Rooibos's Monopoly Ended in 1993. It Had a Private Sequel

This Ministry has already set down how rooibos spent forty years under a single legal buyer. The Rooibos Tea Control Board held that position by law from 1954 until its 1993 dissolution into a public company, later renamed Rooibos Limited (the full account is filed here). What this entry adds, gently, is the part the record leaves for last: in 2017, South Africa's Competition Commission accused that same successor company of doing, by contract, something that read uncomfortably close to what the old law used to do by decree. It matters to whoever is holding this cup, because the fewer hands a crop passes through on its way to a tin, the fewer places a grower, or a rival brand, has to turn.

What the Commission said Rooibos Limited was doing

The complaint reached the Commission in 2015, from Khoisan Tea, a rival rooibos processor. It described a pattern the Commission's own investigation then dated to 2014: Rooibos Limited signing long-term supply agreements with commercial farmers in the Cederberg, agreements that committed up to half of a farmer's rooibos production to Rooibos Limited alone, for a term running several years. A second lever tightened the same grip. Rooibos Limited ran its own production research, the kind of agronomy work a grower genuinely wants a hand with, and made access to it conditional on the same commitment: sign over a share of the harvest, and the research findings followed.

Neither practice is unusual on its own, and this Ministry will not pretend otherwise. Long supply contracts and research-for-loyalty arrangements exist across South African agriculture without becoming a competition case. What made this one different was scale. By the Commission's own account, Rooibos Limited controlled somewhere between 60 and 70 percent of the rooibos-processing market, estimates vary slightly by source, against a field the Centre for Competition, Regulation and Economic Development puts at roughly eight large processors and several hundred registered farmers. A dominant firm signing exclusive-leaning contracts is not automatically unlawful under South African competition law. A dominant firm using that position to foreclose rivals from the raw material they need to compete at all is a different question, and it is the one the Commission chose to ask, on behalf of every smaller buyer, and every reader's second-favourite tin, that a locked-up harvest leaves standing at the fence line.

The charge, and the company's answer

On 19 June 2017, the Commission's deputy commissioner, Hardin Ratshisusu, referred the matter to the Competition Tribunal for a formal hearing, stating plainly that "dominant firms have a special responsibility to ensure they do not stifle competition." The referral asked the Tribunal for a finding that Rooibos Limited had contravened the Competition Act's prohibition on abuse of dominance, and for an administrative penalty of up to 10 percent of the company's annual turnover, a figure with real teeth against an industry Bizcommunity reported as moving on the order of 15 million kilograms (about 33 million pounds) of rooibos a year, industry-wide, not a single company's own count.

Rooibos Limited's managing director at the time, Martin Berg, answered the charge in public and without hedging: "We do not think we are guilty of these allegations at all. We plan on getting legal advice and defending ourselves." Days later, the SA Rooibos Council, the industry's own representative body, offered its own limited word in the company's favour, that Rooibos Limited remained "a member of good standing" with no history of breaching the Council's code of conduct, while declining to engage the substance of the Commission's case on the grounds that the matter was before the Tribunal. A grower reading the papers that week would have found the two sides agreeing on almost nothing except that the matter was serious.

That distinction matters, and it is worth stating exactly, since a headline that summer read further than the record supported: the Commission had referred a charge, not secured a finding. Referral is the regulator building a case for a tribunal to weigh, the competition-law equivalent of a prosecutor filing an indictment. Nothing had yet been proven, and nothing ever was, in the sense of a tribunal ruling on the merits.

How it ended, in November 2020

The case did not go to a full hearing. It closed instead the way a substantial share of South African competition cases close, in a consent agreement, confirmed by the Tribunal in November 2020, more than three years after the referral and five years after Khoisan Tea's original complaint. Rooibos Limited conceded no liability. No administrative penalty changed hands, not the 10 percent of turnover the Commission had originally sought, not any lesser figure. What Rooibos Limited agreed to instead was forward-looking and specific: any future long-term supply agreement with a farmer would run no longer than five years, no contract would restrict a farmer from also dealing with a rival processor, and the results of any production research the company commissioned would be published openly on its website within five days, with no strings attached to access it.

Set beside the site's own record of what came before it, the terms read like a direct answer to the old complaint. The 1954 law gave one board the sole legal right to buy and sell rooibos, a monopoly this Ministry has already recorded as the reason wild-harvesting families could not legally sell tea their own hands had gathered (that fuller history sits here). Deregulation in 1993 never replaced that board with an open market; this Ministry has separately recorded that no rooibos auction has ever existed, before or since (the full accounting is here). The five-year cap and the ban on exclusivity clauses do the one thing an auction never arrived to do on its own: they give a Cederberg farmer, by law now rather than by hope, a standing chance to sell part of a season's harvest to whichever buyer, Rooibos Limited or a smaller rival, actually offers the better deal.

What the case does, and does not, prove

None of this rewrites what actually happened. Rooibos Limited was never found guilty of anything a tribunal weighed and ruled on; it settled a referral, on terms that let it deny wrongdoing to the end. Long-term supply contracts are not, by themselves, a monopoly; the Commission's own case rested specifically on Rooibos Limited's dominant share of the processing market, a condition that does not describe every buyer a farmer might sign with. And the settlement's own terms, a hard cap on contract length and open publication of research, are the kind of concession that would be pointless to extract from a company genuinely doing nothing wrong.

What the record does show, cleanly and on multiple independent accounts, is a regulator that looked at how the rooibos market concentrated after the state stepped back, found a private company holding a majority of it, found that company's own contracts running in the direction of lock-in rather than away from it, and spent five years pressing the question before both sides agreed to stop asking it in public. None of it changes what is in the tin on the shelf today. What it changes, on paper at least, is how long a farmer can be asked to promise it to one buyer alone, and that is the kind of small print, patiently pressed for over five years by people this Ministry has never met, that decides whether a second name ever gets the chance to appear on a rooibos label next to the first.