Oscar’s family in price-fixing cartel scandal
Share this article:
Johannesburg - A company belonging to the family of convicted killer Oscar Pistorius has been implicated in an alleged price-fixing cartel believed to span more than 13 years.
Hendrik Pistorius & Co, the company founded by Pistorius’ grandfather Hendrik, has been charged by the Competition Commission for allegedly fixing prices in the agricultural industry since 1995.
The company is the bedrock of the Pistorius family’s wealth, which has spread into various industries including property development, mining and tourism.
It is run by Pistorius’s uncle, Leo Pistorius, who has other business interests in the mining and tourism sector, and is still chaired by Pistorius’s 95-year-old grandfather Hendrik, who founded the company in 1944.
The commission has filed an application with the Competition Tribunal to have the company fined an administrative penalty of 10 percent of its turnover over the period of the alleged price-fixing.
In its application to the Tribunal, the commission has alleged the company has been involved in fixing the prices paid to agents who distribute the agricultural product aglime, of which the Pistorius family is the largest manufacturer in South Africa.
The commission has confirmed it has granted immunity from prosecution to Grasland Ondernemings, a company also implicated in the allegations.
According to the Corporate Leniency Policy, the commission has the discretion to grant total immunity to a cartel member if the firm is the first to blow the whistle and provide information about the cartel activity.
According to the commission, the company has contravened the Competition Act by entering into agreements with suppliers and sellers of the product, and using the Fertiliser Society of South Africa (FSSA) as a platform for the alleged price-fixing.
The commission also submitted letters written over the period by the chairman of the FSSA informing clients, including Sasol Nitro, a division of chemical giant Sasol, of the price fixed by the bosses of Hendrik Pistorius & Co and other players in the industry.
The group was also allegedly in a horizontal relationship as it was involved in the manufacturing of the product and in the downstream level of the business, which included the retailing and distribution of the product.
“The meetings of the respondents to agree on the rates of agents’ commissions were generally held prior to, during an adjournment of, or after the annual general meeting of the FSSA, and took place at the offices of the FSSA and other restaurants outside the premises of the FSSA,” says the commission in its founding affidavit.
Aglime is a sought-after soil additive produced from limestone and is used to address the problem of soil acidity, a challenge to farmers.
The product is lucrative as it provides nutrients for in-the-soil plants and helps get rid of poisonous substances that may affect their development.
“The commission duly investigated the complaint and found that in or about January 1995 until May 2008 the respondents agreed on the commissions payable by each of the fertiliser companies that employ agents to market, sell and distribute aglime.
“The respondents contravened section 4 (1) (b) (i) of the Act by entering into agreements and/or concerted practice to fix the amounts of the agents’ commissions. The respondents used FSSA as a platform for the above conduct,” said the commission.
The legal representatives of Hendrik Pistorius & Co on Saturday disputed the price-fixing allegations, but refused to comment further as the matter was subjudice.
“The complaint relates to allegations by a disgruntled customer and previous business partner dating back to 2008 and all (and every) allegations of price-fixing are absolutely denied.”
The Sunday Independent