The Competition Commission has insisted that its application to the Constitutional Court for leave to appeal the decision by the Competition Appeal Court (CAC) dismantling its case against 18 major banks was to seek clarity in the litigation of similar cases in future. File: Reuters
The Competition Commission has insisted that its application to the Constitutional Court for leave to appeal the decision by the Competition Appeal Court (CAC) dismantling its case against 18 major banks was to seek clarity in the litigation of similar cases in future.
This is as Commissioner Doris Tshepe came under a barrage of questions from DA MP Dean Macpherson on the competency of the Competition Commission in handling the litigation of the banks, which he said went as far as indicting people not working in organisations they were cited as being involved with.
“There is a saying that when you are in a hole you should stop digging. Why is the Commission appealing the CAC judgment when every legal advice points to it not going ahead with the appeal?” Macpherson charged.
The CAC in January upheld an appeal by the majority of the respondent banks accused by the Commission of price-fixing.
The appeal was upheld on the grounds that the Commission lacked the necessary jurisdiction as well as a lack of evidence. Four respondent banks who did not escape the order to file their answering affidavits were BNP Paribas, JPMorgan Chase and Co, HSBC Bank Plc and Credit Suisse Securities (USA) LLC.
Barclays Bank Plc and Barclays Bank with Absa applied for and got leniency from the Commission for telling on the other banks, while CitiBank and Standard Chartered settled with the Commission, paying penalties of more than R112 million. Three banks have also applied to appeal the CAC ruling at the Constitutional Court.
Giving an update on the investigation into the matter, Tshepe said the litigation had been protracted as the banks had also filed interlocutory applications along the way.
The matter dates back to 2015 against 28 banks, including the big local banks and many other international banks, alleging that these groups colluded with each other to fix the foreign exchange rate in respect of the US dollar and the South African rand currency.
Tshepe said the Commission now sought clarity from the Constitutional Court on the jurisdiction of a national competition authority like itself faced against global cartels.
She said the Commission also sought clarity on when an entity like itself could introduce evidence against suspected institutions, whether at the point of leading evidence in building up its case or during trial.
“We believe it is necessary to get clarity from the highest court in the land,” Tshepe said, pointing out that the turnaround on the matter rested with the Constitutional Court deciding when to hear it.
Macpherson said the CAC judgment indicated that the Commission had tried to prosecute banks that had nothing to do with the currency fixing, accusing the entity of admitting by itself that it had no identity of the FirstRand traders cited in the charge report.
“In the case of Standard Bank, the Commission hanged its entire case on the basis of a conversation between one trader from there and another from Barclays, even the judge said the case would not get off the starting blocks,” Macpherson said.
“The Commission has filed a great conspiracy case against the banks. The question is why. This is an embarrassment to the Commission, the credibility of its workers, the government and everyone. Where do you get your legal advice?”
The Commission insisted that it was not making up the case, but that the banks had a case to answer as it had set out facts the banks needed to respond to.
In dismissing the matter, the CAC said the onus was on the commission to show a common anti-competitive objective by all the banks, that is, that each firm had made an intentional contribution by its own conduct to the common objectives pursued by all of the participants.
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