The Competition Commission has referred a collusion case in the steel industry to the Competition Tribunal and has requested that the tribunal impose a penalty of 10% of each of the steel producers' annual turnover in South Africa.

The commission's investigation was the result of a complaint received in 2008, which alleged that Arcelor Mittal South Africa Limited and Highveld Steel and Vanadium Corporation Limited had adjusted their prices for steel products at approximately the same time and with similar percentage increases.

The commission's investigation revealed that Highveld followed Mittal's prices for steel products. The investigation also revealed that the steel producers agreed to split the markets for steel products according to specific types of goods in order to maintain their market shares and allocate supply quotas for exports. The arrangements regarding exports included agreements with the European steel producers' association, Eurofer.

The commission found that the parties were able to engage in this conduct through information exchanges on sales volumes, which allowed them to monitor and maintain their market shares and prices. These exchanges were facilitated through meetings of the steel industry association, the South African Iron and Steel Institute.

For further information on this topic please contact Lesley Morphet at Webber Wentzel by telephone (+27 11 530 5000), fax (+27 11 530 5111) or email ([email protected]).