Construction firms told to pay up by March

2014-01-26 14:00

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Time is running out for the members of the construction cartel that have not settled their fines with the competition commission.

This week, commissioner Tembinkosi Bonakele said he wants all settlements to be concluded by the end of March, which is the end of the commission’s financial year.

“Next financial year, we don’t want to still be talking about possible settlements. Everyone who wants to settle must settle now, because by April we are prosecuting. We want to refer the cases to the tribunal for adjudication,” he said.

As the commission settlement process winds down, the potential for civil claims against the construction firms is heating up, and the commission has issued 104 notices of prohibited collusive conduct needed to pursue a civil claim in South Africa.

Bonakele said there were probably more than 10 second-tier smaller construction companies that the commission would engage in settlement negotiations.

There were also some companies that had taken part in the fast-track settlement process that have not settled yet because of a disagreement over certain projects.

Group?5, Construction ID and Power Construction were named in June last year as companies that have not yet settled. Bonakele said the commission would be meeting with Group?5 shortly.

Group?5 was a major whistle-blower in the fast-track settlement process, but still has four cases outstanding, two of which are in dispute, according to Bonakele.

One is in connection with World Cup stadiums, where it is alleged the cartel divvied up the work.

In June last year, the commission announced settlements with 15 construction companies, which agreed to pay a total fine of R1.46?billion.

At the time, City Press reported that a further 25 still had to settle.

The commission identified collusion on 300 projects.

It said 90 had been settled, 70 still had to be settled and 140 fell outside the three-year time frame that would allow for prosecution.

This year could also see the launch of civil claims by affected parties, such as provincial governments and municipalities, as well as private players.

The commission confirmed that it had received requests from the economic development department for 64 notices that would certify certain prohibited collusive conduct and would assist in lodging civil claims.

This is on top of the 40 notices issued by the commission last year.

Numerous parties have expressed an interest in pursuing civil claims, including six municipalities, according to the SA Local Government Association.

The Black Business Council has also encouraged its members to launch civil claims against guilty construction companies.

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