Why is it illegal for South African firms to collude with one another?

Originally Answered: Is it legal for South African firms to collude with one another? No, it’s not legal. The South African Competition Act, No 89 of 1998 deals with this. The Competition Commission is constituted in terms of the Act and investigates, controls and evaluate business practices such as price collusion.

Is it legal for South African firms to collude with one another to set prices provide evidence?

No it is not. The Competition Act of 1998 and recent amendment makes it illegal and carries heavy fines and even imprisonment of CEO’s of offending companies.

Which companies in South Africa have been convicted of collusion and price fixing and what did they do wrong?

The Competition Tribunal has found two Johannesburg-based fire control firms guilty of fixing prices, dividing markets and tendering collusively in the market for supplying, installing and maintaining fire control and protection systems. Cross Fire Management (Pty) Ltd has been ordered to pay a fine of R12.

Why do oligopolies collude?

Firms in an oligopoly may collude to set a price or output level for a market in order to maximize industry profits. Oligopolists pursuing their individual self-interest would produce a greater quantity than a monopolist, and charge a lower price.

Which institution imposes fines on companies that are guilty of collusion in South Africa?

The Competition Commission
The Competition Commission, Competition Tribunal and Competition Appeal Court play an important role in the administration of the Act. Companies that are suspected of collusion are investigated and if they are found guilty, they are fined heavily.

What makes it easier for firms to collude?

If a firm sees that all other firms are keeping prices high and restricting output, then it may also do the same. Collusion is thus easiest in markets with fewer firms and where the price of the commodity is readily gauged by all firms.

Why do oligopolies often collude Although it is illegal in South Africa?

One possible explanation is that government is aware that some of the sections may be unconstitutional. It may be trying to avoid unintended consequences or difficulties in the operation and credibility of the amendments.

Is competition illegal in South Africa?

The Competition Act of 1998 and recent amendment makes it illegal and carries heavy fines and even imprisonment of CEO’s of offending companies. That said… it appears to be very poorly monitored and regulated in South Africa and as we no longer have an effective Consumer Protection Agency or Council as was the case pre 1994.

Is South Africa doing enough to protect the consumer?

Yes it is, South Africa has laws that attempt to protect the consumer, but companies always try to circumvent the laws, companies found guilty are fined, but most of them keep a kitty with money for the fines, they see it just as another operational expense, because the profits are attractive.

Who is involved in the price fixing of the Rand?

Feb 15, 2017 – Three South African banks have been implicated among 17 banking groups in ‘widespread’ collusion relating to the the price – fixing of the rand. South Africa. Tiger Brands admits to bread price – fixing, pays fine. Tiger Brands was fined R98,8m by the country’s competition authority after admitting that it

Are banks colluding to raise petrol prices?

Bank charges, various levies and penalties that are continually added to and with continual price increases seem to strongly suggest collusion among banking companies. Petrol prices continually go up… but when Rand/dollar exchange is favorable and oil price down, petrol prices do not drop proportionally compared to when fuel price is increased.