SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document
in compliance with the law and SAFLII Policy
COMPETITION TRIBUNAL
REPUBLIC OF SOUTH AFRICA
Case No: CR025May12/SA113Aug15
In the matter between:
The Competition Commission Applicant
And
Copper Tubing Africa (Pty) Ltd Respondent
Panel : M Mazwai (Presiding Member)
A Roskam (Tribunal Member)
A Ndoni (Tribunal Member)
Heard on : 16 September 2015
Decided on : 16 September 2015
Settlement Agreement
The Tribunal hereby confirms the settlement agreement as agreed to and proposed by the
Competition Commission and Copper Tubing Africa (Pty) Ltd annexed hereto marked "A",
read with the addendum marked "B".
1 6 September 2015
Date
__________________
Presiding Member
Ms M Mazwai
Concurring: Mr A Roskam and Ms A Ndoni
IN THE COMPETITION TRIBUNAL OF SOUTH AFRICA
(HELOIN PRETORIA)
CT Case No: 56/CR/May 12
CC Case No: 2008 Nov4111
In the matter between
THE COMPETITION COMM ISSION Applicant
and
COPPER TUBING AFRICA (PTY) LTD Respondent
SETTLEMENT AGREEMENT BETWEEN THE COMPETITION COMMISSION AND
COPPER TUBING AFRICA (PTY) TO IN REGARD TO AN ALLEGED
CONTRAVENTION OF SECTION 4(1)(B)(I) OF THECOMPETITION ACT NO. 89 OF
1998, AS AMENDED.
Preamble
The Competition Commission ("Commission") and Copper Tubing Africa (P1.y) Ltd ("CTA")
hereby agree that an application be made to the Competition Tribunal ("Tribunal"} fur the
confirmation of this Settlement Agreement as an order of the Tribunal in terms of section 490
as read with seclions 58 (1)(a}{iii) and 59{1)(a} of the Competition Act No. 89 of 1998, as
amended ("the Act"). on the terms set out below.
1 . Definitions
For the purposes of this Consent Agreement the following definitions shall apply:
1 . 1 . "Act" means the Competition Act, 1998 (Act No. 89 of 1998), as amended;
1.2. "Arkam" means Arkam Trading CC a close corporation duly incorporated in
accordance with the company laws of the Republic of South Africa, with its principal place of
business situated at 11Springbok Road, Longdale, Johannesburg.
1.3. "Commission" means tile Competition Commission of Soulh Africa, a statutory body
established in terms of section 19 of the Act, with its principal place of business at Mulayo
Building (Block C), the DTl Campus, 77 Meintjles Street, Sunnyside, Pretoria, Gauteng;
1.4. "Commissioner" means the Commissioner of !he Competition Commission, appointed
in terms of section 22 of the Act;
1.5. "Complaint" means the complaint initiated by the Commissioner in temrs of section
49B( 1) of the Act under case number: 2008 Nov4111;
1.6. "CTA" means Copper Tubing Africa (Ply) Ltd, a company duly registered and
incorporated in terms of the company laws of tile Republic of South Africa, having its principal
place of business situated at 18 Cleveland Road, Cleveland, Johannesburg, Gauteng;
1.7. "Maksal" means Maksal Tubes (Ply) Ltd, a company duly reglslered and incorporated
in terms of tile company laws of the Republic of South Africa, having its principal place of
business situated at Industry Road, New Era, 1559 Springs, Gauteng;
1.8. "Parties" means the Commission and CTA;
1.9. "Respondent" means CTA;
1.10. "Settlement Agreement'' means this agreement duly signed and concluded between
the Commission and CTA;
1.11. "Tribunal" means the Competition Tribunal of South Africa, a statutory body
eslablished in terms of sec!lon 26 of the Act, with its principal place of business al Mulayo
building (Block C), the DTI campus, 77 Meintjies Street, Sunnyside, Pretoria, Gauteng;and
1.12. “WHS” means Wholesale Housing Supplies (Pty) Ltd, a private company duly
incorporated in accordance with the company laws of the Republic of South Africa, with its
principal place of business situated at 2 Eton Road, Parktown, Johannesburg.
