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Wheels of justice have indeed ground slowly in beer case

by Amanda Visser, 15 November 2012, 15:11
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Picture: SHAUN HARRIS
Picture: SHAUN HARRIS

THE wheels of justice have turned slowly in the Big Daddy’s versus SAB spat, but a decision this week to set aside a ruling that seemed to end the hopes of the small guy has meant a decision could be ground out at last.

It will be eight years on November 25 since Nico Pitsiladi, a director of independent liquor wholesaler Big Daddy’s Group, took on SA’s biggest beer brewer before the Competition Commission about its alleged anticompetitive conduct.

The Competition Appeal Court decision this week hopefully starts the last leg of an agonising journey. The merits of the complaint will now be heard since the decision by the Competition Tribunal not to hear it any further in April last year has been overturned by the Competition Appeal Court.

The commission referred the matter to the tribunal for adjudication in 2007, but ran into difficulties when the Supreme Court of Appeal and the Competition Appeal Court’s judgments faulted the procedures it followed from the initial complaint to the final referral of its case to the tribunal.

SAB, relying on precedents created by the courts, argued that the way the commission had expanded the original complaint brought against it by Mr Pitsiladi had gone against the precedent established in the fertiliser cartel and milk cartel cases. The tribunal reluctantly agreed.

Judge Dennis Davis this week lambasted the tribunal for the way it had interpreted previous jurisprudence by his court, saying it read the judgment in the fertiliser case in isolation and therefore dealt with that judgment "as if it constituted a rupture" from the Competition Appeal Court’s earlier jurisprudence.

In the earlier jurisprudence the Competition Appeal Court stated that the allegations or the conduct in the complaint must be linked in a cognisable manner to particular prohibited conduct or practices.

Mr Pitsiladi had complained that his business did not get a discount on beer from SAB. In its referral based on the complaint, the commission brought accusations of discriminatory pricing, market allocation and establishing exclusive agreements with appointed distributors.

Judge Davis said the commission did not spell out all the relevant sections of the Competition Act which it later invoked, but it investigated the conduct complained about.

It was during that process that the complaint was "fleshed out" and it was the conduct against which Mr Pitsiladi complained which gave rise to "a series of allegations" of breaches of the act. According to the judge there was a cognisable link between the breaches and the conduct that Mr Pitsiladi complained about — namely the change in SAB’s distribution system which directly involved the brewer’s 13 appointed distributors.

Mr Pitsiladi claimed that the change in the distribution system led to him losing 30% of his business to SAB. SAB claimed Mr Pitsiladi was out of touch with his own business, and was not operating as efficiently as he could.

It is all back in the tribunal’s hands to decide who is right.

It’s been a long, arduous road and while eight years is too slow, justice also grinds fine.

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