Altech welcomes court decision
Craig Venter, Altech Group CEO, has welcomed a Constitutional Court’s decision to dismiss the application for leave to appeal by the Competition Commission of South Africa and Tracetec against Altech Netstar and others.
In 2005, Tracetec lodged a complaint with the Competition Commission against Altech Netstar, Matrix Vehicle Tracking and Tracker, alleging that the three companies, which together enjoyed over 90% of the stolen vehicle recovery market at that time, were forcing competitors out of the market.
In its finding the Constitutional Court indicated that it had considered the application for leave to appeal and had concluded that the application should be dismissed as there were no prospects of success. As such, it issued an order that the application for leave to appeal be dismissed with costs.
“This has been a long and protracted battle despite rulings by the Competition Appeal Court of South Africa and the Supreme Court of Appeal of South Africa in favour of Altech Netstar and others. We are delighted that this matter has finally been put to rest,” Venter said.
Tracetec alleged that the three companies, through the Vehicle Security Association of SA (VESA), contravened the Competition Act by setting standards for VESA membership and accreditation that created barriers to entry as newcomers to the industry could not satisfy the set standards. Tracetec argued it had not been able to become VESA accredited, which meant it could not grow its business because of the fundamental importance insurers attached to such accreditation.
In April 2010, the Competition Tribunal found that the three companies were preventing competition in the industry and denying consumers lower prices. Altech Netstar disagreed with the finding and approached the Competition Appeal Court which found, in February 2011, that the grounds of the complaint were unfounded and overturned the Competition Tribunal decision.
The Competition Commission and Tracetec subsequently brought an application for leave to appeal to the Competition Appeal Court in March 2011, which both parties withdrew in December 2011, shortly before the scheduled hearing date, based on the argument that the Competition Appeal Court lacked jurisdiction in the matter. A fresh application for leave to appeal by both parties was then brought to the Supreme Court of Appeal (also in December 2011) which was subsequently dismissed in March 2012.
The Competition Commission then approached the Constitutional Court of South Africa in a last ditch attempt to have the Supreme Court of Appeal’s finding overturned.
“The performance standards adopted by VESA and applied by insurance companies ensured that consumers were protected against ‘fly-by-night’ operators in the vehicle tracking and recovery industry. The favourable ruling by the Constitutional Court of South Africa is a victory for both Altech Netstar and consumers,” concluded Venter.
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