JOHANNESBURG - The Competition Commission has referred an additional 17 collusive tendering, price-fixing and market division charges against bankrupt global airbag and seatbelt manufacturer and supplier Takata Corporation of Japan and its local arm, Takata South Africa, to the Competition Tribunal for prosecution.
This follows the commission referring four charges against Takata Corporation and Takata South Africa to the tribunal for prosecution in March.
The latest charges involve collusion related to tenders issued between 2006 and 2011 by BMW, Toyota and VW tenders for the manufacture and supply of a variety of automotive components, including airbags, seat belts and steering wheels. The four charges referred to the tribunal in March involved price fixing, market division and collusive tendering on tenders issued for Honda, BMW and Toyota vehicle models.
The commission was not seeking penalties against other global players and their local affiliates implicated with Takata.
These include Autoliv Inc, Autoliv SA, TRW Automotive Inc and TRW Occupant Restraints South Africa IncTRW was first to apply for immunity from prosecution, which was granted. Autoliv, one of the world’s largest manufacturers of airbags, seat belts and steering wheels, signed a settlement agreement with the commission, which was confirmed by the tribunal last year. In terms of that agreement, Autoliv agreed to pay a fine of R149.96 million for engaging in a number of prohibited anti-competitive practices in tenders issued by BMW and Volkswagen for the manufacture and supply of airbags, seat belts and steering wheels.
Tembinkosi Bonakele, the competition commissioner, said yesterday that the uncovering and prosecution of this international cartel confirmed the commission’s position as one of the elite global anti-cartel enforcers. “The cartel on car parts is one of the most extensive global cartels affecting most vehicle models and therefore a significant number of consumers globally, including South Africa.
“The affected vehicles are among the most popular in our market. Its effect would have been a price increase in the prices of affected motor vehicles,” he said.
The Competition Commission in March this year approved, with conditions, a proposed merger in terms of which Joyson KSS Holdings No 2 and Joyson KSS Automotive Safety SA intended to acquire Takata Corporation.
The conditions were imposed to ensure payment of any fines imposed on Takata by the tribunal. Sipho Ngwema, the head of communications at the commission, said at the time the conditions imposed on the proposed transaction would ensure the preservation of any claims the commission may have against Takata in the event that an administrative penalty was levied against Takata. Ngwema confirmed that apart from commission concerns about the merger enhancing collusion in the market, it was concerned the proposed transaction might be used to shield Takata from any possible administrative penalty that may be levied on Takata if it was found guilty of contravening the Competition Act.
He said the commission believed acquisition of control by Ningbo Joyson over the Takata business that was alleged to be involved in cartel conduct, resulting in Takata being absorbed by Ningbo Joyson, would result in uncertainty about which firm would be liable for the administrative penalty flowing from the cartel investigation in the event that an administrative penalty was imposed.
Takata has admitted to cartel conduct in other jurisdictions. The company is undergoing bankruptcy proceedings in various jurisdictions. It was part of the largest-ever car safety recall following the incidents in which its airbags exploded, resulting in injuries and some deaths.
- BUSINESS REPORT