Underlining
added. ]
[9]
While the Commission only drew attention to [28] and [36], the next
paragraph,
[37],
is equally important. Here the Tribunal deals with [i] whether
Shoprite [not Shoprite and Computicket together]
is a dominant
firm; and [ii] why it found the Commission's referral to the
problematic. The relevant part of the paragraph
reads:
'[37]
With regards to the issue of dominance, the Commission conceded that
Shoprite Checkers is not active in the market for outsourced
ticketing services to inventory providers in which Computicket is
active. Unsurprisingly, no market shares attributable to Shoprite
Checkers are reflected anywhere in the Commission's referral. It
simply is unclear what we are to make of the allegations against
Shoprite Checkers.'
[10]
In the rest of the paragraph the Tribunal makes very clear what it
found and what it expects of the Commission:
'Given
that the Commission's reliance on the single economic entity doctrine
fails and the question of dominance is abundantly opaque,
the
Commission must rectify the referral to properly reflect and clarify
the case against Shoprite Checkers in order for it to
meet the case
put against it.'
[11]
In this, the second part of the paragraph, the Tribunal leaves no
doubt as to what it found: the pleaded facts failed
to establish that
Computicket and Shoprite constituted an SEE. And, the issue of a
dominant firm is assessed solely with regard
to Shoprite and not with
regard to the combined role, effort or conduct of Computicket and
Shoprite. It took no note of the allegations
in paragraphs 15 and 16
of the referral affidavit quoted in [6] above - which must be
accepted as proven - that the two were incestuously
connected for
purposes of carrying out the impugned conduct. The cause for this
lies in paragraph 17 of the referral affidavit.
Here the Commission
confounded its own case. In this paragraph the Commission focussed on
the separate roles of Computicket and
Shoprite and specified that 'it
is Computicket which is alleged to be dominant in the relevant market
and not Shoprite Checkers.'
With this averment it appears to disown
its case that they constituted an SEE, which was a dominant firm. In
the circumstances,
it is no surprise that the Tribunal dealt with its
case in the manner that it did. The Commission did itself no favours
by pursuing
a case that the two entities combined constitute a
dominant firm and then unnecessarily making reference to the separate
position
of each, particularly Shoprite. This served to sow confusion
about its case, which confusion infected the decision. In my view the
Commission should have spelt out [i] what it means by an SEE,
[ii] why Computicket and Shoprite constitute an SEE and
[iii]
why and how the SEE is a dominant firm.
[12]
It is clear from the findings - I used the word advisedly - that the
concept of a legal entity loomed large in the Tribunal's
consideration. It is on the basis of that concept that it came to
find that there was no SEE. The concept of a legal entity was
conflated with the economic doctrine SEE. Therein lies the substance
to the Commission's complaint against [28] and [36] of the
Decision.
[13]
The Order, it will be recalled, required the Commission to file a
supplementary affidavit attending to the complaint
of Shoprite. It
did not, as asked for by Shoprite, dismiss the claim against
Shoprite. The full terms of the Order with regard
to Shoprite reads:
'[1]
The Shoprite Checkers [Pty ] Ltd dismissal application and
exception application are upheld in the following respects:
[1.1]
Within thirty [30 ] business days of this order, the Commission
must file a supplementary referral affidavit to the
Complaint
Referral to cure the defects in the Complaint Referral in respect of
the allegations against Shoprite Checkers [Pty
] Ltd by
complying with the provisions of Tribunal Rule 15 [2 ], failing which
the applicants in this matter are given leave to
approach the
Tribunal for an order that the Complaint Referral in so far as it
relates to Shoprite Checkers [Pty ] Ltd be
dismissed.'
