Bridgestone South Africa comments on ‘unlawful’ power disconnection

Bridgestone South Africa has voiced its support for the legal action undertaken by the Brits Industrialists Association (BIA) against the Local Municipality of Madibeng. The BIA has launched a claim for damages against the municipality on behalf of its members after their electricity supply was unlawfully disconnected. Bridgestone states that its Brits tyre plant was one of the factories affected.

The Brits tyre production facility, which employs more than 800 people, was shut down from midday on Friday 13 January until early in the evening on 16 January after the municipality defied a court interdict preventing it from cutting the factory’s power. “Bridgestone South Africa was one of the applicants in the BIA case in which an interim interdict was successfully obtained in 2014 challenging Madibeng’s electricity tariff increases pending a court review,” commented Gavin Young, chief executive officer of Bridgestone’s operation in South Africa. “Until the review is heard, Bridgestone’s electricity tariff is the figure determined by the court in the interdict.”

Young said that by cutting off electricity supply to the members of the BIA, the Madibeng Municipality directly violated the conditions of the 2014 court order. “On January 16 2017, an urgent application for contempt of court was brought by the members of the BIA in the North Gauteng High Court in Pretoria,” he explained. “The judge in the matter found in favour of the BIA and issued an order directing the municipality to restore electricity by 18:00 that evening.” Young added that Bridgestone had paid all amounts due for its electricity consumption at the tariff set by the court, adding: “This cut-off unlawfully prevented us from conducting our business.”

The Bridgestone South Africa chief executive officer opined that Madibeng Municipality should have been more sensitive to the impact of its actions on the broader community, with Bridgestone employees being the breadwinners for thousands of residents in the area. “Madibeng’s unlawful power cut-offs placed livelihoods in jeopardy and had the potential to harm our standing with Bridgestone’s Japanese parent company.” Young continued: “It is essential for investor confidence that arms of government operate within the law.”

Young said Bridgestone had not ruled out further legal action against Madibeng Municipality to recover the costs of the shutdown and lost productivity. “Now that the plant has been re-started, we will begin to quantify our commercial losses, and our executive team will be taking legal advice on the relief available to us,” he concluded.