2. The Complaint and Complaint Investigation
2.1. On 03 April 2009, the Commissioner inl!iated a complaint in terms of section 498 (1) of
the Act against Maksal, CTA, WHS and Arkam for possible contravenlion of section 4(1)(b)(i),
4(1)(b)(ii) and 5(1) of the Act The complaint was initiated pursuant to the investigation of a
third party complaint which was lodged with the Commission but was later withdrawn.
2.2. On 14 March 2012, following receipt of a leniency appl cation by Maksal dated 23
November :moo in terms of the Commission's Corporate Leniency Pol cy ("CLP"). The
Commissioner amended the initiation statement of 3 April 2009.
2.3. In its CLP application, Maksal submitted that it and CTA had engaged in price fixing and
market division in the market for the manufacture and supply of copper plumbing tubes in
contravention of section 4(1)(b) of the Act.
2.4. During the course of l!s investigation, the Applicant found that the section 4(1)(b)(ii)
contravention i.e market division, had ceased in 2000 which is more than three years prior to
the Commission's initiation. The Commission therefore non-referred this aspect of the
complaint as it had prescribed in terms of section 87(1) of the Act Regarding the alleged
contravention of section 5(1) i.e restrictive vertical practices, the Commission took a
decision not to refer a complaint wl!h regard to this alleged contravention on the basis of
insufficient evidence.
2.5. The Commission's investigation however revealed that in the period from about early
2006 until al least 2009, CTA and Maksal agreed with each other in respect of price
adjustments for copper plumbing lubes, as well as the liming to effect such adjustments.
3. The Complaint Referral
3.1. Following its investigation, the Commission concluded that the conduct by Maksal
and CTA constituted a contravention of section 4(1)(b)(i) of the Act, in that they agreed,
alternatively engaged in a concerted practice to directly or indirectly lix the purchase or selling
price of copper plumbing tubes.
3.2. In light of its findings, the Commission decidedlo refer the complaint on 5 July 2012 to
the Tribunalfor determination.
4. Statement of Conduct
CTA admits that it has contravened section 4(1)(b)(i) of the Act, In that from the period
commencing early 2006 until at least 2000, it agreed with its competitor, Maksal,to f!X the
selling price of an copper plumbing tube products.
5. Agreement concerningthe Respondent's future conduct
5.1. CTA agraesto:
5.1.1. the extent that it is in existence, provide evidence, written or otherwise, which is in its
possession or under its control, concerning the alleged comraventions coritained in this
Settlement Agreemem.
5.1.2. desist from the conduct deseribed above.
5.1.3. develop, implement and monitor a competition law compliance programme
incorporallng corporate governance designed to ensure that its employees, management,
directors and agents do not engage in future contraventions of the Act In particular, such
compliance programme will Include the following:
5.1.3.1. a competition policy to be drafted and Implemented by CTA;
5.1.3.2. provide specific training on competition law aspects particularly relevant to CTA;
5.1.3.3. ensure that such training wiU be made available lo all new employees joining
CTA. 'furthermore, CTA will update such training annually to ensure on an on-going basis that
it and its members cannot engage in any anti-compelltive actM!les.
5.1A To submit a copy of such compliance programme to the Commission within 00 days of
the date of confirmation of the Settlement Agreement as an order by the Competition
Tribunal;
5.1.5. To circulate a statement summarising the contents of this Settlement Agreement to all
management and operational staff employed at CTA within 00 days from the date of
confirmation of this Settlement Agreement by the Tribunal;
6. Administrative Penalty
6.1. Having regard to the provisions of sections 58(1)(a)(Ul) as read with sections 59(1)
(a),
59(2) and 59(3) of the Act, CTA accepts that it is liable to pay an administrative penalty.
