Murray & Roberts CE Henry Laas
Photo by: Duane Daws
Construction and engineering group Murray & Roberts said on Thursday that it had made financial provision for another possible penalty from the Competition Commission, following on from the settlement of 17 cases of collusive behaviour earlier this year.
The commission in June imposed a collective R1.46-billion in penalties on 15 companies in the industry for collusive tendering related to projects concluded between 2006 and 2011.
Murray & Roberts CE Henry Laas said in Johannesburg that he did not want to quantify the provision made, as it might prejudice the case against the construction group.
Two of the cases were in the steel sector, two in companies that Murray & Roberts acquired, and one in Botswana. However, Laas noted that the group did not believe the commission had jurisdiction in Botswana, while it was also convinced that this specific matter was already settled under the 17 incidents already resolved.
He said the Competition Commission had refused to include the five cases in the fast-track process, as it had already started investigating these incidents prior to the start of the fast-track process.
Murray & Roberts was fined R309-million, to be paid across three years, under the fast-track process, with the first payment of R103-million already made.
Laas said the infringements under the fast-track process, all at companies Murray & Roberts acquired, happened from 2004 to 2007. Roughly half of the incidents happened before the group acquired the companies, and the remainder following acquisition.
Laas said the six executives implicated in the infringements had already left the group.
“This entire Competition Commission process was quite embarrassing for Murray & Roberts and for me as a person.”
One of Murray & Roberts’ remedies to the problem of fraud and collusion was to ensure that management, Laas included, sign an ethical declaration following each tender submission.
Laas said there existed a threat of potential civil claims still to be levelled against Murray & Roberts and other South African construction companies following the Competition Commission investigation. However, he regarded the risk to the group as “not so big”, as he did not believe Murray & Roberts had a big exposure to the projects involved.