JOHANNESBURG A South African legal case over exchange-rate rigging is set to drag on after the anti-trust tribunal ordered the competition watchdog on Wednesday to clarify the charges it is seeking, particularly regarding foreign banks it has no jurisdiction over.
The tribunal also dismissed a request from the banks involved to have the case dropped altogether.
In a probe that has rumbled on since 2015, the Competition Commission has been seeking to impose fines on more than a dozen local and foreign banks that it alleges colluded to coordinate activities when giving quotes to customers buying or selling currencies.
The Commission referred its case to the Competition Tribunal. But the Tribunal said on Wednesday it has sent the case back, giving the Commission 40 days to clarify the charges, partly because it has no authority over foreign lenders with no presence in South Africa.
"The Tribunal, in line with common law precedent, found that it did not have jurisdiction to issue an order requiring the foreign banks to pay any administrative penalty as such an order would not be effective," it said.
It may instead seek an order declaring the conduct of these foreign banks with no presence in South Africa to be anti-competitive, without issuing penalties to them.
With regards to foreign banks with a presence in South Africa, fines will be calculated based on the turnover of the representative unit in the country, the Tribunal said.
The foreign banks with no presence in South Africa are Bank of America Merrill Lynch (NYSE:BAC) International, JP Morgan Chase (NYSE:JPM) & Co, Australia and New Zealand Bank Ltd, Standard New York Securities Inc, Nomura International PLC, Macquarie Bank Ltd, HBC Bank USA, National Association (N.A), Merrill Lynch Pierce Fenner and Smith and Credit Suisse (SIX:CSGN) Securities (USA) LLC.
"The Tribunal found that, in both of these instances, the Commission would still need to allege that the conduct of the respondent banks had an effect in South Africa," it said.