K-Line largely non-committal over competition charges

Only a week after the SA
Competition Commission
(CC) handed over the Japanbased
shipping company
Kawasaki Kisen Kaisha
(K-Line) to the Competition
Tribunal for prosecution, the
CC has now slapped another
10 charges on the K-Line
table.
The initial case referred to
what the CC termed “collusive
tendering, price fixing and
market division” by four lines
in a cartel transporting Toyota
vehicles by sea to and from SA
between 2002 and 2013.
Of the other three – Mitsui
OSK Lines (MOL), Nippon
Yusen Kubushiki (NYK)
and Wallenius Wilhelmsen
Logistics (WWL) – MOL got
off scot-free because it was
the whistleblower. Then, in
2015 and 2016, NYK and
WWL, along with Eukor Car
Carriers, in which WWL has
an 80% holding, settled with
the CC to the tune of R215
million in administrative
penalties. They also all
agreed to cooperate in
prosecuting K-Line.
The 10 new charges
involve the same “collusive
activities” and/or “prohibited
practices” surrounding carcarrier
transport of Toyota,
Ford, BMW, Mercedes-Benz,
Honda, Mitsubishi, Nissan
and Suzuki motor vehicles on
other sea routes to or from SA
and different dates.
The commission is seeking
administrative penalties of
10% of the company’s yearly
turnover for each of the
charges.
With the line faced with
being caught between a rock
and a hard place, and possibly
subjected to multi-million
rand administrative fines,
FTW approached K-Line’s SA
managing executive, Lance
Pullan, for comments.
But he said he was unable to
make any local statements on
the matter. However, he did
supply us with answers from
head office to a number of
questions on our list.
Unfortunately, a large
number of these answers
were: “We would like to
refrain from making any
comments in this regard” or
“K-Line is not in a position to
comment”.
However, one answer
was an explanation of CC’s
media statement that it
was prosecuting K-Line for
collusion in respect of tenders
for transportation of motor
vehicles.
“The Commission has,
since 2012, been investigating
alleged collusive conduct
in respect of the maritime
transportation of certain
motor vehicles to and from
various jurisdictions," said
the line. “K-Line has offered
complete co-operation to the
Commission throughout its
very long investigation. The
conduct that the Commission
was investigating is the same
conduct which the Japan Fair
Trade Commission, European
Commission and American
Department of Justice
previously investigated.”
As to why the CC was
only prosecuting K-Line,
the answer read: “According
to the media statement
released by the Commission,
NYK and WWL settled the
investigation against them
with the Commission during
2015 and MOL seems to be
the leniency applicant.”
It also noted that the
prosecution was aimed purely
at the line as a company, not
individuals within it.
The other questions –
Why it did not settle the
matter with the CC; whether
it intended arguing the
case in court; whether it
had engaged in collusive
practices; whether it would
pay compensation to the
motor manufacturers; or
how it felt about the potential
10% of annual turnover in
administrative penalties – all
went unanswered.