South Africa: Competition Tribunal

1.1.27. "Tribunal" means the Competition Tribunal of South Africa, a statutory body established in terms of section 26 of the Competition Act, with its principal piace of business at 3rd Floor, Mulayo building (Block C), the DTI Campus, 77 Meintjies Street, Sunnyside, Pretoria;

1.1.28. "Village View" means the Village View neighbourhood shopping centre situate in Bedfordview Johannesburg and which is owned by Erf 179;

1.1.29. "Win Twice" means Win Twice Properties (Proprietary) Limited, a company duly incorporated and registered in terms of the company laws of the Republic of South Africa, with its principal place of business at the Smit Road, Bedford Shopping Centre. At the time that the Bedford Centre Restraint was concluded, Win Twice was the owner of Bedford Centre;

1.1.30. "Woolworths" means Woolworths Limited, a company duly incorporated and registered in terms of the company laws of the Republic of South Africa, with its principal piace of business at 93 Longmarket Street Cape Town. Woolworths is the owner / franchisor of various retail supermarkets throughout South Africa.

The Complaint and the Commission's Investigation

2.1. During July 2009,the Commission initiated two complaints against the Respondents concerning allegations of a contravention of section 4{1)(b)(ii) of the Competition Act in relation to certain notarial deeds of restraint and a settlement agreement entered into between the Respondents pursuant to various objections lodged in relation to town planning issues, and which are more fully described below :

2.1.1. The Bedford Square Settlement Agreement, comprising a settlement agreement dated 4 November 2003 containing various terms of settlement, including that the Bedford Square Restraint is registered;

2.1.2. The Bedford Square Restraint, comprising a notarial deed of restraint registered on 12 July 2004 over the title deed of Erf 39 Bedford Gardens owned by Bedford Square Properties (i.e. Bedford Square) in favour of Liberty Group and Erf 179, which restricts Bedford Square Properties or its successors in title from leasing retail space to Woolworths and Mica for a period of 11 years; and

2.1.3. The Bedford Centre Restraint, comprising a notarial deed of restraint registered on 12 July 2004 over the title deeds of properties described as Erf 50, 51, 54 and 64 of Bedford Gardens Township (i.e. the Bedford Centre) owned by Win Twice in favour of Liberty Group and Erf 179, which restricts Win Twice from leasing retail space to Woolworths for a period of 15 years.

2.2. These complaints were initiated after the Commission had investigated and non-referred a complaint lodged by Bedford Square Properties against Liberty Group in respect of alleged contraventions of section 8(d)(i) of the Competition Act, The Commission consolidated the two complaints for purposes of its investigation in accordance with Rule 17(2) of the Commission Rules.

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The Commission's findings

3.1. The Commission's investigations established that the Bedford Square Restraint was concluded between Liberty Group, Erf 179 and Bedford Square Properties, in settlement of an objection lodged by the former two parties with the Townships Board against the LCGG's decision to approve a rezoning application brought by Bedford Square Properties to develop a mixed offering shopping centre ultimately comprising Bedford Square.

3.2. Further, the Commission found that the Bedford Centre Restraint was concluded to settle -disputes concerning; an application by Win Twice for the rezoning of the Bedford Centre so as to extend the Bedford Centre's bulk (square meterage) in a node in which, at the time, Liberty Group felt there to be an oversupply of retail space. Before such rezoning application was heard by the appropriate town planning authority, Liberty, Erf 179, BOE Bank and Win Twice entered into the Bedford Centre Settlement Agreement giving rise to the Bedford Centre Restraint

3.3. The Commission however found that although the Settlement Agreements were entered into by the Respondents in settlement of objections and negotiations regulated by town-planning legislation, a consequence of the Restraints was that they exceeded the scope of such legislation in that Liberty, Erf 179, Bedford Square Properties and Win Twice, in agreeing the terms set out in the Restraints, contravened section 4(1)(b)(ii) of the Competition Act as follows:

3.3.1. Liberty Group as owner of Eastgate, Erf 179 as owner of Village View and Bedford Square Properties as owner of Bedford Square divided markets by agreeing that Bedford Square Properties be restrained from leasing retail space to Woolworths and Mica in Bedford Square for a period of 11 years; and

3.3.2. Liberty Group as owner of Eastgate, Erf 179 as owner of Village View and Win Twice as owner of Bedford Centre divided markets by agreeing than Win Twice be restrained from leasing retail space to Woolworths in Bedford Centre for a period of 15 years.

