JOHANNNESBURG - Four companies have been referred to the Competition Tribunal for prosecution for price fixing and tender collusion on a March 2015 Eskom tender worth R4.5billion, despite the power utility withdrawing its complaint to the Competition Commission.
Sipho Ngwema, the head of communications at the commission, said yesterday that the tender was for the supply, installation and dismantling of scaffolding and thermal insulation for all of the 15 Eskom coal-fired power stations.
Ngwema said the commission’s investigation discovered evidence of price fixing and collusive tendering by Waco Africa, acting through its SGB Cape division; Tedoc Industries; Mtsweni Corrosion Control; and Superfecta Trading 159 and three joint ventures which SGB Cape formed with each of these companies through bilateral agreements.
He said the investigation, among other things, found that SGB Cape concluded bilateral agreements with each of Tedoc Industries, Mtsweni Corrosion Control and Superfecta Trading to form three separate joint ventures to be used to tender collusively; SGB Cape submitted bids on its behalf and on behalf of the three joint ventures; and SGB Cape priced the bids in such a way that it manipulated the prices quoted by itself and the respective joint ventures.
Tedoc, Mtsweni and Superfecta were all human resource companies and offered services that included recruitment, placement, payroll and all human resources related administration and management.
The commission said 31 suppliers had responded to the tender, which was to retain or substitute SGB Cape as the provider of these services, when it closed in April 2015.
It received a complaint from Eskom in March 2016 in which the power utility alleged that SGB Cape and the three joint ventures may have colluded when bidding for the tender.
The commission said Eskom suspected collusive tendering had taken place, because SGB Cape submitted multiple tenders, one on its own and three others as a member of joint ventures; the same person signed all four tender submissions; and safety, financial, technical and quality documents in all four bids were identical.
It said Eskom withdrew its complaint in March last year, but the commission decided to continue with its investigation of the withdrawn complaint in terms of commission rules.
Ngwema said the commission was not aware of the reasons for Eskom withdrawing its complaint. The commission added that SGB Cape, as the current service provider, interdicted Eskom from disqualifying it and awarding the tender to a new supplier.
This led to Eskom terminating the tender, resulting SGB Cape continuing to render the services to Eskom.