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[2013] ZACT 75
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Competition Commission v Murray & Roberts Ltd (017277) [2013] ZACT 75 (22 July 2013)

COMPETITION
TRIBUNAL
REPUBLIC
OF SOUTH AFRICA
Case
No: 017277
In
the matter between:
The
Competition Commission Applicant
and
Murray
& Roberts Limited Respondent
Panel: N
Manoim (Presiding Member), Y Carrim (Tribunal Member) and T Madima
(Tribunal Member)
Heard
on: 18 July 2013
Decided
on: 22 July 2013
Order
The
Tribunal hereby confirms the order as agreed to and proposed by the
Competition Commission and the respondent, annexed hereto
marked “A”.
-
Presiding
Member
N
Manoim
Concurring:
Y Carrim and T Madima
IN THE
COMPETITION TRIBUNAL OF
SOUTH
AFRICA
HELD IN
PRETORIA
CT
Case
No:
CC Case
No:2009Feb4279/2009Sep4641
Application
for
confirmation
of
a
consent agreement
In
the matter between:
THE
COMPETITION COMMISSION
Applicant
and
MURRAY
& ROBERTS
LIMITED
Respondent
CONSENT
AGREEMENT IN
TERMS
OF
SECTION
49D
READ
WITH SECTION 58(1)(a)(iii)
AS
READ
WITH
SECTION 58(1){b) OF THE
COMPETITION
ACT, 1998
(ACT
NO. 89 OF 1998)S
AS
AMENDED,
BETWEEN
THE COMPETITION COMMISSION AND MURRAY
&
ROBERTS'
LIMITED,
IN
REGARD
TO
CONTRAVENTIONS
OF SECTION 4(1}(b)(iii) OF THE
COMPETITION
ACT,
1998
PREAMBLE
WHEREAS
the
Competition
Commission is empowered to,
inter
alia,
investigate
alleged
contraventions
of
the
Competition
Act,
1998
;
WHEREAS
the
Competition
Commission is empowered to,
inter
alia,
conclude consent agreements in terms of
section 49D
of the
Competition
Act,
1998
;
WHEREAS
the Competition Commission has invited firms in the construction
industry to
engage
in settlement
of
contraventions
of the
Competition Act,
1998
;
WHEAREAS
Murray & Roberts
Limited
(“Murray
& Roberts”) has accepted the
invitation
and
has
agreed to settle in accordance with the terms of the Invitation;
NOW
THEREFORE the
Competition
Commission
and
Murray
&
Roberts hereby
agree
that
application be made to the Competition Tribunal for
the
confirmation
of this consent agreement as an order of the Competition
Tribunal
in
terms of
section 49D
as read with
section
58(1)(a)(iii)
and
section
58(1Xb)
of the
Competition Act, 1998
.
1.
Definitions
For
the purposes of this consent agreement, unless the context indicates
otherwise,
the following definitions shall apply:
1.1.
“Act”
means
the Competition Act, 1998 (Act No. 89 of 1998), as amended;
1.2.
“CFTP” means the Construction Fast Track Process
announced
by
the Commission on 1 February 2011 to
fast
track
the settlement process and to resolve the Commission’s
investigations
Into
the
construction industry;
1.3.
“CIDB
Regulations”
refers to the
Construction
Industry
Development
Regulations,
2004
(as amended) (Government Notice No.692 of 9 June 2004, published in
Government
Gazette
No.25427
of 9 June 2004);
1.4.
“CLP"
means
the Commission’s Corporate
Leniency
Policy
(Government Notice No.
628
of
23 May 2008, published in Government Gazette No. 31
064
of
23 May
2008);
1.5.
“Commission”
means
the
Competition Commission of South Africa, a statutory
body
established
in
terms
of section 19 of the Act, with its principal place of business at 1st
Floor, Mulayo Building (Block C), the dti Campus, 77
Meintjies
Street, Sunnyside, Pretoria, Gauteng;
1.6.
“Commissioner”
means
the Commissioner
of
the
Competition
Commissi
on,
appointed in terms of section 22 of the Act;
1.7.
“Complaints’’
means
the
complaints
initiated
by the
Commissioner
of
the
Competition Commission in terms of section
49B
of
the
Act
under case numbers
2009Feb4279
and
2009Sep4641;
1.8.
Consent Agreement”
means
this
agreement
duly
signed
and
concluded between the Commission and Murray and Roberts Limited;
1.9.
