Power cable fines levied

THE Association of Electric Cable Manufacturers South Africa (AECMSA) Electric has admitted,Picture: Gallo Images

THE Association of Electric Cable Manufacturers South Africa (AECMSA) Electric has admitted to directly or indirectly fixing the selling price of power cables.

Three companies have agreed to pay administrative penalties of R80.74m, R20.2m and R13.3m respectively. The Competition Tribunal has confirmed an agreement with AECMSA relating to its involvement in fixing the selling price of electric power cables. Customers affected by the contravention were primarily Eskom, large industries and municipalities.

The commission said that all members of AECMSA, including power cable manufacturers agreed on, or engaged in concerted practice in respect of the input prices or costs in respect of raw materials required for the manufacture of power cables based on which indices were calculated and subsequently applied in a price adjustment formula.

Indices in this matter refers to various raw materials and individual rand values as listed from time to time in a document entitled Quotation Bases. AECMSA admits that setting the indices by way of agreement by AECMSA directly or indirectly fixed the selling price of power cables.

In March 2010, the commission initiated a complaint against Abedare Cables, Tulisa Cables, Alvern Cables and South Ocean Electric Wire Company for possible cartel activity in the supply of electric cables.

The complaint was amended to include more electric cable manufactures and AECMA. The manufacturers named in the complaint referral are Alvern Cables, South Ocean Electric Wire Company, Tulisa Cables, Alcon Marepha, CBI-Electric: African Cables, Phoenix Power Cables, Cabcon Technologies, Silcom, Malesela Taihan Electric Cable, Kewberg Cables & Braids, Norco Cables, Aberdare Cables and AECMSA. Some members of the association have paid administrative penalties while Aberdare Cables was granted conditional corporate leniency as part of the investigation.

Malesela Taihan Electric Cable has paid an administrative penalty of R20.2m, ATC agreed to pay R80.74m, and South Ocean Holdings a R13.3m administrative penalty.

AECMSA will pay an administrative penalty of R14 853. This amounts to 1% of AECMSA’s membership fees for 2010, as the association has no turnover.

AECMA’s decision to settle the complaint referral does not amount to a settlement or an acknowledgement of any contravention of any member of AECMA. Members will decide independently whether to admit or deny the contraventions and whether or not they wish to settle with the commission.

-THELMA NGOMA|thelman@afrotone.co.za