Leniency policy under fire

AS THE Supreme Court of Appeal (SCA) let a big company off the hook for its role in the bread cartel, experts have said the Competition Commission needs to clarify its leniency policy.

The SCA recently annulled a Competition Tribunal’s declaration that Premier Foods engaged in a prohibited practice under competition laws.

Without this declaration, Cosatu, the National Consumer Forum and others planning to sue bread cartelists in a class action, cannot sue Premier Foods.

In 2006 Premier Foods, which makes Blue Ribbon bread and owns brands such as Snowflake, Iwisa and Dove, applied for immunity under the Competition Commission’s corporate leniency policy in exchange for assisting the commission with its probe.

It gave evidence against Tiger Brands, Pioneer Foods and Foodcorp, with whom it had also colluded on a national scale.

Despite this, the Competition Tribunal said Premier Foods had broken the law, opening it up to civil claims.

Now the SCA has shut that door, agreeing with Premier’s argument hinged on the leniency policy.

But competition lawyer Jennifer Finnigan said the leniency policy required clarification: “As pointed out by the [SCA], there is some confusion about whether a leniency applicant may be referred to the Competition Tribunal for the purposes of a prohibited practice declaration but not an administrative fine.”

The Competition Commission could not comment at the time of writing and the Tribunal declined to comment.

However, those planning to sue the cartelists will appeal to the Constitutional Court.