Tribunal confirms settlement of alleged collusion by Gwalimba Construction in public sector collusive tendering case

The Competition Tribunal (“Tribunal”) has confirmed, as an order, a consent agreement between the Competition Commission (“Commission”) and Gwalimba Construction (Pty) Ltd (“Gwalimba”) concerning alleged collusive tendering, mainly in the public sector.

The case originates from a complaint submitted by the Department of Home Affairs (“DHA”) to the Commission in 2023, alleging collusive tendering by Gwalimba and Superway Construction (Pty) Ltd (“Superway”). The complaint related to a request for quotes for building repair and maintenance work, to ensure fire compliance, at the DHA’s offices at Church Square in Pretoria.

The Commission’s investigation found the firms had an arrangement not to compete on certain tenders, amounting to price fixing, market division by allocating customers and collusive tendering in contravention of section 4(1)(b) of the Competition Act (“Act”).

The Tribunal’s confirmation of the settlement follows an application brought by the Commission to have the consent agreement confirmed as a Tribunal order in terms of the Act. The Tribunal confirmed the agreement only after requesting and considering further information from the parties on the agreement reached. The Tribunal further requested the parties to include certain issues in the consent agreement, including Gwalimba’s cooperation with the Commission in its prosecution of Superway in the alleged prohibited conduct.

Gwalimba does not admit liability in respect of the alleged prohibited conduct.

Context

As context to the settlement the parties submitted that:

  • Gwalimba cooperated with the Commission’s investigation;
  • It is a small firm which has never contravened the Act before;
  • Gwalimba was not awarded the tender in question; and
  • The value of the tender at issue was small.

Settlement terms

Gwalimba has agreed to pay an administrative penalty of R50 000. In addition to paying the administrative penalty, Gwalimba has undertaken to:

  • cooperate fully with the Commission in any related proceedings;
  • refrain from engaging in prohibited collusive conduct in the future;
  • circulate a statement on the settlement to its employees, management and directors;
  • develop, implement and monitor a competition law compliance programme; and
  • submit a copy of the compliance programme to the Commission within 60 days of the Tribunal’s order.

Conclusion of proceedings

The confirmation of the consent agreement as an order of the Tribunal brings the Commission’s investigation against Gwalimba in this matter to a close.