Com­mis­sion in mas­sive raid on fire con­trol en­ti­ties

The Star Early Edition - - BUSINESS REPORT - Roy Cokayne

THE COM­PE­TI­TION Com­mis­sion launched its largest si­mul­ta­ne­ous and co-or­di­nated search and seizure raid in a car­tel in­ves­ti­ga­tion in its his­tory on Wed­nes­day when its in­ves­ti­ga­tors swooped on the premises of the Au­to­matic Sprin­kler In­spec­tion Bureau (Asib) and 24 fire con­trol and pro­tec­tion ser­vices com­pa­nies that are mem­bers of Asib.

Sipho Ng­wema, the head of com­mu­ni­ca­tions at the com­mis­sion, said yes­ter­day that the com­pa­nies raided were in­volved in the sup­ply, in­stal­la­tion and main­te­nance of fire con­trol and pro­tec­tion sys­tems.

Chubb Fire and Se­cu­rity KwaZulu-Natal was the most high pro­file com­pany on the list of com­pa­nies that were raided.

Ng­wema said the com­mis­sion had rea­son­able grounds to be­lieve that Asib and its mem­bers had agree­ments and/ or were en­gaged in a con­certed prac­tice to fix prices and trad­ing con­di­tions, di­vide mar­kets and ten­der col­lu­sively.

He said the raids formed part of an on­go­ing in­ves­ti­ga­tion and pros­e­cu­tion in the sec­tor, which had al­ready led to sev­eral Gaut­eng com­pa­nies ad­mit­ting to the con­duct and set­tling with the com­mis­sion.

“This in­ves­ti­ga­tion is par­tic­u­larly con­cern­ing, be­cause of the seem­ingly prom­i­nent role played by con­sult­ing en­gi­neer­ing com­pa­nies in fa­cil­i­tat­ing in KwaZulu-Natal; East Lon­don and Port El­iz­a­beth in the Eastern Cape; and Houghton in Gaut­eng.

Ng­wema said Asib mem­bers were al­legedly required to ad­here to var­i­ous rules and stan­dards which con­sti­tuted an agree­ment to ex­clude non mem­bers from the mar­ket who use legally pre­scribed and ac­cept­able stan­dards in the coun­try. This stan­dard was the South African Na­tional Stan­dards de­vel­oped by the SA Bureau of Stan­dards.

Ng­wema said the Asib rules and stan­dards, among other things, al­legedly in­volved re­serv­ing the in­stal­la­tion of the fire con­trol and pro­tec­tion equip­ment for Asib mem­bers only; re­serv­ing the in­spec­tion of in­stalled fire con­trol and pro­tec­tion sys­tems in the in­dus­try for Asib mem­bers; and pro­hibit­ing Asib mem­bers from sub­con­tract­ing work to non mem­bers.

Asib mem­bers were also al­legedly dis­cour­aged from op­er­at­ing in re­gions where they were not reg­is­tered and Asib re­fused to pro­vide clear­ance to any in­stal­la­tions that had not been car­ried out by its listed mem­bers. Asib al­legedly also listed com­pa­nies as ap­proved sup­pli­ers of pipes, pumps and sprin­klers. In­stallers not reg­is­tered with Asib got no sup­plies.

Asib fur­ther al­legedly di­vided in­stallers into dif­fer­ent cat­e­gories, thereby re­strict­ing com­pe­ti­tion among in­stallers of fire con­trol and pro­tec­tion sys­tems, he said.

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