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Froth over ‘abuses’ by beer giant

South African Breweries (SAB) was accused of abusing Competition Tribunal processes during this week’s hearing into the beer giant’s alleged anti-competitive practices.

The claims of abuse were in response to an application by SAB aimed at forcing Metcash Group chief executive Peter Dodson, a witness for the Competition Commission, to hand over a wide range of documents and data from his business.

SAB’s counsel dismissed the abuse claims as “ludicrous”, arguing that SAB was merely requesting documents it needed to cross-examine the commission’s witnesses.

The charge of abuse was levelled by both the counsel for the commission, Anthony Gotz, and the counsel for Dodson, Rafik Bhana, in argument against SAB’s application.

Calling the application “half-baked”, Bhana insisted that the SAB wanted to use the documents to “embarrass” Dodson.

“This is nothing more than an attempt to get hold of documentation that is confidential and private to Metcash,” said Bhana.

Gotz referred to the application as a “trial within a trial” and said it was a “clear instance of abuse by SAB”.

The application by SAB followed an earlier attempt by the beer giant to secure more documentation from another of the commission’s witnesses, Darron Swersky, the managing director of Bacardi Rebel Group.

After lengthy negotiations, the commission and SAB agreed on a process to secure the relevant information from Swersky.

But they could not agree on the Dodson matter, forcing the tribunal to rule on the application.

If the tribunal rules in SAB’s favour, the hearing is likely to come to a halt, as it may take weeks to source all the relevant documents and information.

The hearing was set to end on August 27, but it appears that it will not be finalised by then.

‘Normal part of the legal process’
SAB spokesperson Robyn Chalmers said that Dodson had made wide-ranging claims during his testimony before the tribunal.

In particular, he had said that he was able to distribute to any part of South Africa with a maximum lead time of 24 hours from the time of order, saying this was a vast improvement on the SAB network.

“During the normal course of such proceedings, statements made by witnesses are tested at least in part against relevant company documents,” said Chalmers.

“SAB’s request for such documents is a normal part of the legal process and this can in no way be construed as an attempt to intimidate a witness.”

David Unterhalter, the counsel for SAB, argued that the commission’s case was “shifting”, as it was trying to introduce new evidence from witnesses that was not addressed in the founding affidavits or witness statements.

SAB’s counsel took exception to Dodson’s claims that his business could distribute SAB products more efficiently than its appointed distributors.

Independent distributors argue that they are getting a raw deal from SAB as they are not offered the same discount as its appointed distributors, meaning that they cannot compete on price.

SAB is facing four charges of contravention of the Competition Act, including market allocation and price-fixing.

The commission alleges that SAB carved up markets with third-party distributors; curbed distributors’ ability to stock rival products; gave preferential discounts to its chosen distributors; and fixed prices with its distributors.

SAB rejects the allegations.

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Lloyd Gedye
Lloyd Gedye
Lloyd Gedye is a freelance journalist and one of the founders of The Con.

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