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JOHANNESBURG - Plasser South Africa, which provides railway lines track construction and maintenance services, has reached a settlement with the Competition Commission in terms of which it has admitted to its involvement in collusion and agreed to pay a R8.4 million fine. 

Sipho Ngwema, the head of communications at the commission, said yesterday that Plasser admitted to colluding with Lennings DEC Rail Service, a division of listed construction and engineering company Aveng, on tenders for railway construction and maintenance issued by Transnet between 1997 and 2013. 

Ngwema said Lennings and Plasser agreed to allocate railway construction and maintenance tenders among themselves. The settlement follows the commission initiating an investigation against Plasser and Lennings in February 2014, which found that, in contravention of the Competition Act, Lennings agreed with Plasser to engage in tender allocation and cover price arrangements in relation to tenders for railway construction and maintenance contracts issued by Transnet. 

The last tender subjected to this arrangement was the Dynacat tender, issued by Transnet in 2004 and concluded in 2013; the agreement was that the first phase of the tender would be allocated to Plasser and the second phase allocated to Lennings. Apart from the fine, Plasser undertook to refrain in future from contravening the Competition Act.