Case  CCT175/20
[2021] ZACC 09

Hearing Date: 23 February 2021  

Judgement Date: 13 April 2021

Post Judgment Media Summary  

The following explanatory note is provided to assist the media in reporting this case and is not binding on the Constitutional Court or any member of the Court.

On 13 May 2021 at 09h00 the Constitutional Court handed down judgment in an application for leave to appeal against the whole judgment and orders of the Competition Appeal Court and the Competition Tribunal that dismissed the appeal and application for reinstatement of a complaint that the Competition Commission withdrew.

The Competition Commission initiated a complaint against the respondents in terms of section 49B(1) of the Competition Act 89 of 1998 (the Act). The Commission alleged that the respondents entered into a contract that amounted to a division of markets or an allocation of customers, which allegedly contravened section 4(1)(b)(ii) of the Act. The matter was set down for hearing before the Tribunal and a week prior to the hearing, the Commission informed the legal representatives of the respondents that it wished to engage in settlement negotiations. The Commission accordingly filed a notice of withdrawal to give settlement negotiations a fair chance. The Competition Tribunal informed the parties that the matter had been removed from the roll and stated that should the Commission wish to reinstate the complaint in the future, it had to file an application for reinstatement.

The settlement negotiations did not occur and the Commission filed its application for reinstatement. The respondents opposed the application and argued that the Commission was barred from referring the complaint because the proceedings before the Tribunal were “complete” in terms of section 67(2) of the Act. The respondents also argued that neither the Act nor the Tribunal rules empowered the Tribunal to reinstate a withdrawn complaint. The Tribunal found that the Commission’s withdrawal did not merely amount to a removal of the matter from the Tribunal roll, but that it was in fact a withdrawal of the case against the respondents. The Tribunal held that it was possible for the Commission to reinstate a withdrawn complaint. However, the Tribunal refused the application for reinstatement as it found that a proper case for reinstatement was not made out.

The Commission appealed to the Competition Appeal Court against the refusal of the application for reinstatement and, argued that the proceedings were not “completed” in terms of section 67(2) of the Act. The Competition Appeal Court held that the withdrawal of a complaint amounted to completed proceedings and the Commission was prohibited from reinstating the same complaint before the Tribunal. The appeal was subsequently dismissed.

In the Constitutional Court the Commission argued that the Competition Appeal Court erred in holding that the withdrawal of a complaint amounted to completed proceedings. It further argued that the provisions of section 50 of the Act affords it the power to reinstate a withdrawn complained and that it has unfettered power to refer a valid complaint to the Tribunal.

The first respondent argued that the Commission sought to obtain a unilateral unopposed postponement by withdrawing the complaint before the Tribunal and that it could have reinstated the complaint on the same day that the purported settlement negotiations collapsed. The second respondent argued that the withdrawal of the complaint amounted to proceedings being “completed” before the Tribunal.

In a unanimous judgment penned by Jafta J concurred in by (Mogoeng CJ, Khampepe J, Madlanga J, Majiedt J, Mhlantla J, Pillay AJ, Theron J, Tlaletsi AJ and Tshiqi J), the Constitutional Court established that the main issue that arose for determination was the proper meaning of section 67(2) of the Act. The Constitutional Court held that the proper meaning of section 67(2) is that a withdrawn complaint does not constitute “completed proceedings”. It interpreted the words “completed proceedings” to mean finalised proceedings in that the Tribunal disposed of the issues relating to the merits of the complaint..

 

The Full judgment  here