The stage is set for a tense trial at the Competition Tribunal, where the Competition Commission will have to defend its decision to prosecute 18 foreign and local banking entities for collusion in the face of robust challenges from 14 of those entities.

The commission referred the case to the tribunal in February. The banks are accused of fixing prices and dividing markets in the rand-dollar trading market between 2007 and 2013. The case involves arcane issues involving currency traders in New York allegedly agreeing in Bloomberg chatrooms to collude to fix bid-offer spreads and the like.

The banks include entities as far removed from SA as the Australia and New Zealand Banking Group and at least half of them are neither registered banks nor authorised foreign exchange dealers in SA. One of the banks, Citi, which does have a South African banking licence and is an authorised dealer, has already reached a R70m settlement with the commission, which the tribunal has approved. Another group, Absa-Barclays, has applied for leniency.

That its research appears so shoddy can only fuel speculation

But the rest are not going along with the commission at all. Fourteen have filed exception applications. And in affidavit after affidavit, a disturbing picture emerges of just how flimsy the commission’s case seems to be. Investec indicated it did not even know how to plead since it could not tell from the commission’s "vague and embarrassing" referral affidavit what case it was being called on to meet. The commission provided sweeping generalisations but no specifics on when, how, or with whom collusion took place, said the affidavit.

Nor was Investec the only bank to call the commission’s referral "vague and embarrassing". Bank of America Merrill Lynch said the same, as did others who made the point that the commission hadn’t offered any specific evidence to show why or whether they were involved, and had failed to disclose the basic facts that it had relied on for its case, which, as one bank put it, was "devoid of details".

Several of the banks will be challenging whether SA’s competition authorities have jurisdiction in a case that involves currency traders in New York. Quite a few say that the commission never informed them that it was investigating a potential collusion case, nor did it ever ask them for documents, clarification or comment prior to the referral in February.

Of course, lawyers and their clients would say these things when they are trying to defend themselves against allegations of collusion. But the commission’s case this time appears to be particularly open to accusations that it just hasn’t done its work properly.

What’s really disturbing is what appears to be a lack of any rigour on a case that is so politically explosive. The collusion allegations against the banks fit remarkably neatly into the antibusiness, "white monopoly capital" narrative that those supporting President Jacob Zuma have been putting about, fuelled by Gupta-linked public relations hacks.

The commission should be rigorous in every case it prosecutes. But one would have thought that in one as politically sensitive as this, it would have gone out of its way to ensure it had a watertight case against each and every one of the banks it cited. That its research appears so shoddy can only fuel damaging speculation that it bowed to political pressure in launching this case — and that is not good for the institution.

More often than not, companies accused of collusion have settled with the commission. The banks case looks to be one of the rare cases in which most of the accused have decided to fight it out. That is welcome.

This case needs to be aired thoroughly in the glare of publicity that the tribunal hearing will no doubt ensure. It should be an interesting battle, and an important one.

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