The Competition Commission has welcomed the decision of the Competition Tribunal (Tribunal) to confirm as an order, a settlement agreement with TWK Milling (Pty) (TWK Milling). In the agreement, TWK Milling has agreed to pay an administrative penalty of R1 845 863,75.

The Commission’s investigation, initiated in 2007, found that TWK Milling colluded with its competitors to fix the price of milled wheat products. The Commission is proceeding with its case against the remaining respondents, Westra Milling and Paramount Mills. The Tribunal expected to hear the matter in April 2019.

This case dates back to 2007 when the Commission received a corporate leniency application from Premier Foods, which was corroborated by a further leniency application filed by Tiger Brands in the same year. The Commission launched an investigation against Tiger Brands, Pioneer Foods, Foodcorp, Pride Milling and Progress Milling. Other industry players were later also investigated and include TWK, Blinkwater, Godrich, Keystone, Westra, Carolina Mills, Brenner, Paramount, NTK, Kalel, Bothaville and Allem Brothers.

To date, the Commission has concluded settlement agreements worth R613m:

  • Pioneer Foods (Pty) Ltd – R500 000 000;
  • Foodcorp (Pty) Ltd – R88 500 000;
  • Carolina Mills – R4 417 546;
  • Keystone Milling (Pty) Ltd – R6 730 349) and
  • Blinkwater Mills – R10 112 504,20.

Tiger Brands Limited and Premier Foods were granted conditional immunity in terms of the Commission’s corporate leniency policy. The Corporate Leniency Policy is aimed at eradicating and preventing cartel activity as it harms the economy at large. Cartels are a particularly damaging form of anti-competitive agreement often resulting in price increases that are harmful to consumers of goods or services concerned.

Not only does such activity affect consumer welfare, but it also hinders development and innovation in the industries within which this activity occurs. – Press release