Cross Fire Management (Pty) Ltd v Competition Commission of South Africa

The Competition Commission referred a complaint to the Competition Tribunal alleging that several firms in the fire control and protection systems industry engaged in collusive tendering in contravention of section 4(1)(b) of the Competition Act 89 of 1998. Cross Fire Management (Pty) Ltd was alleged to have participated in an overarching collusive arrangement involving cover bidding. Cross Fire admitted participation in 14 collusive tenders, the latest of which occurred in July 2009. The Commission initiated its complaint on 13 March 2015. Cross Fire contended that it withdrew from the collusive arrangement by mid-2009 and that any prohibited conduct had ceased more than three years before the complaint was initiated, rendering the complaint time-barred under section 67(1) of the Act. The Tribunal nevertheless found that Cross Fire contravened section 4(1)(b) and imposed an administrative penalty. Cross Fire appealed to the Competition Appeal Court.

The appeal was upheld. Paragraphs 2 and 3 of the Competition Tribunal’s order were set aside and replaced with an order dismissing the Commission’s complaint against Cross Fire Management (Pty) Ltd. The Commission’s application for condonation was dismissed. The Commission was ordered to pay Cross Fire’s costs, including the costs of two counsel.

The case clarifies how cessation of participation in a cartel is assessed for purposes of section 67(1) of the Competition Act. It underscores that withdrawal from an overarching collusive arrangement can be established through credible evidence of repudiation and subsequent independent conduct. The judgment also illustrates the evidentiary burden on the Commission to prove continuation of prohibited conduct within the statutory time bar.