8 August 2022

International Cases

The Competition Commission Of South Africa vs. Group Five Construction Limited



MRTP/ Competition Laws

High Court would have jurisdiction over matters specified in Section 62(2) of Competition Act, 1998, unless such jurisdiction was specifically and expressly ousted

Present is an appeal against a decision of the High Court, in terms of which it dismissed an application under Rule 30 of the Uniform Rules , brought by the Appellant, the Competition Commission (the Commission) established in terms of Section 19 of the Competition Act, 1998 (the Act). In that application the Commission challenged, the high Court’s jurisdiction to determine a review application initiated by the Respondent, Group Five Construction Ltd (Group Five).

The issue before present Court is relating to the interpretation and application of Section 62 of the Competition Act, 1998. On 10 February 2009, the Commission initiated a complaint in terms of Section 49B(1) of the Act against various construction Companies, including Group Five, into conduct relating to the construction in South Africa of FIFA 2010 World Cup stadia.

The Commission decided to investigate possible collusive conduct between various companies in contravention of Section 4(1) of the Act. Group Five allegedly sought to take advantage of the Commission’s Corporate Leniency Policy (CLP) by providing information that would assist to uncover the prohibited practices. It applied for immunity in respect of a cover price it had sought from another firm; and in exchange for submitting a cover bid in respect of the Greenpoint World Cup Stadium, among others. Group Five alleged that, the Commission gave it an unequivocal undertaking to grant it immunity, but later reneged on its earlier decision. On 12 November 2014, despite the alleged undertaking, the Commission referred a complaint against Group Five and other construction companies for contravening Sections 4(1)(b)(i) and 4(1)(b)(ii) of the Act to the Competition Tribunal (Tribunal) and sought a 10% administrative penalty against Group Five.

Section 62(1) of the Act conferred exclusive jurisdiction on the Tribunal and the Competition Appeal Court (CAC) in respect of specialist matters dealing with the interpretation and application of prohibited practices in Chapter 2, merger control in Chapter 3, and investigation and adjudication procedures in Chapter 5 of the Act. Exclusive jurisdiction was also conferred on adjudication of matters in Sections 21(1), 27(1) and section 37 pertaining to the functions of the Commission, the Tribunal and the CAC. Section 62(1) of Act excluded matters listed in Section 62(2) of Act, in respect of which the CAC had additional jurisdiction.

As indicated in 62(3) of the Act, the CAC’s jurisdiction was neither exclusive nor final in respect of a matter in Section 62(2). This indicated that, the jurisdiction of the high Court was not excluded in respect of matters listed under Section 62(2) of Act. The issues of the validity and lawfulness of the initiation and subsequent referral to the Tribunal were questions of vires or of legality, quintessentially issues within the jurisdiction of the Superior Courts. The high Court was correct in its finding that the challenge of jurisdiction had no merit. Appeal dismissed.

Tags : Provision Applicability Jurisdiction

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