4. Admission of Liability

Liberty Group admits that the Restraints contravened section 4(1)(b)(ii) of the Competition Act.

5. Future Conduct

5.1.1. not to divide markets by allocating customers in contravention of section 4(1)(b)(ii) of the Competition Act;

5.1.2. not to enforce the Restraints nor to require any of either Bedford Square Properties or Win Twice (or their successors in title) to abide by the Restraints;

5.1.3. to develop and implement a compliance programme, with corporate governance, designed to ensure that ail its relevant employees are aware of the provisions of the Competition Act and do not contravene them; and to submit a copy of the aforementioned compliance programme outlined above to the Commission within 90 business days of the date of confirmation of this Consent Agreement as an order of the Tribunal.

6. Administrative Penalty

6.1. In terms of section 58(1) (a) (iii), and 59(2) and (3) of the Competition Act, Liberty Group is liable to pay an administrative penalty.

6.2. The parties have agreed that Liberty Group should pay an administrative penalty of 2.5% of Liberty Group's retail property portfolio's total turnover for the financial year ended 2008, being an amount of R18 811 708.55 within thirty days of the confirmation of this Consent Agreement as an order of the Tribunal.

6.3. Liberty Group shall pay the administrative penalty into the following bank account of the Commission:

Name of Account: THE COMPETITION COMMISSION

Bank name: ABSA BANK PRETORIA

Account No: 4050778576

Branch Code: 323345

6.4. The Commission will pay the administrative penalty into the National Revenue Fund in terms
of Section 59(4) of the Competition Act.>

In the matter between:

THE COMPETITION COMMISSION Applicant

And

LIBERTY GROUP LIMITED Respondent

In re:

THE COMPETITION COMMISSION Applicant

BEDFORD SQUARE PROPERTIES (PROPRIETARY) First Respondent

LIMITED

LIBERTY GROUP LIMITED Second Respondent

ERF 179 BEDFORD VIEW (PROPRIETARY) LIMITED Third Respondent

WIN TWICE PROPERTIES (PROPRIETARY) LIMITED Fourth Respondent

ADDENDUM TO CONSENT ORDER AGREEMENT ENTERED INTO BETWEEN THE COMPETITION COMMISSION OF SOUTH AFRICA ("THE COMMISSION") AND LIBERTY GROUP LIMITED ("LIBERTY") ON 20-DECEMBER 2010 AT PRETORIA IN TERMS OF SECTION 49D READ WITH SECTION 58(1) (b) OF THE COMPETITION ACT, NO. 89 OF 1998 (AS AMENDED)

WHEREBY IT IS AGREED AS FOLLOWS:

1. In this addendum -

1.1. save as defined herein or where the context clearly indicates to the contrary, terms defined in the designated agreement shall bear the meaning ascribed to them therein when used in this addendum;

1.2. "designated agreement" means the consent order agreement entered into between the parties hereto on 20 December 2010 at Pretoria.

2. With effect from the date of last signature of this addendum, the parties agree to amend the
designated agreement as follows, namely :

2.1. By inserting a new clause 5.1.2 A after the existing clause 5.1.2 and before clause 5.1.3 -

" 5.1.2 A to engage in ail such conduct necessary, as is within its power, to partially cancel the notarial deeds of Restraint as between it, Win Twice and Bedford Square Properties. For the avoidance of doubt, Liberty hereby waives all and any right conferred upon it in terms of the notarial deeds of Restraint."

3. The designated agreement shall be amended only to the extent expressly contemplated herein and
save as specifically contemplated in this agreement, the designated agreement shall continue to be
of force and effect on the basis of its original terms and conditions.

4, This addendum constitutes the whole agreement between the parties relating to subject matter hereof.

5, No amendment or consensual cancellation of this addendum and no extension of time, waiver or
relaxation or suspension of or agreement not to enforce or to suspend or postpone the enforcement
of any of the provisions or terms of this addendum shall be binding unless recorded in a written
document signed by the parties.

6. No extension of time or waiver or relaxation of any of the provisions or terms of this addendum shall
   operate so as to preclude any party thereafter from exercising its rights strictly in accordance with
   this addendum.

Dated and signed at BRAAMFONTEIN on the 8^th day of February 2011

Melville Urdang

Director - Liberty Group Properties (Proprietary) Limited, duly authorised representative of Liberty Group Limited

Dated and signed at Pretoria on the 28^th day of February 2011

Shan Ramburuth

Commissioner: Competition Commission