Blow for Standard Bank, Waco as Constitutional Court rules in competition watchdog's favour

The Constitutional Court has set aside an earlier decision by the Competition Appeal Court ordering the Competition Commission to grant access to its investigation records before the respondents in two high-profile collusion cases answered the case against them.

According to the Commission, the Constitutional Court ruling will speed up the resolution of the cases at hand – namely a prominent forex collusion case in which several major banks were initially named, and a tender collusion case involving the provision of scaffolding to Eskom – as well as potentially relieving bottlenecks in other competition cases.  

The judgment, handed down on Friday, was on three consolidated applications for leave to appeal brought by the Competition Commission against decisions of the CAC and the Competition Tribunal.

The applications involved Standard Bank, which had been accused of rand/ dollar currency manipulation through coordinated activities with the other banks in a case dating back to 2017; and a group of seven companies known as the Waco respondents, who were being investigated relating to a R4.5 billion tender to supply scaffolding to Eskom.  

In the case of Standard Bank, the Competition Commission had referred a collusion case involving 17 banks to the Tribunal, Fin24 previously reported. It accused Standard Bank of being involved in rand/dollar currency manipulation through coordinated activities with other banks. Standard Bank appealed to the CAC, which ruled in its favour.

In the case of Waco, the Commission filed the case against it and other firms involved in February 2018, accusing the group of collusive tendering and price fixing. Waco also approached the Competition Tribunal in a bid to have the Commission produce the record of its investigation before it answered. It, too, received a favourable ruling.

The Commission subsequently appealed the case directly to the Constitutional Court and asked for it to be consolidated and heard together with the Standard Bank case, it said in a statement.

The dispute underlined the question of whether the respondents involved in litigation with the Commission have the same right of access to the information held by a public body as members of the public do, according to the Constitution, said the Commission.

In a statement issued by the Constitutional Court, it said a distinction must be made between the two.

The Commission said the case paved the way for Standard Bank and Waco to file answers to the cases they faced promptly. 

It also said the judgment could relieve bottlenecks at competition authorities that had been caused by several respondents asking for the record of investigations before they could answer cases against them.

"The clarification of this important point of law by the highest court in the land will go a long way in facilitating the resolution of cases by the competition authorities in a timely manner," the Commission said.

Standard Bank said the rulings concerned procedural issues and had "no bearing on the merits of the issues between the parties". 

The rulings would simply postpone the date by which it would be entitled to view the evidence relied upon by the Commission, it added. However, it said, it was unable to determine the substance of the allegations against it, and maintained these were unsubstantiated.

Waco Africa could not immediately be reached for comment outside of normal office hours. Should a response be forthcoming, this story will be updated.