The South African Competition Commission (SACC) has conducted an investigation into the dealings of six glass suppliers and has charged them with “cartel conduct” and proposed that a penalty be levied against them.
The SACC had investigated Glass South Africa, National Glass, Northern Hardware and Glass, Furman Glass, McCoy’s Glass and AF-FSL Glass and proposed that an administrative penalty of 10 percent of annual turnover be imposed on each of the firms involved.
According to a report from the SACC, the manufacturers face allegations of price fixing, market allocation and the fixing of trading conditions for float, laminated and toughened glass in the Gauteng, Free State and Western Cape regions of South Africa.
The SACC initiated the investigation in February 2010 based on information it
received in a leniency application by AF-FSL Glass on June 8, 2009, according to today’s report. AF-FSL was granted conditional leniency from prosecution.
In its investigation, the SACC found that between 1995 and 2007 cartel members had telephone conversations and held various “boys’ club” meetings where they fixed minimum selling prices, the percentage by which minimum prices would increase and the date for the implementation of the fixed prices. The alleged meetings were held at hotels, pubs, sports clubs and on boat trips to Zimbabwe, according to the report.
During the meetings, the cartel members further agreed not to undercut one another by providing competitive prices to customers that “belonged” to each other and in 2005 they agreed to introduce a distribution or transport levy of 3 percent of the price charged to customers, according to the report.