“Cover Price”
means
generally,
a price that is provided by a
firm
that
wishes to win a tender to
a
firm
that does not
wish
to
do
so,
in
order
that the firm that does not
wish
to
win the tender may submit a higher price;
or
a
price
that is provided by a
firm
that
does not wish to win a tender
to
a
firm that does wish to win that tender in
order
that
the firm that wishes to
win
the
tender may
submit
a
lower
price,
1.10.
“Invitation"
means
the
Invitation
to
Firms in the
Construction
Industry
to
engage
in
Settlement of
Contraventions
of
the
Competition Act, as
published on
the
website
of
the
Commission
on
1
February
2011;
1.11.
“Murray
&
Roberts" means a
company
incorporated
under the laws of the Republic of South
Africa
with
its
principal
place of business at Douglas Roberts
Centre,
22
Skeen Boulevard, Bedford view.
1.12.
“Non-prescribed prohibited practices” refers to
prohibited restrictive horizontal practices relating to the
construction
industry
that are contemplated in section
4(1
)(b)
of
the Act and that are on-going or had
not
ceased
three years before the complaints were initiated, as contemplated in
section
67
of the
Act;
1.13.
"Parties”
means
the Commission and
Murray
and
Roberts Limited (Murray & Roberts);
1.14.
"Prescribed prohibited practices” refers to prohibited
restrictive horizontal practices relating to the construction

industry that are contemplated
in
section
4(1 )(b) of the Act and that ceased after 30 November 1998, but more
than
three
years
before the
complaints
were initiated
1.15.
“Respondent” means Murray &
Roberts;
1.16
“Settlement”
refers
to settlement in terms of the Invitation to Firms in
the
Construction
Industry
to
Engage
in
Settlement
of
Contraventions of
the
Act and the procedures detailed therein.
1.17.
“Subsector" refers to
the
classes
of construction
work
defined
in Schedule 3 of
the
CIDB
Regulations, substituted by Government Notice
No.
8986
of 14 November 2008,
published
in
Government Gazette
No.
31603
of
14
November
2003;
1.18.
“Tribunal"
means
the
Competition
Tribunal of South Africa, a statutory body established in terms of
section 26 of the Act, with its
principal
place
of business at
3rd
Floor,
Mulayo
building (Block
C),
the dti Campus,
77
Meintjies
Street
Sunnyside, Pretoria, Gauteng.
2.
The Complaints
2.1.
On 10 February 2009 the Commission
initiated
a
complaint in terms of section 49B(1) of the Act Into alleged
prohibited practices relating to collusive conduct in the
construction
of
the
stadiums
for
the 2010 FIFA Soccer World Cup
against
Grlnaker-LTA
(the construction operating business unit of Aveng), Group Five
Limited, Basil Read (Pty)
Ltd,
WBHO
Construction (Pty) Ltd, Murray & Roberts Limited, Stefanutti
Stocks Limited, Interbeton Abu Dhabi nv ilc and Bouygues Construction
SA.
■
2.2.
In addition, on
01
September
2009, following the receipt of applications for immunity in terms of
the CLP, the Commission initiated a Complaint in
terms of section
49B(1) of the Act
into
particular
prohibited practices
relating
to
conduct
in construction projects, by the firms listed below. The Complaint
concerned alleged contraventions of
section
4(1 )(b) of
the
Act as regards
price
fixing,
market
allocation
and
collusive tendering. The investigation was
initiated
against
the following
firms:
Grinaker
LTA
Ltd,
Aveng
(Africa) Ltd, Stefanutti Stocks Holdings Ltd,
Group
Five
Lt
d
,
M
ur
ray
&
R
oberts
,
C
o
nc
o
r
Ltd.
G.
Liviera
& Son
Building
(Pty) Ltd, Giunictch Coastal Projects (Pty) Ltd, Hochtief
Construction
AG, Dura Soletanche-Bachy (Pty) Ltd, Nishimatsu Construction Co Ltd,
Esorfranki Ltd, VNA Pilings CC,
Rodio
Geotechmcs
(Pty)
Ltd, Diabor Ltd, Gauteng Piling (Pty) Ltd, Fairbrother Geotechnical
CC, Geomechanics CC, Wilson Bayly
Holmes-Ovcon
Ltd
and
other
construction
firms.
Including joint ventures.
3.
The Invitation to Firms in
the
Construction
Industry to Engage in Settlement
of
Contraventions
of the Act
3.1.
The
Commission’s
investigation
of the
Complaints,
as
well
as
several
other
of
the
Commission's investigations
in
the construction industry, led
the
Commission
to believe that
there
was
widespread collusion in contravention of section 4(1 )(b)(»0 of
the Act in the construction
industry.
