Wilmar subsidiary under investigation for possible involvement in cartel activities

by Holly Demaree
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Wilmar International confirmed that Wilmar Continental Edible Oils and Fats (Pty) Ltd  was part of an industry-wide investigation by the Competition Commission.
 
PRETORIA, SOUTH AFRICA — The Competition Commission of South Africa began conducting a search and seizure operation at the premises of five companies involved in the manufacture and distribution of refined edible oils, baking fats and margarine in South Africa. The companies operate in Gauteng and Kwazulu-Natal provinces.

The commission has reasonable grounds to suspect that Wilmar Continental Edible Oils and Fats (Pty) Ltd, DH Brothers Industries (Pty) Ltd t/a Willowton Oil and Cake Mills, FR Waring Holdings (Pty) Ltd, Africa Sun Oil Refineries (Pty) Ltd and Epic Foods (Pty) Ltd have engaged in cartel conduct that includes price-fixing in the market for the manufacture and distribution of refined edible oils, including baking fats and margarine. The alleged conduct is believed to have started before 2007 and is still on-going.

The Competition Commission is one of three, independent competition regulatory authorities established in terms of the Competition Act. The commission’s purpose is to investigate, control and evaluate restrictive business practices, abuse of dominant positions and mergers in order to achieve equity and efficiency in the South African economy.

The search and seizure operation is conducted as part of an ongoing investigation that was initiated byTembinkosi Bonakele, the commissioner of the Competition Commission. During the search the commission will seize documents, records and electronic data that will be analyzed, together with other information gathered, to determine whether these companies have contravened the Competition Act.

The commission obtained search and seizure warrants from the High Courts in Gauteng and KwaZulu-Natal, respectively, in terms of section 46 of the Competition Act. The operation is being conducted with due regard to the rights of all the affected persons.

“Food and agro-processing is an important focus area for the Competition Commission, and we are determined to root out exploitation of consumers by cartels that are so prevalent in this sector,” Bonakele said. “We have, in particular, been monitoring developments in the fats and oils markets and what we see is worrisome.”

In a statement, Wilmar International Ltd. confirmed that the Competition Commission of South Africa conducted raids at the premises of its South African subsidiary, Wilmar Continental Edible Oils and Fats (Pty) Ltd as part of an industry-wide investigation by the Competition Commission.

“Wilmar is disappointed by today’s unfortunate events but cannot comment further on any matters, which are part of the ongoing investigation,” the company said. “Wilmar takes legal compliance very seriously and adheres strictly to the principle of complying with all applicable laws, rules and regulations in the countries in which it operates. Wilmar is cooperating with all parties involved to gather information in order to assist with the investigation.”

Wilmar International Ltd. was founded in 1991 and is headquartered in Singapore. Its business activities include oil palm cultivation, oilseed crushing, edible oils refining, sugar milling and refining, manufacturing of consumer products, specialty fats, oleochemicals, biodiesel and fertilizers as well as flour and rice milling. Wilmar has more than 500 manufacturing plants and an extensive distribution network covering China, India, Indonesia and some 50 other countries. The group has a multinational workforce of about 92,000 people.
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