Car carrier in hot water for collusion
The Competition Commission said on Monday it would refer car carrier company, Kawasaki Kisen Kaisha, for prosecution to the tribunal, for alleged collusion on a tender for transportation.
The Competition Commission said on Monday it would refer car carrier company, Kawasaki Kisen Kaisha (K-Line), for prosecution to the Competition Tribunal for alleged collusion on a tender for transportation of Toyota SA vehicles between 2002 and 2013.
The commission would be seeking an administrative penalty of up to 10% of the annual turnover of the company, for reaching agreement with three other companies on the number of vehicles and frequency of delivery for shipments from SA to Europe.
The decision follows 2015 settlements reached with two competitors — Nippon Yusen Kabushiki Kaisha and Wallenius Wilhelmsen Logistics — which paid administrative fines of R104m and R96m, respectively.
The third company, Mitsui OSK Lines, was not fined after it approached the commission and offered to co-operate, the Competition Commission said. The four firms were found to have fixed prices, divided markets and tendered collusively in violation of the Competition Act, the latest in a string of judgments in 2017 — including findings against the banking sector for currency training.
The commission, which is investigating whether Transnet has overcharged for port operations and container terminals, has previously made findings against transport companies in SA for co-operating on routes.
The commission said in 2015, while shipping firms shared features of airlines, and other transport companies based on regular scheduled services, it did not believe such competition was destructive in SA.
Several countries have offered exemptions to collusion for transport in order to avoid excessive volatility in prices and competition.
In 2012, SAA settled with the commission after agreeing to fix fuel and cargo charges on routes to Hong Kong, while in 2006, SA Express, Comair and SA Airlink were guilty of colluding to fix an identical fuel surcharge levy on tickets for both domestic and international flights.
“SA is a strategic hub for the trade of goods in and out of the Southern African region, any cartel by shipping liners in this region results in inflated prices for cargo transportation,” Competition Commission commissioner Tembinkosi Bonakele said on Monday.
“Cartels of this nature increase the costs of trading in the region and render the region uncompetitive in the world markets. Such cartels have the effect of significantly derailing the economic growth of the region,” he said.
K-Lines in SA referred questions to the Japan headquarters, which could not immediately be reached for comment.
K-Lines is one of the worlds’ three largest shipping companies, with an annual turnover of $11bn in 2015, when it operated 499 container vessels globally.