Sasol to pay R534 mln penalty for overcharging domestic customers for purified propylene, PP

09-Jun-14

Sasol has been ordered by the competition tribunal to pay a R534 mln penalty for overcharging domestic customers between January 2004 and December 2007. It was found that SCI, a subsidiary of Sasol had charged Safripol -- a customer and downstream competitor -- prices for purified propylene that had inhibited Safripol's ability to compete with SCI. Downstream competition occurs when two companies sell similar finished products for sale but differ in the production or manufacture process.The tribunal also found that SCI's locally charged polypropylene prices had had a harmful effect on local plastic converters. The tribunal imposed a penalty of R205.2m in the case of purified propylene and R328.8m in respect of polypropylene. The tribunal also imposed guidelines to ensure that SCI in future lowered the price it was charging local customers for the two products.The hearing relating to SCI began in May last year after the competition commission lodged a complaint against the company.