[14]
There is no link between the first sentence and the rest of the
Order. At the end of the first sentence, the parties
would be
expecting to learn in what respects Shoprite's 'dismissal application
and exception application' are upheld. Instead they
are told that
'the Commission must file a supplementary referral affidavit to the
Complaint Referral to cure the defects in the
Complaint Referral in
respect of the allegations of' Shoprite.' This part of the Order
cannot be separated from [28], [36] and
[37] of the Decision. Put
differently, if [28], [36] and [37] were amputated from the Decision
this part of the Order would not
only lack foundation but would
actually make no sense, argues the Commission.
Is
the Order appealable?
[15]
Section 37 [1 ] [b ] read with section 61 [1 ] of the Act empowers
this court to entertain any appeal against any decision
of the
Tribunal that is 'final', save for an 'order' that is made with the
consent of the parties.
[1]
It is
instructive to note that the Act uses the terms 'decision' and
'order' in the same sentence: a 'decision' and an 'order'
is really a
distinction without a difference.
[2]
The decision or the order must be final though to be appealable.
[16]
The section also allows for an appeal against an 'interim or its
interlocutory decision' of the Tribunal 'that may, in
terms of [the]
Act, be taken on appeal.'
[3]
The
present Decision is not one of those that may in terms of the Act be
taken on appeal. The Order is also not one that was made
by consent
of the parties. This leaves the issue of whether the Decision of the
Tribunal is a 'final' one.
[17]
The Appellate Division [now Supreme Court of Appeal [SCA
] ] in Zweni
[4]
dealing with
section 20 of the Supreme Court Act 59 of 1959, gave guidance as to
what a decision or order should state in order
to be final. But first
it is important to record that even in Zweni the court recognised
that a decision can be a judgment or order.
It said:
'The
issue whether a decision is an appealable 'judgment or order' is
complicated by a number of factors.'
[5]
And
that the distinction between 'judgment' and 'order':
'...
is formalistic and outdated; it performs no function and ought to be
discarded.'
[6]
[18]
In Zweni the court held that a 'judgment or order' is:
'a
decision which, as a general principle, has three attributes, first
the decision must be final and in effect and not susceptible
of
alteration by the Court of first instance; second, it must be
definitive of the rights of the parties; and, third, it must have
the
effect of disposing of at least a substantial portion of the relief
claimed in the main proceedings.'
[7]
The three attributes certainly provide a useful guide and should
always be the starting point in any analysis focussed on the issue
of
appealabilty. It is neither exhaustive nor 'cast in stone.'
[8]
[19]
In Telkom
[9]
and in Loungefoam
[1 ]
[10]
this court has
adopted the jurisprudence of the SCA as set out in Zweni. More
recently, this court in Vexa
[11]
stated:
"[12]
These matters define a somewhat narrow debate, framed largely by the
position articulated in Zweni. An altogether wider
view is to be
found in Scaw
[12]
, and the
principles there articulated by the Constitutional Court. In Scaw,
the question was how to interpret s167 [6 ] [b ] of
the Constitution
which permits of an appeal directly to the Constitutional Court, when
it is in the interests of justice. The Constitutional
Court reviewed
the jurisprudence of the Supreme Court of Appeal and considered that
the appealability of a "judgment or order"
should not be
confined to the Zweni principles, but should extend to the broader
concept of what the interests of justice require.
What the interests
of justice require will depend upon the particular case. Scaw
emphasizes that irreparable harm occasioned by
the interim order, if
leave to appeal is not granted, is an important consideration in
determining the interests of justice. This
marks a departure from the
more parsimonious position of some of the appellate jurisprudence
that does not count the prejudice
caused by an interim order to be
availing in deciding whether the order is appealable.
[13]
[20]
Mr Ngukaitobi SC for the Commission submitted that the ratio in
Vexall represents a shifting of the dial by drawing
on the
innovation of the Constitutional Court, which places the concept
'interests of justice' at the centre of the enquiry on
appealabilty
of an order or decision. He invited us to hold that an appeal should
not only be entertained in cases where a final
order or decision has
been made, but also in cases where an interlocutory decision or order
is issued, if the 'interests of justice'
so requires. Since the terms
of the order was not 'final' he submitted that it would, in the light
of [28] and [36] of the Decision,
be in the interests of justice to
entertain and uphold the appeal. The interests of justice test has
been described as the 'equitable
and more context-sensitive
standard'.
