Sasol Oil (Pty) Limited v Nationwide Poles CC

Sasol Oil (Pty) Ltd, a subsidiary of the Sasol group, produced and supplied creosote, a wood preservative used by pole treatment firms. Nationwide Poles CC, a small pole producer in the Eastern Cape, discovered that Sasol charged it higher prices for creosote than those charged to larger competitors under a volume-based discount pricing system. Sasol was found by the Competition Tribunal to be dominant in the creosote market, with a market share exceeding 45%. Nationwide Poles alleged that Sasol’s volume-based discounts constituted prohibited price discrimination under section 9(1) of the Competition Act 89 of 1998, as the differential pricing substantially lessened or prevented competition in the downstream treated poles market. The Tribunal upheld the complaint and Sasol appealed to the Competition Appeal Court.

The appeal was dismissed and the finding of the Competition Tribunal that Sasol Oil (Pty) Ltd had contravened section 9(1) of the Competition Act by engaging in prohibited price discrimination was upheld.

This case is a leading authority on the interpretation of section 9 of the Competition Act and the prohibition of price discrimination by dominant firms. It clarifies that complainants need not prove actual consumer harm, but must show that the conduct is likely to have a substantial, non-trivial anticompetitive effect. The judgment affirms the protective role of competition law for small and medium-sized enterprises against exclusionary conduct by dominant suppliers.