3.2.
Section 4(1 )(b) provides-
a4.
Restrictive
horizontal
practices prohibited
(1)
An agreement between,
or
concerted
practice
bv< firms
.
or
a
decision
bv
an
association
of
firms, is prohibited if it is
between
parties
in a
horizontal
relationship
and
if-
(a)
it
has
the
effect of substantially preventing, or lessening, competition
in
a
market, unless a
party
to
the agreement, concerted practice,
or
decision
can prove that any
technological
r
efficiency or other
pro-
competitive gain resulting
from
it outweighs that effect; or
(b)
it involves
anv
of the following
restrictive
horizontal
practices:
(i)
directly or indirectly fixing a purchase or selling price or
any
other
trading condition;
(ii)
dividing
markets
by
allocating
customers,
suppliers, territories, or specific types of goods
or
services; or
(iii)
collusive
tendering
.
*
3.3.
The collusive conduct
engaged
in,
in the context of
the
Invitation
and
this Consent Agreement, was collusive tendering or “bid-rigging”.
Collusive
tendering involves particular conduct
by
firms
whereby as
competitors
they
collude
regarding a tender resulting
in
the
tender
process
being
distorted.
The
bid prices and the bid submissions by these competitors as well as
the
outcome
of
the tender process is not the result of competition on the merits.
“Cover pricing"
in
this
context occurs when conspiring firms agree that one or more of them
will
submit
a
bid that is
not
intended
to win
the
contract.
The
agreement
is reached in
such
a
way
that
among the
colluding
firms,
one
firm
wishes
to win the tender and the others agree to
submit
non-competitive
bids with prices
that
would be higher than the bid of the designated winner, or the price
wili
be too high to
be
accepted,
or
the
bid
contains
special
terms
that
are
known
to be
unacceptable
to the
client.
Collusive
tendering therefore applies to agreements
or
concerted
practices
which
have
as
their
object
or
effect
the
prevention,
lessening, restriction and
distortion
of
competition
in South Africa.
3.4.
In
terms
of section
2
of
the Act, two of the key objects of the Act
are
to
promote
the efficiency, adaptability and development of the economy, and to
provide
consumers
with
competitive prices
and
product
chorees. Section 217 of the
Constitution
of
the Republic of South
Africa,
1996
calls for a procurement
or
tender
system which is fair,
equitable,
transparent,
competitive and cost-effective.
3.5.
In addition, the Commission is required in terms of section
21(1)
of
the Act,
inter
alia,
to implement measures to increase market transparency,
to
investigate
and
evaluate
alleged contraventions of Chapter 2 of the Act, and to negotiate and
conclude consent agreements in terms of section 49D
for confirmation
as
an
order of the
Competition
Tribunal
in
terms
of section 58(1 Xb) of the Act
3.6.
Therefore, in
the
interest
of
transparency, efficiency, disrupting cartels and incentivising
competitive
behaviour
in the construction industry
and
a
cost-effective, comprehensive and speedy resolution
of
the
investigations referred to above, the Commission decided to fast
track these
investigations
and
their resolution
by
inviting
firms that were involved in
collusive
tendering
in the form of bid-rigging of projects in the construction
Industry,
to
apply to engage in
settlement
discussions
on the terms set out in the invitation.
3.7.
On 1 February 2011 the Commission issued
a
media
release
about
the
invitation
and published same
on
its
website, in the Invitation, the Commission offered firms the
opportunity
to
settle the
alleged
contraventions
of the Act, if
they
would:
3.7.1.
submit
an
application
in
terms
of
PART 2 of the invitation;
3.7.2.
agree to pay an administrative penalty or
penalties
determined
by
the
Commission
as
envisaged in paragraph 10.2 read with paragraphs 19-28 of the
invitation; and
3.7.3.
comply with the requirements of the settlement process as set out in
PART 1 and PART 3 of the Invitation.
3.8.
This agreement sets out the detail of the non-prescribed prohibited
practices only
which
the
respondent is liable to settle regard
being
had
to section 67(2) of the
Act
and
the
penalty
is calculated
taking
into
account only the
said
non-
prescribed prohibited practices.
3.9.
Applying firms were required to
inter
alia
provide
the
Commission
with
truthful
and
timely
disclosure of information and documents relating to the prohibited
practices and to provide full and expeditious co-operation
to the
Commission concerning the prohibited
practices.
3.10.
An
applying
firm
could request
the
Commission
to consider its application in terms of the Invitation as an
application
for
a
marker
or
as
an
application for immunity under the
CLP.