[14]
Both the Zweni
and the interests of justice tests are fact-specific. The interests
of justice test has not made the requirement
of the attributes
referred to in Zweni redundant. The differences between the two tests
should not be exaggerated. The interests
of justice test merely makes
allowance for a situation where one or more of the attributes
referred to in Zweni may be absent,
or if there are other attributes
that stand out such as on going harm to the appellant caused by
the interim order. The interests
of justice test has certainly not
opened the sluice-gate allowing for all interim orders to flow freely
to the appeal court. That
said, based on the conclusion I arrive at
in this case, there is no need to have recourse to the interests of
justice test.
[21]
The Commission submitted that [28] and [36] of the Tribunal's
Decision constitute definitive final decisions, which cannot
be
reversed by the Tribunal.
[22]
Mr Trengove SC, for Shoprite, relying on the phrase 'in our view' in
both paragraphs, stressed that they are mere opinions
or reasons for
the Order and therefore fall outside the scope of an appeal.
Incorrect opinions and reasons do not provide for an
appeal. Building
on the argument, he emphasised that the terms of the Order are
patent. The Commission is allowed to amend its
referral, should it be
advised or wished to do so. It could elect to stand by the referral
in its present form and request the
Tribunal to deal with the matter
once again. In that case the referral 'remains unaltered and the
relief asked' therein 'remains
for adjudication.'
[15]
If this time the Tribunal dismisses the case of the Commission, it
can appeal to this court. Until that occurs the road to an appeal
remains closed. The focus in this argument is on the Order - the
contents of [28] and [36] of the Decision having been dismissed
as
'mere opinions' or 'reasons'.
[23]
It is correct and in fact uncontroversial that the Commission's
complaint can only be directed at a final order or decision,
and not
at the reasons for the order or decision,
[16]
for this court to entertain it. But, the controversy in this case
revolves around the question: what is the Order or the Decision?
We
know that - in terms of [28], [36] and [37] of the Decision - the
exception is upheld and that - in terms of the Order - the
Commission
is afforded an opportunity to amend its case.
[24]
It is common to find phrases such as: 'in my view'; 'in my judgment';
'I hold' and 'I conclude' in decisions of tribunals
and judgments of
a court. The phrase is often followed up with a definitive statement.
They are often found after the author has
engaged with the facts, the
submissions of the parties and the law. In some cases the phrase and
accompanying statement come even
before the tribunal or court has
engaged with the facts, submissions of the parties and the law. In
either event, the statement
following the phrase could constitute the
final decision.
[25]
There is little doubt that the effect of the Order viewed
independently of [28 ], [36 ] and second sentence of [37] of
the
Decision is such that the case of the Commission has neither been
dismissed nor upheld. There has been no 'definitive and distinct
relief'17 granted to the Commission or Shoprite and no final
pronouncement of the rights of either of these parties. However,
[28], [36] read with the second sentence of [37] of the Tribunal's
Decision all have the attributes of a final decision or order.
They
are not open to reversal by the Tribunal. Thus, while the Commission
is afforded an opportunity to amend the referral, it
cannot any
longer present a case that Computicket and Shoprite constitute an
SEE, which is a dominant firm. Its case that this
SEE has contravened
sections 8 [1 ] [d ] [i ] or [c ] of the Act by concluding agreements
with its customers, precluding them from
dealing with its competitors
is, as far as the Tribunal is concerned, doomed to failure. Its case,
however recrafted, which re-iterates
the same facts and calls on the
Tribunal to draw the same conclusion, by dint of the findings in [28]
and [36], has effectively
been
[17]
dismissed. The contents of [28] and [36] read with [37] are
unambiguously clear. In [28] the Tribunal definitively finds that the
concept of an SEE is restricted to 'horizontal restrictive practises
in terms of section 4' and is not applicable to 'an abuse
of
dominance case' reference in section 8 of the Act. In [36] the
Tribunal rejects the contention of the Commission that Computicket
and Shoprite constitute an SEE. Instead it finds that Computicket and
Shoprite 'are separate economic entities and should therefore
be
treated as such in respect of the allegations contained in the
Commission's complaint.' These are unequivocal findings against
the
Commission.
