Competition Appeal Court decision greenlights Commission’s prosecution of Sasol Gas
07 Mar 2024
The Competition Commission (Commission) welcomes the Competition Appeal Court (CAC) decision, of 05 March 2024, dismissing Sasol Gas (Pty) Ltd’s (Sasol Gas) review application of the Commission’s investigation into alleged excessive pricing of natural piped gas.
This CAC decision paves the way for the Commission to proceed with the prosecution of Sasol Gas before the Tribunal. The Commission had filed a referral with the Tribunal on 10 July 2023. The CAC decision further re-emphasises the Commission’s mandate to investigate and prosecute excessive pricing complaints in the natural piped gas industry, in terms of section 8(1) of the Competition Act 89 of 1998, as amended (“Competition Act”). The Commission will also be able to obtain the relevant costing data from Sasol Gas that forms the basis of its pricing for natural piped gas.
The Commission had issued Sasol Gas with a summons on 12 August 2022 requesting relevant information to assist with its investigation into the alleged conduct. Sasol Gas, however, refused to respond to the summons and requested interdictory relief from the Competition Tribunal (“Tribunal”). The Tribunal dismissed the interdict against the summons on 12 May 2023. Sasol Gas then approached the CAC seeking the same interdictory relief. On 12 June 2023, the CAC granted Sasol Gas interdictory relief against the Commission’s summons pending the review application. It is this review application that has now been dismissed by CAC.
Background
This prosecution stems from three complaints against Sasol Gas which were lodged, in early 2022, with the Commission by Egoli Gas (Pty) Ltd (Egoli Gas), the Industrial Gas Users Association of South Africa (IGUA-SA), and Spring Lights Gas (Pty) Ltd (Spring Lights). The complainants alleged, amongst others, that Sasol Gas engaged in excessive pricing of natural piped gas in contravention of the Competition Act.
Egoli Gas and Spring Lights are gas traders, and IGUA-SA’s members are industrial gas customers.
As part of its investigation, the Commission issued a summons to Sasol Gas to furnish information in relation to the alleged excessive pricing conduct. Sasol Gas, however, refused to comply with the Commission’s summons and approached the Tribunal to interdict the Commission’s summons. Sasol Gas’ review application to the CAC sought to declare the Commission’s decisions to investigate and issue the summons invalid and unlawful, and to review and set aside those decisions. Sasol Gas contended that the National Energy Regulatory of South Africa (Nersa) has the sole jurisdiction to deal with Sasol Gas’ conduct, including the jurisdiction to determine the maximum price of gas under the Gas Act, and that competition authorities do not have the power to investigate or determine whether Sasol Gas has engaged in excessive pricing. The Commission contended that it has the statutory power to investigate complaint it receives and to issue summons as part of its investigations.
The CAC decision confirmed that the Commission (and by extension competition authorities) have concurrent jurisdiction with Nersa over Sasol Gas’ conduct: Nersa may determine the maximum price of gas under the Gas Act, and the Commission may investigate alleged excessive pricing under the Competition Act.
Article sourced from The Competition Commission of South Africa.
See also:
- Commission prosecutes sasol gas for excessive pricing of natural gas
- Competition Commission draws up public interest guidelines on merger control
- Final Guidelines on the Exchange of Competitively Sensitive Information has been published
- The Competition Commission taking steps to level the playing field for Online Platforms
