Cheese case consent order application before tribunal

The Competition Tribunal will on Wednesday be asked to ratify a consent order in terms of which Lancewood Cheese will pay an administrative penalty of R100 000 for price-fixing.

Lancewood Cheese has admitted that it has contravened the Competition Act by engaging in price-fixing. It has agreed to pay the administrative penalty.

It has also agreed to fully cooperate in the prosecution of milk processors, Parmalat, Ladismith Cheese, Woodlands Dairy, Milkwood Dairy and Nestlé SA who the Commission, has alleged, are engaged in anti-competitive practices.

This negotiated agreement between the company and the Competition Commission follows from an investigation into anti-competitive behaviour in the milk industry which began in February 2005.

The Competition Commission alleges that Clover Industries, Clover SA, Parmalat, Ladismith Cheese,
Woodlands Dairy, Lancewood, Nestlé SA and Milkwood Dairy are engaging in anti-competitive practices in contravention of the Competition Act, namely:

* Exchange of information between competitors
* Milk exchange and supply agreements between milk processors
* Abuse of exclusive supply agreements with the producers
* The fixing of retail prices and market allocation
* The fixing of retail prices
* The fixing of selling price and/or trading of milk and processed products

The commission negotiated a corporate leniency agreement with Clover.

Clover was granted leniency on the sixth charge — the fixing of selling price and/or trading milk and process products — in return for cooperating with the commission in the prosecution of the other milk processors, namely Parmalat, Ladismith Cheese, Woodlands Dairy, Lancewood, Nestlé SA and Milkwood Dairy — I-Net Bridge

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