Tribunal finds Elliott engaged in limited instances of cover quoting in furniture removal industry

The Competition Tribunal (“Tribunal”) has found that Elliott Mobility (Pty) Ltd (“Elliott”) engaged in limited instances of cover quoting, following a complaint referral by the Competition Commission (“Commission”).  

Cover quoting is a practice whereby one or more firms agree that they will submit quotes in such a way that the designated winner will submit the lowest or most favourable quote and the other firm(s) will submit artificially high quotes so as not to win the contract.

While the Commission referred 23 alleged instances of cover quoting against Elliott, the Tribunal found sufficient evidence to sustain only seven instances – six involving cover quoting with JH Retief (Pty) Ltd (“JH Retief”) and one involving Cape Express Removals (Pty) Ltd.

Central to the Tribunal’s findings was the evidence of a former senior Elliott employee, Mr Pieterse, who held managerial roles in both Pretoria and Johannesburg. Mr Pieterse admitted to participating in cover quoting arrangements with a competitor, JH Retief, in four instances. These instances, between October 2008 and January 2010, involved the submission of cover quotes for the relocation of SANDF personnel and a Department of Health employee.

The Tribunal, in its decision, noted the broader context of widespread cover quoting practices that existed in the furniture removal industry and that Elliott’s participation was limited relative to certain other firms. For example:

  • JH Retief entered into a consent agreement with the Commission admitting to 3 487 instances of cover pricing;
  • Cape Express Removals (Pty) Ltd also settled its matter admitting to 1 774 instances; and
  • Stuttafords Van Lines (Pty) Ltd also settled, admitting it had multiple bilateral arrangements with competitors in terms of which they exchanged cover quotes in respect of 649 furniture removal tenders.

A pre-hearing will be convened in relation to remedies to discuss further submissions to be made by the parties.