Competition Commission raids four steel firms over suspected price-fixing
Four scrap metal buying companies suspected of price-fixing have been raided by the Competition Commission in Germiston, Nigel, Vanderbijlpark, and Hammanskraal.
Image: File
Four scrap metal buying companies suspected of price-fixing have been raided by the Competition Commission in Germiston, Nigel, Vanderbijlpark, and Hammanskraal.
According to the consumer watchdog, the raids form part of an ongoing investigation into suspected coordination of price increases on shredded and processed scrap metal, which could be in breach of South Africa’s competition laws.
"The Commission has reasonable grounds to suspect that Scaw South Africa (Pty) Ltd (“Scaw”), Cape Gate (Pty) Ltd (“Cape Gate”), Shaurya Steel (Pty) Ltd trading as Force Steels (“Force Steels”) and Unica Iron and Steel (Pty) Ltd (“Unica”) have engaged in fixing the purchase price of shredded or processed scrap metal," the watchdog said.
"It is alleged that these firms have made price adjustment announcements of the same amount for implementation at more or less same time. This conduct may amount to fixing of prices and/or trading conditions in contravention of section 4(1)(b)(i) of the Competition Act 89 of 1998, as amended (“Act”).
The Commission added that the search and seizure operations are aimed at collecting documents and electronic data relevant to the investigation.
"The search and seizure operations are being conducted as part of an ongoing investigation of a complaint lodged by a third party in 2023 and a complaint initiated by the Commissioner in February 2026. During the search, the Commission will seize documents and electronic data, which will be analysed together with other information gathered to determine whether these companies have contravened the Act".
"The companies under investigation operate as buyers of shredded or processed scrap metals, which they use in the production of long steel products".
According to the watchdog, scrap metal is part of the Commission’s priority sector of industrial intermediary products. Commissioner Doris Tshepe said dismantling any alleged price-fixing cartel in the market was critical.
“Scrap metal forms part of the industrial intermediary products, which is the Commission’s priority sector. Dismantling any alleged price-fixing cartel in the market will go a long way towards eliminating any existing 2 artificial barriers to entry and creates a conducive environment for all firms, in particular small businesses and firms owned by historically disadvantaged persons, to enter and participate in the market,”
mthobisi.nozulela@iol.co.za
IOL Business