Haste makes waste : how curtailed implementation of section 73A of the competition Act 89 of 1998 could derail the aims and policy goals of competition law in South Africa

Abstract

South Africa has joined many other jurisdictions in criminalizing cartel conduct when it legislated criminal sanctions in the form of Section 73A of the Competition Act. The section clearly differentiates between Competition Law authorities being responsible for competition law and the National Prosecution Authority being responsible for criminal prosecutions, while failing to set any specific guidance on the coordination required between the two authorities to ensure efficient prosecutions.

The Competition Commission has had years of success in the identification and dismantling of cartels, and in so doing have been able to support South Africa’s Competition Legislation which aim to promote economic efficiency, adaptability and development. Section 73A, and its lack of clarity on specifically leniency and the ability of the Competition Commission to offer immunity against prosecution, has the ability to derail the successes of the one tool with a proven track record against cartels: the Corporate Leniency Policy. The Corporate Leniency Policy is still an uncodified policy applied by the Competition Commission to entice cartelist to expose cartel conduct in exchange for leniency. A review of the co-existence of leniency programs with criminal sanctions in other jurisdictions will show that the UK and Australia have found it equally difficult to manage the cooperation between different and independent authorities responsible for competition law enforcement and criminal law enforcement respectively, and in the process have hardly criminally prosecuted any cartel conduct.

It is argued that the Corporate Leniency Policy provides effective and currently successful combat against cartels, but that the unclear and uncertain provisions of Section 73A could pose a threat to successful detection and eradication of cartels in the future, unless some expansions in a codification of the Corporate Leniency Policy is done, or specific coordination between the Competition authorities and the National Prosecuting Authority is done.