Competition Commission confirms R101 million settlement with Sunfoil over price-fixing allegations

In a landmark resolution marking the end of an eight-year protracted legal battle, the Competition Tribunal has confirmed a R101-million settlement agreement with Willowton Group, the owner of the Sunfoil cooking oil brand. 

The settlement stems from an investigation that commenced in 2016, targeting the company behind well-known brands such as Romi, D'lite, and Sunshine D. This inquiry scrutinised allegations of collusion with other edible oil producers to manipulate prices.

The companies include Wilmar Continental Edible Oils and Fats (Pty) Ltd, FR Waring Holdings (Pty) Ltd, Africa Sun Oil Refineries (Pty) Ltd, Epic Foods (Pty) Ltd, Sea Lake Investments (Pty) Ltd and Unity Food Products (Pty) Ltd.

Investigations are still ongoing against the other companies except for one company, FR Waring Holdings (Pty) Ltd.

The companies allegedly agreed on price increases for edible oils, including baking fats and margarine as well as the timing for such increases. The conduct is alleged to have been in place as far back as 2007.

Under the terms of the agreement, Willowton Group will pay R1 million as part of the settlement, in addition to a commitment of R100 million allocated for public interest initiatives over the next five years, which includes a bursary fund of R20 million during the same period.

This significant commitment aims to promote social upliftment through educational bursaries and to provide food and grocery support to various non-governmental organisations. Furthermore, it encompasses the procurement of services from empowered service providers, addressing the critical need for economic inclusivity

In addition, the Willowton Group will make donations of food products and groceries to registered non-governmental and non-profit organisations that cater to historically disadvantaged people to the amount of R30 million over five years.

"Non-governmental and non-profit organisations will be able to find information on how to submit applications for the donation in a national newspaper, electronic media or social media platform within the next 30 days," read the statement.

While the prolonged litigation ultimately strained resources and incurred costs on both sides, the Commission deemed the settlement a pragmatic approach to bring closure to the drawn-out case.

In reaching this settlement, the Willowton Group withdrew its review application in the North Gauteng High Court in Pretoria where the company wanted to set aside of the Commission’s warrant to search and seize evidence from their premises.

The application review was still to be heard when the Commission and the Willowton Group agreed on the settlement.

sinenhlanhla.masilela@iol.co.za

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