Firms
could
also
apply
for a marker or for immunity under the CLP
before
making an
application
in terms of the
Invitation.
3.11.
The deadline to apply for a settlement in terms of the invitation was
12h0Q
on
15
April 2011.
4.
Applications by Murray & Roberts
4.1.
Murray & Roberts applied for leniency and Settlement in
terms
of
the
Invitation. Murray & Roberts Limited is
a
building,
industrial and
civil
projects
contractor that leverages from its engineering
expertise
and
industrial design
competence
to
deliver
major
construction
projects in
South
Africa.
Murray &
Roberts
is
primarily
focused
on
resources
driven construction markets
in
industry and mining, oil and gas, as well as power and energy. It
offers
civil,
mechanical,
electrical,
mining
and process engineering, general building and construction
operations.
4.2.
Murray & Roberts applied on 15 April 2011 to participate in the
Construction Fast Track Settlement Process. Murray &
Roberts
disclosed
a
total of Twenty One (21) prohibited practices (19 projects and 2
meetings). Out of the twenty-one (21) prohibited practices,
five
(5)
are prescribed prohibited practices and the balance of
sixteen
prohibited
practices
(14
projects
and two (2) meetings)
are
not
prescribed.
Of
these
16 non-prescribed prohibited practices, 4
projects
are
the subject of investigations completed by the Commission prior to
the Invitation and therefore
fall
outside
the scope of
the
CFTP.
This leaves 12 prohibited practices (10 projects and 2 meetings).
4.3.
Out of the 12 non-prescribed prohibited
practices,
Murray
&
Roberts
was
first to
apply
for
5 non-prescribed
prohibited
practices
(4 projects and 1 meeting). Murray & Roberts is not first to
apply for 7 non- prescribed prohibited practices (6
projects
and
1 meeting).
4.4.
Murray & Roberts is further implicated
in
11
non
prescribed
prohibited
practices (10 projects and 1 meeting) which it did not
disclose
Murray
& Roberts has agreed to settle 10 of these.
4.5.
The total number of prohibited practices being settled under the
Consent Agreement is seventeen (17) non-prescribed prohibited

practices. Eleven (11) prohibited practices are in the Civil
Engineering sub-sector, 2 prohibited
practices
are
in the General Building sub-sector,
and
4
prohibited
practices are in the Mechanical Engineering sub-sector.
4.6.
The 17 prohibited practices or
contraventions
by
Murray & Roberts of section 4(1Xb)(ifi) of the Act which are the
subject
of
this
Consent
Agreement,
are set out below.
5.
Disclosed meeting and projects
5.1.
2006 Road Contractors1 Meetings
Murray
& Roberts through
its
subsidiary,
Concor Limited (Concor), reached
agreement
with
Aveng,
Raubex,
WBHO,
Haw & inglis and Basil Read on or about 2006,
in
that
they were attendees at
the
2006
Road Contractors Meeting where they agreed to aiiocate
tenders
for
the
construction
of roads. There was
also
an
agreement in terms of which
firms
who
were not interested
in
the
projects or in
winning
the
tenders, or were not allocated
a
project,
would submit cover bids to ensure
that
those
that were interested in winning particular bids, won them. This
conduct Is collusive tendering in contravention of section
4(1)(b)(iii)
of
the Act.
5.2.
Gauteng
F
reeway
Improvement
Project (“GFIP”) - Package
A
[TENDER
NO:
NRA N1 001200-20(18/1], Package B [TENDER NO:NRA N1 001-200-
2008/2],
Package-E [TENDER NO:-NRA-N1-003-120-2008M
Concor
in joint venture
with
Stefanutti
reached agreement with WBHO
on
or
about 2006 in respect of the Gauteng Freeway
Improvement
project
(“GFIP")
which comprised of three packages, namely; Package A, B and E. In
terms
of
the
agreement Concor,
Stefanutti
and
WBHO
agreed
to
allocate
the
various
packages
among
themselves. They further agreed to exchange cover prices to give
effect to the
allocation
arrangements.
This conduct is collusive tendering in contravention of section
4(1
)(b)(irl)
of
the Act.
The
project was for the addition of ianes,
construction
of
retaining walls, bridges and structure as well as various
intersections on the southern sections of
freeways
around
Johannesburg. The client for the project
was-SANRAL.
The tender for Package A was awarded to Group Five,
Package
B was awarded to WBHO,
and
Package
E was awarded
to
Group
Five. The projects for Package A,
B
and
E were completed in 2010.
