Constitutional Court says Competition Tribunal can investigate claims not raised in original referral

The South African Constitutional Court has broadened the powers of the Competition Tribunal by ruling that the Tribunal can investigate complaints alleging violations of the Competition Act even when the Competition Commission does not point to a specific violation in its referral. The case at hand involved the Competition Commission’s referral of the grain storage company Senwes to the Tribunal for anticompetitive practices. The practices were a differential tariff for grain storage that favored farmers over traders, as well as a different storage fee for its own trading division. The second practice, known as a margin squeeze, was not raised in the original complaint but was raised during the course of deciding a referral.

The Constitutional Court thereby ruled that the Supreme Court of Appeal erred in overturning a Competition Tribunal ruling. The Supreme Court of Appeal had decided that a complaint relating to a contravention of Section 8(c) of the Competition Act was not part of the referral because the Tribunal called the behavior a margin squeeze. The term margin squeeze does not appear in the Competition Act, and so the court held that the Tribunal did not have the authority to rule on the complaint. The Supreme Court of Appeal then overturned the Tribunal’s ruling that Senwes had engaged in anticompetitive conduct.

Full content: iOL

Related content: Margin Squeeze in the United States and in Europe: Stand Alone Abuse or Refusal to Deal? (Paolo Palmigiano, Lloyds Banking Group)