The Competition Tribunal has dismissed Gogga Tracking's request to force a Vodacom subsidiary to drop its pricing.
The small Internet reseller asked the tribunal to force Vodacom Service Provider (VSP) to sell it data at its retail rate, or 19c per MB, instead of the 60c per MB it was paying. Gogga argued that VSP abused its dominance by increasing its data costs, putting Gogga's margins under pressure.
However, the tribunal says Gogga cannot litigate against VSP, because Vodacom Ventures - another Vodacom subsidiary - has a 49% stake in the company. The shareholders' agreement prevents litigation, unless the shareholders approve it.
In a written decision by tribunal member Lawrence Reyburn, the competition body says the case was struck off the roll because Gogga's shareholders' agreement prevents Gogga from engaging in litigation without consent of both shareholders.
Gogga is a data retailer targeting the market for data packages smaller than 500MB and a customer of VSP, which sells wholesale and retail data, and competes with Gogga in the retail market.
Still fighting
Gogga MD Eugene Beetge says, however, that the company is not dropping the issue, and intends taking Vodacom to task for allegedly abusing its dominance. “We will not back off.”
Beetge says the company is meeting with its lawyers today to see if there is a way the shareholders' agreement can be amended so that Gogga can once again institute legal action against Vodacom for abusive behaviour.
“As a director of the company, my first priority is to protect shareholders of the company, which ironically includes Vodacom,” he says. Beetge represents Gogga's other shareholder, the Somnium Family Trust, which holds 51% of the company.
Vodacom was not immediately available to comment this morning. However, in its submission to the competition authorities, the operator says the matter is not a competition issue, but a case of Gogga not paying its accounts and claiming anti-competitive behaviour.
Beetge denies Gogga owes Vodacom any money, saying Gogga refused to pay its bills when Vodacom increased pricing by 2 000%.
Vodacom also said Gogga was never prevented from buying wholesale products from other licensed network suppliers such as Telkom, Neotel, Sentech, iBurst, MTN and Cell C.
Related story:
Vodacom prepares for 'Gogga' case
Share