6.2. The parties have agreed that CTA will pay an administrative penalty in the amount of R
8,000,000.00 (Eight million rand);
6.3. This amount does not exceed 10"At of CTA's total annual income in the Republic and its
exports from the Republic for its 2008 financial year;
6.4. CTA will pay the amount set out in paragraph 6.2 above to the Commission within one
month from the date of confirmation of this Settlement Agreement as an order by the
Tribunal.
6.5. The penalty must be paid into the Commission's bank account which is as foftows:
Name: The Competition Commission Fee Account
Bank: Absa Bank, Pretoria
Account Number: […..........]
Branch Code: 323 345
Reference: CTA/ 2008 Nov4111
6.a. The penalty will be paid over by the Commission to the National Revenue Fund in
accordance with the provisions of section 59(4) of the Act.
7. Full and Final Settlement
This agreement, upon confirmation as an order by the Tribunal, is entered into in fulland final
setllement and 0011ciudes aH proceedings betwllen !he Commission and CTA relating to any
alleged contravention of t he Act by the respondent that is the subject of the Commission's
Investigation referred to the Tribunal under CT Case No. 2008 Nov4111.
Date and signed at Simonstown on the 17 th day of August 2015
For Copper Tubing Africa (Pty) Ltd
________________________
David Machet (duly authorised)
Former CEO Of Copper Tubing Africa (Pty) Ltd
Dated and slgned at Pretoria on the 2 4 t h day of August 2015
For the Competition Commission
______________________
Tembinkosi Bonakele
Competition Commissioner
IN COMPETITION TRIBUNAL OF SOUTH AFRICA
(HELD AT PRETORIA)
CTCase No: CR025May121SA113Aug15
CC Case No: 2008 Nov4111
In the matter between
THE COMPETITION COMMISSION Applica n t
and
COPPER TUBING AFRICA (PTY) LTD Respondent
FILING SHEET
BE PLEASED TO TAKE NOTICE that the applicant hereby files the addendum to the
settlement agreement con.eluded between· the Competition Commission and Copper Tubing
Africa (Pty) Ltd.
Dated at PRETORIA on this the 16 th day of September 2015.
_________________________
COMPETITION COMMISSION
DTI Campus
77 Melnljies Street Sunnyside, Pretoria
Tel: 012 394 3335
Ref: K. Ayayee I J. Ngobeni
E-mail: korkoia@comocom .cocza /
jabulanin@compcom.co.za
To: THE REGISTRAR
Competition Tribunal
3rd Floor, Mulayo
The DTI Campus
77 Meintjies Street
Sunnyside, Pretoria
Tel: (0.12) 394-3300/55
E-mail address: Leratom@comptrib.co.za
And to: FLUXMANS INC.
Respondent's Attorneys
30 Jellicoe Avenue, Rosebank Johannesburg; ·SouthAfrica. Tel: +27 11 328 1835
Ref: Andile Nikani
E-mail address a n i k a n i @ f l u x r n a n s . c o m
ADDENDUM TO THE SETTLEMENT AGREEMENT BETWEEN THE COMPETITION
COMMISSION. ANO COPPER TUBING AFRICA (PTY) LTD
The parties agree that the clause set ouihereunder shall replace clause 3.2 of the
attached Settlement Agreement signed by the Competition Commissioner dated 24 Augusf
2015.
3.2 In light of its findings, the Commission decided to refer the complaint on 22 May
2012 to the Tribunal. for determination.
Dated and signed at Rosebank on the 16 th day of Sept 2015
For Copper Tubing Africa (Pty) Ltd
____________________
Andile Nikani (authorised)
Attorney for Copper Tubing Africa (Pty) Ltd
Dated and signed at Rosebank on the 16 th day of Sept 2015
For the Competition Commission
________________________
Bukhosibakhe Majenge (duly authorised)
Chief Legal Counsel