Price-fixing appeal goes sour for Clover

The Competition Appeal Court has rejected a bid by dairy producers Clover and Ladismith Cheese to avoid a price-fixing hearing.

Judge Dennis Davis handed down the ruling in Cape Town on Friday afternoon, saying the court would give reasons later.

Competition Commission attorney Mohamed Husain said afterwards that the decision cleared the way for a Competition Tribunal hearing in Pretoria on November 24. “This ruling today is a major plus for the public benefit,” he said.

Clover faces four charges, including price-fixing, abuse of dominance and fixing trading conditions. Ladismith faces one charge of price-fixing.

Clover was granted conditional immunity on a sixth charge involving two other producers, Parmalat and Woodlands.

In June, Clover and Ladismith lost an initial bid to have the charges dropped when the Competition Tribunal ruled against them on so-called “in limine” points.
They then asked the Competition Appeal Court to overturn that ruling.

Clover also asked the court to rule that it was being treated unfairly in being made to face charges that it said were closely linked to the one on which it had been granted immunity.

“It is simply procedurally totally unfair to charge separately matters so inextricably linked to the leniency,” Clover counsel Malcolm Wallace told the court on Friday.

Much of Friday’s argument centred on whether the June 2004 whistle-blower letter that sparked the entire probe, from Southern Cape small dairy producer Louise Malherbe, was a “complaint” in terms of the Competition Act.

Lawyers for the producers claimed it was. They said the fact that the commission referred the complaint to the tribunal only in 2006, more than the statutory maximum of a year later, meant the case could not go ahead.

Counsel for the commission maintained it was “submission of information”, and not a formal complaint.

Davis, who was sitting with judges Chimain Patel and Lucy Mailula, dismissed both legs of their application, with costs.

Attorney Husain told reporters that this meant the commission would be entitled to proceed against Clover on all four charges.

“The case against the major milk producers has not been stopped as was intended by Clover and Ladismith,” he said. “The commission will proceed with its case against them to show they were involved in anti-competitive practices.”

Also in the dock are producers Parmalat, Nestlé, Milkwood, Lancewood and Woodlands. If they are found guilty, competition law allows a maximum fine of 10% of their turnover.—Sapa