Eight major milk producers in South Africa will next week appear before the country’s competition watchdog on charges of price-fixing and freezing smaller milk processors and distributors out of the market.
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The case comes only months after bread producers were fined millions of rand under the same charges.
The eight dairy firms, Clover Industries, Clover SA, Parmalat, Ladismith Cheese, Woodlands, Lancewood, Nestle SA and Milkwood Dairy, could face fines of up to 10% of their operating profit.
The investigation, which began in February 2005, accused industry players of “price-fixing in raw and retail milk” and that “trading conditions were manipulated in these markets”.
“This arrangement enabled colluding firms to maintain the price of milk at artificially high levels,” South Africa’s Competition Commission has claimed.
Clover, Parmalat, Woodlands and Nestle also allegedly agreed to sell surplus milk to each other instead of selling this stock off at lower prices to consumers.
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By GlobalDataOf the price-fixing allegations, deputy chief executive for Clover, Manie Roode, told the local press: “You will find there is a huge price difference in our products, with Clover products more expensive in some cases.”
Pick ‘n Pay CEO Nick Badminton has denied allegations of his company’s involvement in price-fixing and pledged to continue the fight against collusion.
The tribunal pre-hearing is expected to take place on 7 February.