5.3
Komati Chimney Project (Tender Rot No: 4600007468)
Concor
reached agreement with Grinaker LTA on or about November 2006 in that
they agreed on a cover price in respect of this project,
in terms of
the agreement Grinaker LTA gave Concor a cover price so that Concor
could submit a non-competitive bid to enable Grinaker
LTA to win the
tender. Grinaker was awarded the tender in line with the collusive
arrangement This conduct is collusive tendering
in contravention of
section 4<1)(b)(iii) of the Act.
The
project was for the
design
and
construction of
a
single
chimney
with two steel flues, for Eskom Holdings Limited. The project was
completed on 30 November 2006.
5.4.
National
Route
5,
Section 4 between Senekai and Vaalpenspruit
Contract
(Tender Ref
No:
NRA
005
040 2008/1)
Concor
reached-agreement with Group Five on or about December 2006
in
that
they
agreed
on
a
cover
price
in
respect
of
this project, in terms of the agreement, Concor gave a cover price to
Group Five so that Group Five
could
price
lower than the cover price and enable it to win the tender. Group
Five
was
awarded
the tender in
line
with
the
cover
price
agreement.
This conduct is collusive tendering in contravention of section 4(1
)(b)(iis)
of
the Act.
This
project
was
for
the
rehabilitation
of the National Route 5, Section 4 between Senekai and Vaalpenspruit,
for SANRAL.
5.5.
PPC Dwaalboom Pre~Heater Towers (Tender Ref No: DB05)
Concor
reached
agreement
with
Stefanutti,
Grinaker
LTA
and
Group
Flve
on or about July 2006 in that they agred on a cover price in respect
of
this
project, in terms
of
the
agreement Concor provided a cover price
to
Stefanutti,
Grinaker LTA and
Group
Five
so that
Stefanutti,
Grinaker
LTA
and
Group Five couid
price
higher
than Concor to
enable
Concor
to win the
tender.
Concor
was awarded the tender
in
line
with
the
cover
price
agreement.
This
conduct is collusive tendering in contravention of section
4{1)(b)(lii)
of
the Act.
This
project
was
for
the
construction
of
a
pre-heater tower at
Dwaalboom
for
Pretoria
Portland
Cement. The project was completed
on
7 January 2008.
5.6.
PPC
Dwaalboom
Raw
Coal
Mill
(Tender Ref No: DB09)
Concor
in joint venture
with
Stefanutti
(“Concor-Stefanutti
JV0)
reached
agreement with WBHO
and
Grinaker
LTA,
on
or
about September
2006
in
that
they
agreed on a cover price in relation to this
project.
In
terms of the cover price agreement Concor-Stefanutti JV provided
WBHO
and
Grinaker
LTA
with a cover price so that WBHO and Grinaker LTA could price higher
than Concor-Stefanutti JV to ensure that the Concor- Stefanutti
JV
won the tender. In line with
the
cover
price agreement, the Concor-Stefanutti JV was awarded the tender.
This
conduct
is collusive
tendering-in
contravention of section 4(1 )(b)(iii) of the Act.
This
project was for the civil works for the Dwaalboom expansion for
Pretoria Portland Cement Company (Pty) Ltd. The project was
completed
in August 2009.
5.7.
The New Board Factory at
Ugie
PG
Bison
(Tender
Ref
No:
EOS-536)
Concor
in joint venture with Grinaker-LTA and Trencon Construction (“the
Joint Venture") reached agreement with WBHO
on
or
about
April
2006,
in
that
Grinaker-LTA,
on
behalf
of
the
Joint
Venture,
requested WBHO to refrain
from
submitting
a tender to allow the Joint Venture
to
win
the
tender In accordance with the collusive agreement
the
tender
was awarded to the Joint Venture. This conduct is collusive tendering
in contravention of section 4(1)(b)(iii) of the Act.
This
project was for the construction of a new plant for the production of
particle
boards
in Ugie, for P G Bison Limited. The project was completed on
30
September
2009.
6.
Non-disclosed Meetings and Projects
6.1.
Wade
List
Meeting
This
meeting
took place in 2007 between representatives of Wade Walker (Pty) Ltd
(“Wade
Walker"), a
subsidiary
of Murray & Roberts, and Group Five Energy (Pty) Ltd (“Group
Five Energy"), a
subsidiary
of
Group
Five. At this meeting, an agreement was reached between
representatives of Wade Walker and Group Five Energy that certain

upcoming tenders for
electrical
and
instrumentation services would be allocated among them. They
circulated a list of
43
upcoming
projects
and
each identified the projects in the list that they were interested in
winning. This conduct is collusive tendering in contravention
of
section
4(1)(b) (iii)
of
the
Act
6.2.