[26]
Given the firm and uncompromising language used in [28], [36] and
[37] they are, I conclude, definitive final findings.
The Commission
is not able to alter them. They are, therefore appealable. There is
another reason why they are appealable. The
Commission is not able to
make out the case it intends to without repeating the very averments
that have been rejected by the Tribunal.
The opportunity being
afforded to the Commission to amend its case is illusory. The dictum
of Zondi JA is in point here:
'However,
when an exception is upheld on the ground that the particulars of
claim does not disclose a cause of action and the plaintiff
is
granted leave to amend, whether or not the order is final would
depend on whether it is capable of being amended.'
[18]
[27]
The findings in [28] and [36] were not carried over into the Order.
Once it was found that it was not possible to rely
on the doctrine of
SEE to hold Shoprite accountable for the alleged unlawful conduct,
the Commission's case as against Shoprite
was effectively dismissed.
That this finding was not carried into the Order does not detract
from the finality of the effect of
the findings.
Should
the appeal succeed?
[28]
The case of the Commission is that while the doctrine of an SEE is
only explicitly recognised in section 4 [5] of the
Act, it could and
should apply with equal force in an abuse of dominance case under
section 8 of the Act. It calls for the common
law to be developed to
allow for this. With resounding scholarly precision it makes copious
reference to the jurisprudence of the
European Court of Justice to
support its case. The pleaded facts certainly allow for such a case
to be made. Whether the case is
compelling is not for us to say at
this stage.
[29]
The finding of the Tribunal that no SEE and no section 8
contravention could be established on the pleaded facts is wrong.
The
pleaded facts [given that the Tribunal had no difficulty with
there being no reference to an SEE or firm] certainly allow
for the
Commission to pursue the case for the development of our law based on
the learnings from international jurisprudence, especially
that of
the European Union [EU]. Once the Tribunal saw no difficulty
with the Commission's failure to make reference to an
SEE and to the
combined entity as a dominant firm it would have had to [i]
find that the pleaded facts discloses a cause
of action, [ii]
dismiss Shoprite's exception, and [iii] order Shoprite to plead
to the referral. The determination
as to whether Computicket and
Shoprite could be held liable for a section 8 contravention would
only be made after a full hearing
was held before the Tribunal, and
the facts and the complex legal issues maturely and thoughtfully
considered. Accordingly, the
findings in [28] and [36] constitute a
misdirection which can only be remedied by being set aside. Recalling
that these findings
were not carried over into the Order, it is
necessary to consider whether the Order itself should be set aside
once they are amputated
from the Decision. In my judgment, not so.
The Commission must clearly and unambiguously plead that it relies on
the doctrine of
SEE, that the SEE constitutes a firm as defined in
the Act and the common law, and that it is dominant in the relevant
market.
By so doing the Commission would, as it must, attend to the
ambiguity in paragraph 17 - identified and discussed in [11] above -
of its referral affidavit. Allowing the Order to stand would enable
the Commission to attend to these issues. Thus, I reject the
Commission's submission that amputating [28], [36] and [37] of the
Decision would ineluctably lead to the conclusion that the Order
must
be set aside.
The
conditional cross-appeal
[30]
Shoprite's exception is based on the averment in the referral
affidavit which concedes that it is not a dominant firm
in the
relevant market. In fact, it is accepted in the referral affidavit
that Shoprite does not even operate in the relevant market.
