February 28, 2011
Competition Tribunal Confirms Settlement of Section 4 Complaint
JOHANNESBURG, Feb. 28, 2011 /PRNewswire/ -- The Competition Tribunal ("the Tribunal") today announced that, in terms of a consent order granted on 24 February 2011, it has confirmed the settlement agreement ("the Settlement Agreement") reached between the Competition Commission ("the Commission") and Sasol Polymers, a division of Sasol Chemical Industries Limited.
The Settlement Agreement related to Sasol Polymers' existing propylene supply contract with Safripol ("the Supply Agreement"). On 12 August 2010, the Commission referred a complaint to the Tribunal, in which it contended that the pricing provisions of the Supply Agreement gave raise to indirect price fixing between Sasol Polymers and Safripol. The pricing provisions were, however, inserted into the Supply Agreement with the knowledge of the then Competition Board in relation to the proposed merger, in 1993, of the monomer, polymer and certain other chemicals operations of Sasol and AECI Limited.
In Sasol Polymers' view, any contravention of the Competition Act (Act 89 of 1998), as amended, (the "Act") as a result of the Supply Agreement has its origins in these pricing provisions rather than any intention to contravene the Act. Given the uncertainty surrounding the legal position in relation to the pricing formula and the interpretation of section 4(1)(b) of the Act, it was considered prudent to settle with the Commission by accepting that the Supply Agreement gave rise to indirect price-fixing.
As communicated in our press release on the 14th of December 2010, in terms of this Settlement Agreement, Sasol Polymers has agreed to pay a penalty of R 111 690 000, which was subject to confirmation by the Tribunal, in full and final settlement of the Commission's allegations that the pricing formula gave rise to indirect price fixing.
Sasol Polymers and Safripol have also reached agreement on the key terms that are to govern the future monomer supply relationship between the parties, which we consider to be fully compliant from a competition law perspective. Norbert Behrens, the Group General Manager: Strategy and Planning at Sasol, said, "At Sasol we are committed to comply with all legislation and hence to resolve any competition law issues where possible. This matter is one of the outstanding competition law issues and we are pleased that this matter has now been resolved."
JSE - SOL; NYSE - SSL
Sasol Investor Relations
Tel.: +27 (0)11 441 3321 / 3563
Financial Adviser and Sponsor
Deutsche Securities (SA) (Proprietary) Limited
SOURCE Sasol Limited