BKM
Processing
Plant
Project
(Tender
Ref
No:
ASS/BKM/03/0023)
Concor
reached agreement wlth Grinaker-LTA on or about March 2006, in that
they agreed to
allocate
the
BKM Processing Plant Project to Grinaker-LTA. Grinaker LTA and Concor
further
agreed
on
a
mark-up
of 12.5% in relation to
their
bid
prices for this project. To
give
effect
to the allocation agreement they also exchanged cover prices to
ensure that the intended winner wins the tender This conduct
is
collusive
tendering
in
contravention of section
4(1
)(b)(iii)
of
the Act.
The
BKM Processing Plant
Project
involved
the construction of a
processing
plant
and
product
load-out
facility. The Client for the project was Assmang Iron Ore. The tender
was awarded to Concor. The project was completed
on 27 April 2007,
6.3.
BKM Export Rail Line Project (Tender Ref No: ASS/BKM/
060025
)
Concor
reached agreement with Grinaker-LTA
on
or
about March 2006, in
that
they
agreed
to
allocate
the
BKM
Export
Rail
Line Project to Concor. Grinaker LTA
and
Concor
further agreed
on
a
mark-up of 12.5% in relation to their
bid
prices
for
this
project.
To
give effect
to
the
allocation
agreement they also exchanged cover prices to ensure that the
intended winner wins the tender. This conduct is collusive
tendering
in contravention of section 4(1)(b)(iii) of the Act.
The
BKM Export Rail Line Project was for the construction of a rail line
at Sishen mine, in the Northern Cape. The Client for the
project was
Assmang Iron Ore. The tender was awarded to Concor. The project was
completed on 24 February 2007.
6.4.
Hartebeesfontem
Water Works Project (Tender Ref No: TE04/38)
Murray
& Roberts and Concor reached agreement with Grinaker-LTA and
Civiicon (Pty) Ltd ("Civiicon”) on or about
May
2004
in that they agreed on a losers’ fee in respect of this project
in terms of which Grinaker-LTA agreed to pay Murray &
Roberts,
Concor and Civilcon a losers fee In the amount of R500 000 each. This
conduct Is collusive tendering in contravention
of section 4(1
)(b)(iii) of the Act.
This
project involved the construction of a concrete wall on
the
Hartebeesfontein
Water Care Centre for the East
Rand
Water
Care company.
Grinaker-LTA
was
awarded
this tender and
the
project was completed
on
28
September 2007,
6.5.
Kayelekera Uranium Contract
Wade
Walker reached agreement with Group Five Energy in respect
of
this
project on or
about
2007,
in that they agreed to allocate
this
project
to
Group Five Energy.
To
give
effect to this agreement Wade Walker submitted a higher price for
this project to ensure that Group
Five
Energy
won the project The tender was awarded to Group Five Energy
in
line with
the
collusive
agreement.
This
conduct
is
col
l
usive
tenderin
g
in
contravention
of section 4(1 )(b)(iii) of
the
Act
This
project was for the electrification of the uranium processing plant
at Keyalekera mine in
Malawi.
The
project was completed in January 2010.
6.6.
Perkoa Zinc Plant for AIM Resources
Wade
Walker
reached
agreement
with
Group
Five Energy on or about 2007,
in
that
they agreed
to
allocate
this project to Wade Walker
To
give
effect
to the
allocation
agreement
Group
Five Energy submitted a
higher
price
for this project to ensure that Wade
Wafker
won
the project. The tender
was
awarded
to
Wade Walker
in
line
with
the collusive agreement. This conduct
is
collusive
tendering
in
contravention
of section 4(1 )(b)(iii) of the Act.
The
project involved the electrification of the Zinc Processing Plant at
Perkoa mine in Burkina Faso for AIM Resources. The
project
was
cancelled
by the client shortly after it commenced on or about
August
2007.
6.7.
N1 North N1 South and N17 Maintenance Contract
Murray
& Roberts, reached agreement with Group Five,
Basil
Read
and Concor (prior to the merger between Concor and
Murray
&
Roberts in 2006)
in
respect
of this two-part project
on
or
about 2001, in that they agreed on
a
losers1
fee arrangement. In terms of the agreement Group
Five
agreed
to pay
Murray
&
Roberts
and
Concor
a losers’
fee
in
exchange for being allocated the N1 North and N1 South maintenance
contract,
The
parties
to this arrangement further agreed
that
Basil
Read
should
win
the N17 portion of the
project,
and
would
therefore
not
be
paid
a
loser’s fee. In line
with
the
collusive arrangement Group Five paid Murray & Roberts and
Concor
a
loser’s fee after winning the N1 North, N1 South Maintenance
contract, while Basil
Read
won
the N17 Maintenance contract. This conduct is collusive tendering In
contravention
of
section 4(1 )(b)(iii) of the Act.