Understandably so, there is no allegation that it required its own
customers to deal with its own competitors. The case against
it is
that it was an accessory to the dominant firm's - Computicket's -
contravention. Section 8 of the Act does not allow for
accessory
liability. The case against it, therefore, has to be dismissed.
Shoprite further contended that the SEE doctrine is only
applicable
to a section 4 contravention and not a section 8 one. The
Commission's attempt to invoke the doctrine solely for purposes
of
holding it liable for its subsidiary's [Computicket ]
contravention is bad in law. These were the very contentions it
made
before the Tribunal. They were upheld, but the Order it sought - a
dismissal of the claim as against it - was not granted.
It asks that
we uphold the cross-appeal and dismiss the claim against it.
[31]
For the reasons set out in [29 ] and [30 ] above, I find that there
is no merit in the cross-appeal. Accordingly, it
fails.
[32]
In the result the following Order is made
a.
The delay in filing the record of the appeal is condoned and the
appeal
is reinstated.
b.
The appeal is upheld in the following respects:
i.
The findings in [28 ], [36 ] and [37] of the Reasons for the Decision
of the Tribunal are set aside.
c.
The appeal as regards Order [1] is dismissed.
d.
The conditional cross-appeal is dismissed.
e.
Each party is to pay its own costs.
VallyJ
Judge:
Competition Appeal Court
I
concur
Mnguni
Judge:
Competition Appeal Court
Date
of hearing: 11
September 2020
Date
of judgment: 27
October 2020
For
the Appellant: T
Ngukaitobi SC
Instructed
by: Competition
Commission
For
the Respondent: W Trengove SC
with M Engelbrecht SC and K Premhid
Instructed
by: Werksmans
Attorneys
[1]
Section 37 [1 ] [b ] [i ]
[2]
Heyman v Yorkshire Insurance Co Ltd 1964 [1 ] SA 487 [A
] at 492C-493B; Law Society, Transvaal v Behrman 1981 [4
] SA
538 [A ] at 546O-F; Firstrand Bank Limited tla First National
Bank v Makaleng
[2016] ZASCA 169
[24 November 2016 ] at [10]-
[15]
[3]
Section 37 [1 ] [b ] [ii ]
[4]
Zweni v Minister of Law and Order 1993 [1 ] SA 523 [A ]
[5]
Idat531E
[6]
Id at 532E
[7]
Id at 532I-533A
[8]
Moch v Nedtravel [Ply ] Ltd tla American Express Travel
Service 1996 [3 ] SA 1 [A} at 10F-G
[9]
Telkom SA v Orion Cellular and Others [2005] 1 CIPLR 113 [CAC
]
[10]
Loungefoam v Competition Commission [2011] ZACZC 4 [6
May 2011 ] at [20]
[11]
Business Connexion v Vexall
[2020] ZACAC 4
[15 July 2020
]
[12]
International Trade Administration Commission v Scaw South Africa
[Pty ] Ltd & Others 2012 [4 ] SA 618 [CC ]
See also
National Treasury and others v Opposition to Urban Tolling Alliance
and others 2012 [6 ]SA223 [CC ] at para 25
[13]
Cronshaw & another v Fidelity Guards Holdings [Pty ] Ltd
1996 [3 ] SA 686 [A ]
[14]
Philani-Ma-Afrika v Mal1u/a & others 2010 [2 ] SA 573
[SCA ] at [20]
[15]
Nxaba v Nxaba
1926 AD 392
at 394
[16]
Neotel [Pty ] Ltd v Telkom SA Soc Ltd and Others [605/2016
]
[2017] ZASCA 47
[31 March 2017 ] at [13]
[17]
Dickinson and Another v Fisher's Executors
1914 AD 424
and 427
[18]
Tshiaeneo Sybil Ramatsimbila v Dr Nkhelebeni Phaswana [2014 ] ZASCA
117 [19 September 2014 ] at Para 4.