Tulisa exonerated from involvement in power cable cartel

Published Jan 17, 2019


PRETORIA – The Competition Tribunal has exonerated Tulisa Cables from involvement in price fixing and entering into a collusive agreement with its competitors in a long-running electric cable cartel, whose activities would have hurt Eskom, the mining industry and municipalities.

The case against Tulisa was heard by the tribunal in November 2017, and issuing its order this week.

The case followed the commission in March 2010 initiating a complaint against Aberdare Cables, Tulisa, Alvern Cables and South Ocean Electric Wire Company (SOEW) for possible cartel activity in the market for the supply of electric cables.

The complaint was amended in May 2010 to include more electric cable manufactures and the Association of Electric Cable Manufacturers South Africa.

The commission referred the complaint to the tribunal for prosecution in March 2017, alleging an initial agreement was concluded in May 2001 between Alvern, SOEW, Tulisa and Aberdare in terms of which they agreed to fix the price of power cables sold to wholesalers, distributors and original equipment manufacturers.

It further alleged that after the initial agreement and between 2001 and 2008, these manufacturers held regular meetings and telephone conversations to discuss adjustments to the price of power cables, with no further meetings held after 2008, although prices were fixed until at least 2010.

Based on these discussions, the commission alleged Aberdare would release a price list that would be circulated to Alvern, SOEW and Tulisa for price adjustments to be made. 

The tribunal, in its order, concluded that on the evidence before it that the commission had not established that Tulisa was a party to an agreement or concerted practice, express or inferred, to fix the price of power cables as alleged by the commission.

It said this was because Tulisa ceased to attend the price fixing meetings in June 2006 when its representative at the meetings died and this conduct would have prescribed when the commission initiated its complaint in March 2010.

The tribunal said Tulisa, like the other respondents, based its pricing on Aberdare’s price lists, which it obtained from customers, but there was no evidence on the facts before it that Tulisa was in agreement with the other respondents by their attendance at meetings and direct receipt of Aberdare’s price lists.

“Tulisa’s actions appear to be consistent with those of a player in an oligopoly market acting rationally 

and independently of its competitors but well alive to the actions of its competitors. 

“It is generally accepted that conscious parallel pricing is lawful if it is unilateral as a consequence of the market structure,” the tribunal said.


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