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South Africa’s Competition Tribunal has confirmed settlement agreements involving WesBank, FirstRand, and subsidiaries of Toyota, over allegations of uncompetitive behaviour in the country’s vehicle financing sector. The companies will pay an administrative penalty of R30 million as part of the settlement, though they have not admitted liability.
The case follows an investigation by the Competition Commission, which found that WesBank and Toyota Financial Services were involved in collusion that limited consumer choice. According to the commission, the companies entered into a shareholder agreement that effectively divided the vehicle finance market by restricting which customers WesBank could serve at authorised Toyota dealerships.
The Toyota entities involved include Toyota Financial Services South Africa, Toyota Motor Corporation, Toyota Financial Services UK PLC, and Toyota South Africa Motors. WesBank’s parent company, FirstRand, was also part of the arrangement as a shareholder.
How the collusion worked
The Commission explained that FirstRand, Toyota SA Investment Holdings Limited, and Toyota Motor Finance UK PLC each held a 33.3% stake in Toyota South Africa. Their shareholder agreement contained clauses that prohibited WesBank from financing vehicles sold at authorised Toyota dealerships, except for those sold through the McCarthy Group.
The restrictions applied to new Toyota, Lexus and Hino vehicles, as well as used cars sold at authorised Toyota dealerships. Instead, any customers who applied directly to WesBank for financing to buy these vehicles were automatically redirected to Toyota Financial Services South Africa (TFSSA), a joint venture created under the agreement.
This arrangement, the tribunal said, amounted to market division, a practice prohibited under section 4(1)(b)(ii) of South Africa’s Competition Act, because it prevented WesBank and Toyota Financial Services from competing fairly in the same market.
Why it matters
By preventing WesBank from offering financing to Toyota customers, the agreement gave buyers fewer options on where to secure loans. This kind of practice, according to competition authorities, undermines market fairness, reduces customer choice, and keeps financing costs higher than they might otherwise be.
Confirming the settlement, Competition Commissioner Doris Tshepe welcomed the outcome, stressing that the removal of such restrictions would benefit consumers.
“The removal of the restrictions that prevented WesBank from financing vehicles will give customers a wider choice when selecting vehicle financiers to finance vehicles bought from authorised Toyota dealerships,” Tshepe said.
Next steps
As part of the settlement, WesBank and Toyota will now remove all restrictions that stopped WesBank from financing vehicles sold through Toyota dealerships. This means customers can now approach WesBank directly for financing whether they are buying a new Toyota, Lexus, Hino, or a used car from any authorised Toyota dealer.
The Competition Commission said this case sends a strong message against collusive practices and shows its commitment to promoting a competitive market that prioritises consumer choice.
Industry experts say the penalty and settlement could influence how joint ventures in the automotive and financial services sectors are structured in South Africa going forward. It is also expected to encourage more transparency and competition in the vehicle financing industry, which plays a critical role in car sales.
