Referral by Competition Commission of Polymers Industry Investigation to Competition Tribunal for Adjudication

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Aug 12, 2010, 09:10 ET

JOHANNESBURG, Aug. 12 /PRNewswire-FirstCall/ -- As previously disclosed by Sasol Limited (NYSE: SSL; JSE: SOL) as part of its ongoing disclosures, the South African Competition Commission has been investigating the South African polymers industry. The Competition Commission announced today that it has referred its findings to the Competition Tribunal for adjudication.

In its announcement the Competition Commission stated that it has referred complaints of collusion and excessive pricing in the polymers market against Sasol Chemical Industries Limited (SCI) and Safripol (Pty) Limited (Safripol) to the Competition Tribunal for adjudication. It also announced that it has simultaneously reached a settlement with Safripol in which Safripol admits that the supply agreement between SCI and Safripol and its implementation amounted to price fixing in contravention of the Competition Act. The Competition Commission has indicated that it is seeking an administrative penalty of 10% of SCI's annual turnover for each of these alleged contraventions.

The Competition Commission's allegation of collusion relates to an agreement of the Sasol Polymers division of SCI with Safripol, which was structured at the behest of the former Competition Board following the formation of Polifin (the Sasol / AECI joint venture) in 1994. The agreement was structured to ensure Safripol's ongoing access to propylene supply at a market-related price.

South African propylene and polypropylene prices are comparable to international prices and hence Sasol believes that there is no legitimate basis for the Competition Commission's excessive pricing allegations.

Sasol Polymers has been liaising with the Competition Commission in its investigation. SCI has not yet received the referral mentioned in the Competition Commission's announcement.

Given SCI's interactions with the Competition Commission and knowledge of this matter, SCI does not believe that it has breached any competition laws. Accordingly, at this time, there is no reasonable certainty as to whether or not SCI will be found to have contravened competition laws as alleged, whether a penalty will be imposed and the quantum thereof. SCI intends defending the matter before the Competition Tribunal should an amicable resolution of the matter not be achieved.

Investor Relations Team

+27 11 441 3321 / 3563

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SOURCE Sasol Limited