The
project
involved
the
tolling
and maintenance of the
N1
North,
N1 South, and N17,
which
started
on
or about 2002.
The
client
for the project was SANRAL, and the project was planned to be a 10
year project. The project is still on-going.
6.8.
Berg River Dam (Tender Ref No: TCTA-B2020)
Concor
whilst
in joint
venture
with
Hotchief
(Concor-Hotchief
Joint
Venture) reached
agreement
with
Grinaker
LTA, Group
Five,
WBHO,
and
Western
Cape
Empowerment
Joint
Venture
(The BRP Joint Venture),
as
well
the
Basil
Read,
Ceccon,
Olderbrecht
Joint
Venture,
on
or about 2004, in that
they
agreed
on a losers’ fee in respect
of
this
project, Concor-Hotchief Joint Venture also agreed on a loser’s
fee
with
the
BRP Joint Venture, and the
Basil
Read,
Ceccon, Olderbrecht Joint Venture. In terms of the arrangement they
agreed
that
the
BRP
JV
would win the tender and then pay
a
losers'
fee to Concor-Hotchief Joint
Venture
and
the Basil Read, Ceccon, Olderbrecht Joint
Venture.
In
line
with
the collusive agreement, the tender was awarded to the
BRP
Joint
Venture.
This is collusive tendering
in
contravention
of section 4(1)(b)(lii) of
the
Act.
This
project was for the construction of a dam at the Berg River for Trans
Chaledon Channel Authority. The project
was
completed
on 19 September 2009.
6.9.
Peter
Mokaba Sports Stadium, Polokoane
Concor
reached agreement with G
Liviero
on
or about 2006, in that they agreed on a cover price in respect of
this project. In terms of the agreement Concor provided a cover
price
to
G
Liviero
so
that G Liviero could submit a non-competitive
bid
to
ensure that Concor wins the tender, in line with the
collusive
agreement
Concor submitted the lowest price but the client awarded the
tender
to
WBHO. This conduct is collusive
tendering
in
contravention of section
4(1
XbXiii)
of the Act.
This
project
was
for the construction of a
new
sports
stadium and
complex
in
Polokoane for the Polokoane Municipality.
The
tender
was awarded to WBHO.
6.10.
Gautrain project
Wade
Walker
reached
agreement
with
Group
Five
Energy
in
that they agreed to share the budget prices
for
the
three
stations,
namely;
Pretoria,
Midrand
and
OR
Tam bo Airport. In terms of the
agreement
Group
Five
Energy provided the budget price to Wade
Walker
after
Group
Five
Energy
had
submitted
its
budget
price
to
the
client,
Bombela,
but before the tender
was
submitted. This
conduct
is
collusive
tendering
in
contravention
of
section
4(1)(b)(iii)
of
the
Act.
This
project involved the electrification of Gautrain stations for the
Bombela Concession. The tenders were awarded to Wade Walker.
The
project is still on-going.
7.
Admission
Murray
& Roberts admits that Concor, Wade Walker and Murray &
Roberts
entered
into
the agreements described in paragraphs 5
and
6
above with their competitors,
in
contravention
of section
4(1
)(b) (iii)
of
the Act.
8.
Co-operation
In
so far as the Commission is aware and
in
compliance
with the
requirements
as set out in the Invitation, Murray & Roberts:
8.1.
has provided the
Commission
with
truthful and timely disclosure, including information and documents
in its possession or under
its
control, relating to the prohibited practices;
8.2.
has provided full and expeditious
cooperation to the
Commission
concerning the prohibited practices;
8.3.
has provided a written undertaking that it has immediately ceased to
engage in, and
will
not
in the future engage In, any form of prohibited practice;
8.4.
has confirmed that it has not destroyed, falsified or concealed
information, evidence and documents relating to the prohibited

practices;
8.5.
has confirmed that it has not misrepresented or made a wilful or
negligent
misrepresentation
concerning the material facts of any prohibited practice or otherwise
acted dishonestly.
9.
Agreement Concerning Future Conduct
9.1.
