Watchdog bites chunk out of cable cartel
The competition watchdog has secured a $1.3 million fine against Japanese company Viscas for price fixing and bid rigging in a tender to supply the Snowy Hydro Project with electrical cables.
The Australian Competition and Consumer Commission found that Viscas and other electrical cable suppliers - including Japanese companies JPS and Exsym Corporation, and European companies Prysmian and Nexans - had an "understanding" that allowed certain companies to win international tenders.
Viscas and the ACCC have reached a court-approved settlement in which Viscas will pay the Commonwealth a $1.3 million fine and agree to be restrained from entering any price-fixing arrangements for three years. The remaining proceedings against it will be dismissed.
Viscas also agreed to pay $50,000 of the ACCC's legal costs.
The Federal Court in Adelaide heard that "the European suppliers would decide between themselves who would submit the lowest price" and that "this arrangement arose out of an overarching arrangement in relation to the allocation of projects involving those Japanese and European suppliers of land cables".
In the end, Snowy Hydro granted the contract to an outside party, Midland Metals.
"This is yet another example of the ACCC obtaining a substantial penalty in relation to alleged cartel conduct," ACCC chairman Rod Sims said.
"Cartels damage the economy, often raising prices for local businesses and consumers and hurting those businesses that play by the rules. It is crucial for the ACCC to continue to tackle cartel conduct, whether Australian or foreign based, with the full force of the law."
In his judgment Justice Bruce Lander noted: "The conduct complained of was very serious. It involved a deliberate course of conduct by engaging in anti-competitive behaviour at the expense of customers in that market. Although no actual damage was caused to Snowy Hydro, but for the tender of the non-collusive party, Midland Metals, Snowy Hydro could have suffered significant damage."