The Competition Commission of South Africa v Group Five Construction Limited

On 10 February 2009, the Competition Commission initiated a complaint under section 49B(1) of the Competition Act 89 of 1998 against various construction companies, including Group Five, concerning alleged collusive conduct in the construction of 2010 FIFA World Cup stadia. The investigation followed research conducted by the Commission in May 2008 prompted by escalating stadium construction costs. Group Five alleged it had applied for immunity under the Commission's Corporate Leniency Policy (CLP) by disclosing information about cover pricing and bid-rigging activities, and that the Commission had granted it an undertaking of immunity. Despite this alleged undertaking, on 12 November 2014 the Commission referred a complaint against Group Five and other construction companies to the Competition Tribunal, alleging contraventions of section 4(1)(b)(i) and (ii) of the Act. The Commission sought an administrative penalty of 10% of Group Five's total turnover. Group Five then approached the Gauteng High Court seeking to review and set aside the Commission's decision to initiate and refer the complaint, arguing that the referral was unlawful because the Commission had granted it immunity, the initiation was invalid, and the referral was oppressive and made in bad faith. The Commission responded not with an answering affidavit but with a rule 30 application challenging the high court's jurisdiction, arguing that the Competition Tribunal had exclusive jurisdiction over the matter.

• Whether the high court has jurisdiction to hear a review application challenging the validity and lawfulness of the Competition Commission's initiation and referral of a complaint to the Competition Tribunal
• Whether the Competition Tribunal has exclusive jurisdiction over such matters under section 62(1) of the Competition Act 89 of 1998
• Whether matters concerning the legality and validity of the Commission's actions fall within section 62(2) of the Act, where jurisdiction is not exclusive
• Whether questions of legality and ultra vires conduct by the Commission constitute constitutional matters falling outside the exclusive jurisdiction of the Tribunal
• Whether the Tribunal has concurrent jurisdiction with the high court in respect of challenges to the validity of the Commission's decisions

The appeal was dismissed with costs, including costs occasioned by the employment of two counsel. The high court's dismissal of the Commission's jurisdictional challenge was upheld, meaning the high court retains jurisdiction to hear Group Five's review application challenging the validity and lawfulness of the Commission's initiation and referral of the complaint.

Challenges to the validity and lawfulness of the Competition Commission's initiation and referral of complaints to the Competition Tribunal are jurisdictional questions falling within section 62(2)(a) of the Competition Act 89 of 1998, which asks whether actions by the Commission or Tribunal are within their respective jurisdictions. Such challenges also constitute constitutional matters under section 62(2)(b) as they involve the principle of legality - a constitutional imperative requiring public bodies to act within their powers. Section 62(3)(b) provides that the Competition Appeal Court's jurisdiction over section 62(2) matters is 'neither exclusive nor final', meaning the high court's ordinary jurisdiction is not excluded in respect of such matters. The exclusive jurisdiction conferred on the Competition Tribunal and Competition Appeal Court by section 62(1) relates only to the interpretation and application of Chapters 2, 3 and 5 of the Act (prohibited practices, merger control, and investigation/adjudication procedures), and does not extend to challenges concerning the legality of the Commission's exercise of its powers under Chapter 4. Unlawful actions are not within the Commission's jurisdiction, and whether an act by the Commission is within its jurisdiction is a matter within section 62(2)(a), not within the exclusive jurisdiction conferred by section 62(1).

The Court made observations about the rationale for granting exclusive jurisdiction to specialist tribunals, noting that matters related to investigation, control and evaluation of alleged restrictive practices, abuse of dominant positions and mergers involve specialist technical expertise at the complex intersection between law and economics, which justifies assignment to institutions best equipped to handle them. The Court cited with approval the Constitutional Court's observations in Baloyi regarding specialist labour courts, and noted that where concurrent jurisdiction exists, it affords litigants an additional right rather than diminishing jurisdiction. The Court also observed that while it would be preferable to use specialist structures designed for effective and speedy resolution of particular disputes, this principle does not apply where the matter falls outside the exclusive jurisdiction of those structures. The Court emphasized that review of the exercise of public power is controlled by the Constitution and legislation enacted to give effect to it, and that review of administrative action under PAJA constitutes a constitutional issue because PAJA gives effect to section 33 constitutional rights.

This judgment is significant in clarifying the jurisdictional boundaries between the high court and the specialist competition law institutions (Competition Tribunal and Competition Appeal Court) under the Competition Act 89 of 1998. It establishes important principles regarding the interpretation of section 62 of the Act, particularly confirming that: (1) challenges to the legality, validity and lawfulness of the Competition Commission's decisions constitute jurisdictional and constitutional questions falling under section 62(2), not matters of exclusive jurisdiction under section 62(1); (2) the high court retains jurisdiction to review administrative actions by the Commission on grounds of legality and ultra vires conduct; (3) not all matters relating to competition law fall within the exclusive jurisdiction of the specialist tribunals - only those specifically enumerated in section 62(1); (4) the principle of legality is a constitutional issue that falls outside the exclusive jurisdiction of specialist tribunals. The judgment reinforces the constitutional principle that public bodies must act within the scope of their statutory powers and that challenges to such conduct can be brought before the ordinary courts. It confirms the approach taken in Agri Wire and provides guidance on when litigants should approach the high court versus the Competition Tribunal, ensuring access to justice while respecting the specialist expertise of competition law institutions.