Answer to Question #47412 in Economics for Jafta

Question

What is the role of the product and geographical market for ArcelorMittal- and Sasol excessive pricing cases?

Answer 1

Excessive price is a price for a good or service that bears no reasonable relation to the economic value of that good or service and is higher than that economic value.
SASOL subsidiary Sasol Chemical Industries (SCI) has been fined an administrative penalty of R534m by the Competition Tribunal for excessive pricing
The fine, for the pricing of purified propylene and polypropylene over a period of four years beginning in January 2004, could mark the end of the long-running matter. This is the first case of excessive pricing brought by the Competition Commission itself.
The first excessive pricing case was brought in 2009, when a Competition Tribunal decision over excessive pricing by steel maker ArcelorMittal was reversed by the Competition Appeal Court. In the ArcelorMittal matter, the miner settled with Harmony and Durban Roodepoort Deep, which had lodged the complaint, and the case never went back to the tribunal. The settlement — coming after the initial fine of R691.8m — was never disclosed.