South Africa’s Competition Commission is set to prosecute three advertising practitioners specializing in recruitment advertising services for price fixing, market division and collusive tendering.
“As the Commission we remain steadfast in our commitment to rooting out collusive and anti-competitive practices which impact negatively on South Africa’s quest towards an inclusive economy and job creation,” said the Competition Commissioner, Tembinkosi Bonakele.
The three firms link job seekers to potential employers and assist their clients to place advertisements in newspapers. They also receive and process responses to the advertisements on behalf of clients. Their main clients are government departments and municipalities.
According to the commission, the three discussed their responses to requests for quotations and decided on the price which each would tender for its services. The recruiters agreed on how to rotate advertising work amongst each other. This constitutes price fixing, market division and collusive tendering in contravention of section 4(1)(b)(i), (ii) and (iii) of the Competition Act.
In addition, an agreement to engage in collusion is presumed among the three recruiters as they had a director in common between 2006 and 2015. The Commission is of the view that the firms were engaged in horizontal restrictive practices (a relationship between competitors at the same level).
The Commission has referred the matter to the Competition Tribunal for prosecution.