South Africa- Competition Commission conducts third dawn raid this year

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Ending off a year of numerous dawn raids, the Commission announced yesterday in a press statement that it had conducted a search and seizure / dawn raid operation at the offices of InvestChem (Pty) Ltd (“InvestChem”) and Akulu Marchon (Pty) Ltd (“Akulu Marchon”) in Kempton Park, Johannesburg. The firms manufacture and supply a range of surfactant products. Surfactants may act as detergents, wetting agents, emulsifiers, foaming agents, dishwashing liquids, soaps, car cleaning products and dispersants.
InvestChem is the South African subsidiary of Inchem Holdings Ltd, which is a Bermuda-based company which has other subsidiaries based in the USA and Portugal. InvestChem develops, manufactures and supplies a range of surfactant products which are used in the detergent and toiletry industries.
Akulu Marchon, which is one of the businesses of AECI Chemicals, supplies chemical raw materials for cosmetics, toiletry and detergent products in Southern Africa. These products include petroleum jelly and white mineral oils for the South African ethnic skin and hair care markets, locally produced and imported specialty surfactants for household, personal care products and chemical specialties for the personal care and cosmetic industries.
The Commission indicated that the dawn raid formed part of the Commission’s ongoing investigation into collusive conduct in the market for the production and supply of a range of surfactants products used as input materials in the manufacture of blended household detergents, cosmetics and toiletry products.
According to the Commission, from 2003, the parties held meetings and agreed to fix the prices for surfactants and allocated customers between each other which is prohibited by the South African Competition Act and the Commission understands the alleged conduct is currently ongoing.
The Commissioner, Tembinkosi Bonakele stated the following in relation to the dawn raid, “I believe that the information that will be obtained from today’s operation will enable the Commission to determine whether or not the parties have indeed engaged in collusive conduct. However, as part of any investigation, we also wish to urge anyone, be it business or individuals with further information to come forward and assist the Commission in concluding this investigation”.
Following a four year dawn raid “drought”, the Commission had conducted a dawn raid in July 2014 at the offices of Precision and Sons (“Precision”), Eldan Auto Body (“Eldan”) in Pretoria West, as well as the Vehicle Accident Assessment Centre (“VAAC”) in Centurion. Precision and Eldan’s business activities include panel beating, spray painting and towing of vehicles and they are approved auto body repairers to Original Equipment Manufacturers. In April 2014, the Commission conducted a dawn raid at the offices of Unilever South Africa (Pty) Ltd and Sime Darby’s respective South African offices, in relation to the Commission’s investigation into alleged collusive conduct in the product markets for the manufacture and supply of edible oils and baking fats to both wholesale and retail customers.

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