Sasol's Antitrust Fine Tops R250 Million

PETROCHEMICALS group Sasol's record R188m fine has been increased to just more than R250,7m after it uncovered more anticompetitive behaviour in its Sasol Nitro division.

The fine, imposed by the Competition Commission two weeks ago, was a result of a settlement after Sasol owned up to collusion in an effort to put to rest an investigation into cartel conduct in its chemicals business that has been going on since 2002.

The fine is Sasol's latest brush with competition authorities. It is appealing against a R3,7bn fine the European Commission imposed on it last year for its role in a cartel in Europe's wax market. That was the biggest antitrust fine imposed on a South African company.

Sasol said yesterday that following interviews with employees and former employees it had uncovered additional evidence of collusion.

The new information emerged during Sasol's internal review of its compliance with competition law.

Sasol said employees and former employees interviewed had not disclosed all the information on collusion.

The additional information prompted Sasol to seek an amendment to the settlement with the commission, which resulted in the bigger fine.

"The information changed the commission's view of the nature and seriousness of one of the matters covered by the settlement agreement," Sasol said.

Sasol spokeswoman Jacqui O'Sullivan would not give details yesterday of the nature and details of new evidence Sasol uncovered.

The commission said the additional information included meetings between Sasol Nitro, Omnia and Yara (formerly Kynoch) "to fix prices and agree discounts".

The increased fine comes on the eve of today's Competition Tribunal hearings on the commission's fine, which the tribunal must confirm.

Sasol CE Pat Davies, chairwoman Hixonia Nyasulu and MD of the Sasol Nitro business Marius Brand will make submissions at today's hearings.

Details of the new evidence that Sasol has uncovered are likely to come up at the hearings.

The commission has been investigating Sasol and its competitors in the fertiliser market, Omnia and Yara, for collusion and abuse of dominance.

The body has also been investigating allegations of collusion between Sasol and fertiliser company Foskor on the supply of phosphoric acid.

Two weeks ago, the commission and Sasol agreed on a R188m settlement for the collusion.

The new fine is 8% of turnover of the Sasol Nitro business. The previous fine was 6% of that company's turnover. The commission said it increased the fine because Sasol made the new disclosure "late in the day".

It encouraged timeous and full disclosure, said the commission.

"The Competition Commission hopes to encourage early and substantive co-operation.

"While it is commendable that Sasol's ongoing internal review has uncovered conduct substantiating our findings, this conduct should have been uncovered when the commission initiated its investigation five years ago and certainly prior to the settlement agreement signed earlier this month," commissioner Shan Ramburuth said yesterday.

Although invited to do so, the two companies that laid complaints against Sasol, Nutri-Flo and Profert, this week said they would not make submissions.

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