PPC Limited is a manufacturer and supplier of cement. For 12 years, PPC and Temblor Trading (Pty) Ltd t/a EST Building & Hardware (EST), a co-operative buying group with 756 members, concluded annual rebate agreements. EST pooled purchases by its 197 members who bought cement from PPC to earn volume rebates, retaining approximately 20% of the rebate and distributing the balance to members. On 15 November 2024, PPC advised EST it would not renew the rebate agreement for 2025, opting instead to contract directly with individual members and pay rebates directly to them. PPC informed members that small retail stores previously receiving 0.8% rebates would now receive over 3.5%. EST applied to the Competition Tribunal for urgent interim relief under s 49C(2) of the Competition Act. The Tribunal granted an interim order on 31 December 2024 interdicting PPC from refusing to deal with EST and requiring it to supply cement to EST members on pre-existing terms for six months. The Tribunal published its reasons on 22 February 2025. By the time of the hearing, 34 EST members had already concluded direct contracts with PPC under the new 2025 terms. PPC launched both a review application and an appeal.
1. The late filing of the applicant's review application is condoned. 2. The decision of the Competition Tribunal of 31 December 2024 under case number IR133DEC24 is reviewed and set aside. 3. The fifth respondent (EST) in the review application is ordered to pay the applicant's costs on scale C, which shall include the costs of two counsel, where employed.
The binding legal principles established are: (1) Under s 37(1)(a) of the Competition Act, the Competition Appeal Court has jurisdiction to conduct PAJA and legality reviews, and the availability of a statutory review does not oust PAJA remedies where the offending conduct qualifies under PAJA. (2) The Competition Appeal Court may raise the issue of material non-joinder mero motu to safeguard the interests of third parties with direct and substantial interests, and will refrain from dealing with issues affecting such parties without ensuring they are joined or their interests protected. (3) A party has a direct and substantial interest requiring joinder as a matter of necessity where: (a) that party has rights acquired independently of the litigation that would be prejudicially affected if an order were carried into effect; (b) a situation could arise where, because the party was not joined, any order would not be res judicata against that party; and (c) the order impairs existing contractual rights or prevents the exercise of contractual freedom. (4) The failure to join parties with direct and substantial interests and afford them an opportunity to be heard constitutes a violation of the audi alteram partem principle and procedural unfairness under s 6(2)(c) of PAJA warranting review and setting aside of the administrative action. (5) Where a review raises an antecedent procedural question such as material non-joinder, it should be determined before an appeal on the merits, as the court should not determine issues affecting the interests of parties who should have been joined.
The Court made several non-binding observations: (1) The Court noted that the informal letters from EST members supporting EST's position, which were not confirmed under oath and were cast in generic terms, did not address the central question of whether members preferred to contract directly with PPC or through EST, and therefore took the matter no further. (2) The Court observed that the information provided to EST members appeared incomplete and slanted in certain respects, fortifying the need for members to be heard. (3) The Court commented that the Tribunal's reliance on contested evidence submitted after the hearing via spreadsheets, which was not adduced under oath and involved numerous factual disputes, was problematic. (4) The Court indicated that remittal would be impractical given the interim order was close to its six-month expiration, and it was unclear whether there would be sufficient time for papers to be prepared after joinder and for a panel to be constituted and hear the matter. (5) The Court observed that a court enjoying both appeal and full review jurisdiction should not adopt a highly technical approach as it may result in failing to provide access to justice, and therefore a party may legitimately bring both an appeal on merits and a review where grounds exist for both. (6) The Court noted that the Tribunal has wide discretion in managing proceedings under s 55 of the Act and Competition Tribunal Rule 55, and enjoys discretionary power of joinder under Rule 45(1), making it open to the Tribunal to order joinder mero motu.
This judgment is significant for establishing that: (1) PAJA remedies are available in statutory reviews under the Competition Act, including reviews under s 49C(6); (2) the Competition Appeal Court can raise the issue of material non-joinder mero motu, even where not expressly raised before the Tribunal; (3) parties with direct and substantial interests affected by interim relief orders under s 49C must be joined and afforded an opportunity to be heard, in accordance with the audi alteram partem principle; (4) failure to join such parties constitutes procedural unfairness warranting review and setting aside under s 6(2)(c) of PAJA; (5) the sequence of determination between concurrent review and appeal proceedings is fact-specific and depends on whether the review raises an antecedent procedural question; and (6) a party's right to contractual freedom may constitute a direct and substantial interest requiring joinder where an order impairs existing or prospective contractual rights. The case reinforces procedural fairness requirements in competition proceedings and limits the ability of representative bodies to obtain relief affecting the interests of constituents without affording them a hearing.
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