In compliance with the requirements as set out in the Invitation,
Murray
& Roberts
agrees and undertakes to
provide
the Commission with
full
and expeditious co-operation from the time that this Consent
Agreement is
concluded
until
the subsequent proceedings
in
the
Competition Tribunal or the
Competition
Appeal
Court
are
completed. This includes, but is not limited to:
9.1.1.
to the extent
that
it
is in existence and has not yet been provided, providing (further)
evidence, written or otherwise, which
is
in
its possession or
under
its
control, concerning the contraventions contained in
this
Consent
Agreement
9.1.2.
Murray & Roberts will
avail
its
employees and former employees to testify as witnesses for the
Commission
in
any cases regarding the contraventions contained in this Consent
Agreement;
9.3.
Murray & Roberts
shall
develop,
implement
and
monitor
a
competition
law
compliance programme incorporating corporate governance designed to
ensure that its
employees,
man
agement
directors
a
n
d
a
gen
t
s
do
not
engage
in future
contraventions
of the Act.
9.2.
Murray & Roberts shall develop,
Implement
and
monitor a competition
law
compliance
programme incorporating corporate governance designed
to
ensure
that its employees, management, directors a agents do not
engage
in
future
contraventions
of
the
Act,
In
particular,
such compliance programme wili
include
mechanisms
for
the
monitoring
and detection of any contravention of
the
Act.
9.3.
Murray & Roberts shall submit a copy of such compliance programme
to the Commission within
60
days
of
the date of confirmation of the Consent Agreement as an
order
by
the
Competition
Tribunai.
9.4.
Murray & Roberts shall circulate a statement summarising the
contents of this Consent Agreement to all management and operational

staff
employed
at Murray & Roberts within 60 days from the date of confirmation
of
this Consent
Agreement
by
the Tribunai.
9.5.
Murray & Roberts will not in the future engage in any form of
prohibited
conduct
and
will not engage in collusive tendering
which
will
distort the outcome of tender processes but undertakes henceforth to
engage in competitive bidding.
10.
Administrative Penalty
10.1.
Having regard to the provisions
of
sections
58(1
)(a)(lii)
as
read
with sections 59(1 Xa),
59(2)
and 59(3) of the Act, and as
envisaged
in
paragraph 10.2 read with paragraphs 19-28 of
the
Invitation, Murray &
Roberts
accepts that it is liable to pay an administrative penalty
(“penalt/1).
10.2.
According to the
Invitation,
the
level of the penalty is to be set on the basis of
a
percentage
of the annual turnover of Murray & Roberts in the relevant
subsector in the Republic and its exports
from
the
Republic for
the
financial
year preceding
the
date
of the Invitation.
10.3.
The meetings
and
projects
which Murray & Roberts has
been
found
to have contravened the Act fall under the Civil Engineering, General
Building, and Mechanical Engineering CIDB sub-sectors.
10.4.
Accordingly, Murray & Roberts is liable for and has agreed to pay
an
administrative
penalty In the sum of R309 046
455
(Three
Hundred and Nine
Million
and
Forty Six Thousand, Four Hundred and Fifty Five Rand)
which
penalty
Is calculated in accordance with the Invitation.
11.
Terms of payment
11.1.
Murray & Roberts
will
pay
the
amount
set out above
in
paragraph
10.4to the Commission in three payments,
the
first
payment
of
R 103 015 485 within 30 days from
the
date
of confirmation of this
Consent
agreement
by
the
Tribunal.
A
second
payment of
R
103
015
485
exactly one year from the first payment
and
a
third payment of R 103 015 485
exactly
one
year
from the second payment
11.2.
This
payment
shall be made into the Commission's bank account, details of which
are
as
follows:
Bank
name: Absa Bank
Branch
name: Pretoria
Account
holder
Competition
Commission Fees Account Account number: 4050778576
Account
type: Current Account
Brach
Code: 323 345
11.3.
The penalty will be paid over by the
Commission
to
the National Revenue Fund in
accordance
with
section
59(4) of the
Act,
12.
Full and Final Settlement
This
agreement is entered into in full and final
settlement
of
the specific conduct
listed
in
paragraphs 5 and 6 of this
Consent
Agreement
and,
upon
confirmation as an order
by
the
Tribunal, concludes
all
proceedings
between
the
Commission
and
Murray
&
Roberts
in
respect
of
this
conduct
only.
Dated
and signed at PRETORIA
on
the
7
TH
day
of
JULY
2013.
For
Murray and Roberts
Dated
and signed at PRETORIA
on
the
10
TH
day
of
JULY
2013.
For
the Commission
Shan
Ramburuth
Commissioner