On 10 February 2020, the Competition Commission of South Africa (“Commission”) referred a complaint to the Competition Tribunal which was lodged by several inter-provincial/long-distance bus operators against the Passenger Rail Agency of South Africa (“PRASA”) and Autopax Passenger Services SOC Limited (“Autopax”).

The complaint related to anti-competitive conduct which PRASA engaged in respect of Autopax and which resulted in competition distortion in the interprovincial/long-distance bus service market. The Commission found that PRASA is abusing its dominant position in the inter-provincial bus service market in the following ways:

• charging excessive prices through its pay-on-use system to interprovincial/long distance bus operators at the Johannesburg Park Station; and
• refusing and/or restricting rivals of Autopax access to the Johannesburg Park Station

PRASA provides integrated transport solutions through commuter rail, inter-city, long-distance rail and road based inter-provincial/long-distance bus services, as it controls key intermodal terminal facilities. PRASA is owned by the South African Government and was established to transform the public transport system in South Africa into a vibrant and efficient system and further, to be a gateway to accessible socio-economic opportunities for South Africans.

Autopax is a wholly owned subsidiary of PRASA which provides road based inter-provincial/long-distance bus services within, to and from the borders of South Africa and operates 2 (two) bus services namely, Translux and City-to-City.

The inter-provincial/long-distance bus service market is a crucial market for many South Africans in the rural areas as they rely on the inter-provincial/long-distance bus service to access urban areas and to move between cities for socio-economic opportunities. In fact, the Commission identified the land based public passenger transport sector as an important sector and is currently conducting a market inquiry to understand the general state of competition within the sector.

The purpose of the market inquiry is also to identify features or a combination of features in the land based public passenger transport sector that may prevent, distort and/or restrict competition within the sector. The Commission is expected to release its provisional report in respect of the market inquiry on 19 February 2020.

Of importance is that the inter-provincial operating licence requires long-distance bus operators to secure access to terminal facilities. As such, the inter-provincial/long-distance bus operators namely, Autopax, Unitrans Passenger Proprietary Limited, Intercape Ferreira Mainliner Proprietary Limited, David Bus Services Proprietary Limited trading as Eldo Coaches, Africa People Mover Proprietary Limited and Moollas Transport Services CC, require access to terminal facilities in order to operate their respective businesses.

PRASA owns the intermodal terminal facility at the Johannesburg Park Station, which is strategically located between the central business district and Braamfontein and thereby gives access to inter-provincial/long-distance bus service to many commuters. In or around December 2013, PRASA introduced and implemented the pay-on-use system in terms of which it charged inter-provincial/long-distance bus operators R450.00 (four hundred and fifty rand) excluding VAT, per hour per bus for access to the loading bays at the Johannesburg Park Station.

Furthermore, if inter-provincial/long-distance bus operators exceed the time period allotted to them by PRASA for access on account of the fee they pay, PRASA charges a penalty fee of R150.00 (one hundred and fifty rand) for every 15 (fifteen) minutes exceeded.

Subsequent to the investigation of the complaint, the Commission found the following:

• The bus access fee charged by PRASA was excessive
• PRASA’s pay-on-use system has substantially increased the costs of inter-provincial/long-distance bus services
• PRASA allocates a large exclusive area to Autopax at the Johannesburg Park Station and Autopax does not utilise the excess loading bays
• PRASA does not provide access to loading bays at the Johannesburg Park Station to several inter-provincial bus operators who applied for access to the Johannesburg Park Station; and
• When interprovincial bus service operators default on payment, PRASA evicts the inter-provincial bus service operators but does not enforce the same principle against Autopax

Accordingly, the Commission found that PRASA abused its dominant position as a provider of the only intermodal terminal facility at the Johannesburg Park Station. The detrimental consequences of PRASA’s anti-competitive conduct are far reaching. The increased costs incurred by the inter-provincial/long-distance bus operators will be passed down to commuters or the inter-provincial/long-distance bus operators will exit the market or gradually squeezed out of the market and be excluded from participating in the economy whilst PRASA continues to thrive and abuse its dominant position through Autopax.

PRASA’s shareholder, the South African Department of Transport, should be concerned about PRASA’s anti-competitive conduct as it is responsible for funding it. Consequently, the Commission is seeking an administration penalty against PRASA of 10% (ten percent) of its annual turnover and an order directing it to cease the abuse.

By Pamela Bodlo