Cable Manufacturer Found To Have Engaged In Cartel Conduct
The Federal Court has found that Italian corporation Prysmian Cavi E Sistemi S.R.L. engaged in cartel conduct in relation to the supply of high-voltage land cables in Australia, the Australian Competition and Consumer Commission (ACCC) has today advised.
The proceedings were brought by the ACCC, with Prysmian found to have been party to an agreement with regard to a tender for the supply high-voltage land cables and accessories.
“The court found that Prysmian entered into and gave effect to agreements in breach of the price fixing and exclusionary arrangement provisions of the Trade Practices Act 1974 (now called the Competition and Consumer Act 2010),” the ACCC stated.
The agreement related to the 2003 invitation by Snowy Hydro to tender for the supply of high-voltage land cables and accessories, with the court finding Prysmian was a party to an agreement with other cable manufacturers and suppliers to “allocate” the tender to Prysmian.
The court found Prysmian then gave effect to this agreement by providing pricing guidance to its competitors, so that they could submit higher amounts, attempting to ensure Prysmian won the tender.
Justice Besanko found that this was part of a wider overarching agreement between Japanese and European cable manufacturers and suppliers, providing for the allocation of high-voltage land and submarine cable projects in various parts of the world, with projects offered for tender “allocated” to either the Japanese or European group and then to a particular company within that group.
“Pricing guidance” was then provided by that company to competitors to ensure other bids were higher, increasing the likelihood that the company allocated the project would win the tender.
“This is another example of the ACCC enforcing Australian cartel laws in relation to collusive arrangements made outside of Australia, but which have the potential to affect Australian consumers and businesses,” ACCC chairman Rod Sims commented.
The ACCC advised that a hearing on penalty and other relief sought against Prysmian by the ACCC will take place on a date to be fixed by the court.