Watchdog fines Pioneer R195 mln

2010-02-04 00:00

THE Competition Tribunal yesterday imposed a penalty of R195 718 614 on food giant Pioneer for its role in a bread cartel and has ordered the group to desist from such conduct in future.

The cartel involved the four primary bakeries Tiger (Albany), Premier (Blue Ribbon), Foodcorp (Sunbake) and Pioneer, which owns Sasko and Duens bakeries.

Together, the four bakeries enjoy a market share of between 50% to 60% of the bread market in South Africa, according to a Competition Commission statement.

The case concerns two complaint referrals brought against Pioneer of a bread cartel operating in the Western Cape and a bread cartel operating in the inland region.

In 2007, Premier Foods sought leniency from the commission for its role in the cartel.

Tiger and Foodcorp subsequently negotiated agreements with the commission in which they agreed to pay fines. Pioneer opted to fight the case before the tribunal.

“The administrative penalty of R195 million amounts to 10% of Sasko’s national 2006 bread turnover,” the statement read.

“The Competition Commission asked the tribunal to impose a penalty of 10% of Pioneer’s total group turnover, not only on its baking division, for each complaint.”

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