Commission refers firms to Tribunal for cartel conduct in sale of boerewors, beef patties

The Competition Commission announced on Monday that it had referred two beef processing companies - Irvin & Johnson and Karan Beef – to the Competition Tribunal for cartel conduct.

“The two companies have been charged with dividing markets in the supply of processed beef products such as beef burger patties, steak sizzlers, crumbed beef steaklets, viennas and boerewors,” the commission said in a statement. 

The Commission is a statutory body that investigates uncompetitive behaviour, while the Competition Tribunal adjudicates cases and hears appeals.

This referral follows an investigation that dates from September 2017 against the two firms.  

“The Commission’s investigation found that from 2000 until recently, Karan Beef and I&J entered into a manufacturing agreement in terms of which Karen Beef will stop producing certain processed beef products for its own account and produce on behalf of I&J. The agreement further entailed that Karan Beef should not sell certain of its processed beef products to certain customers which were reserved for I&J.” 

The Commission said that Karan Beef had admitted guilt and paid an administrative penalty of R2.7m. The commission has asked the tribunal to impose an administrative penalty of 10% of I&J’s annual turnover. 

The Public Investment Corporation and Pelo Agricultural Ventures announced little less than a week ago that it was set to aquire a majority shareholding in Karan Beef for up to R5.2bn.

*Correction: An earlier headline of this article said the Competition Commission found the firms guilty. This is incorrect. The Commission referred the firms to the Competition Tribunal, which adjudicates cases. The headline was changed at 15:15. 

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