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South African Iron and Steel Institute

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Guideline on competition of the South African Iron and Steel Institute

South Africa and most nations, through anti-trust/competition laws, impose constraints on the conduct of market participants. Violation of these laws can result in civil and criminal penalties, both for the companies and the individuals involved. Agreements to fix prices, limit production or divide markets are typical of the activities that violate anti-trust/competition laws. Many anti-trust/competition laws apply also to other anti-competitive practices such as abuse of a dominant position, and the exchange among competitors of sensitive proprietary information relating, for example, to current production costs or non-public strategic plans. In some cases a violation can be found if there is an effect on commerce in a country, even though the offending conduct took place outside that country.

However, it is recognised that not all co-operation among competitors is bad and that indeed some such activities such as research and development into the end uses of iron and steel, governmental lobbying, setting neutral industry standards, and exchanges of information on safety and environmental standards are pro-competitive.

The South African Iron and Steel Institute (SAISI) is a pro-competitive industry association. SAISI’s members are committed to compliance with the Competition Act (Act 89 of 1998). SAISI activities must not serve as an opportunity for improper conduct among two or more of its members, whether during SAISI meetings or during related social events.

The following rules apply to each Institute meeting to minimise potential liability under competition laws:

  1. Agendas. A detailed agenda must be prepared for each SAISI meeting or any of its committees or sub-committees and circulated in advance to participants. Agendas must be reviewed in advance of circulation by legal counsel for competition law implications. Discussions at meetings must be confined to the topics on the agenda.
  2. Informal Meetings. While it is recognised that lunches, dinners and like social functions may precede or follow Institute meetings, members must be aware that these guidelines apply during such functions. Competition law violations occurring at social functions carry the same legal impact as those occurring at formal meetings.
  3. Prohibited Topics. The following are examples of topics of discussion that must be avoided at all SAISI meetings and other functions:
  • past, current or future prices of individual producers;
  • what constitutes a “fair” profit level;
  • elements of price, costs or methods of constructing prices;
  • discounts, credit terms or other conditions of sales;
  • individual company’s market shares or the allocation of markets or customers;
  • refusals to deal with any supplier or customer;
  • confidential individual company statistical data or competitive plans or forecasts.