South Africa: Family owned flour mill “bullied” into cartel

In an ongoing case against the major companies in the milling industry, family owned Godrich Flour Mills’ legal representative told the South African Competition Tribunal that the company was “bullied” into joining price fixing meetings.

Godrich’s representative, Terry Mahon, said, “They participated in the meetings but decided they were not going to implement anything that was agreed and never did.”

Godrich agreed to settle in the amount of US$311,245 for taking part in a cartel that colluded with other maize-milling firms to fix the price of white maize and the dates on which the new pricing would be implemented.

Mahon went on to say that Godrich never approached the commission for help against some of its larger competitors because “in those days” they were unaware of things like the Competition Tribunal.

A complaint in 2007 initiated an investigation into Tiger Brands, Pioneer Foods, Foodcorp, Pride Milling and Progress Milling and was quickly amended to include other participants such as Blinkwater Mills and Godrich.

Although Gordich did not implement any of the decisions taken at the meetings, it acknowledged its failure to disassociate itself from decisions taken at the meetings was a contravention of the Competition Act.

The case is still continuing against Pioneer Foods, Foodcorp, Progress Mills, Westra Milling, TWK Milling, NTK Milling, Isizwe Mills and Paramount Millis. Tiger brands and Premier Foods were the leniency applicants in the case.

Full Content: Business Report

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