ACCC v Colgate-Palmolive Pty Ltd (No 2) [2016] FCA 528: Respondents Found Guilty of Cartel Conduct
Tuesday 7 June 2016 @ 10.09 a.m. | Legal Research | Trade & Commerce
As revealed recently in an ACCC Media Release, the Federal Court has ordered Woolworths Limited (Woolworths) to pay penalties totalling $9 million for contraventions of the Trade Practices Act 1974 (now called the Competition and Consumer Act 2010) (Cth) (the Act), following admissions made by Woolworths in proceedings brought by the Australian Competition and Consumer Commission (the ACCC) in the case of ACCC v Colgate-Palmolive Pty Ltd (No 2) [2016] FCA 528.
Case Background
As revealed in our previous article, in December 2013, the ACCC commenced proceedings in the Federal Court against Colgate, Cussons, Woolworths and Mr Ansell, a former Colgate sales director.
On 28 April 2016, the Federal Court ordered that Colgate pay total penalties of $18 million for admitted contraventions of the Act, which included $12 million in penalties for making and giving effect to an understanding to limit the supply of laundry detergents. Colgate was also ordered to pay penalties of $6 million for making and giving effect to an understanding to share sensitive market information, including information about when they would increase their prices.
Mr Ansell admitted to being knowingly concerned in this conduct and by consent was disqualified from managing corporations for seven years.
The Current Action
Woolworths admitted to being knowingly concerned in the making of, and giving effect to, an understanding between Colgate-Palmolive Pty Ltd (Colgate), PZ Cussons Australia Pty Ltd (Cussons) and Unilever Australia Limited (Unilever) (who applied for immunity in this case) that they would each cease supplying standard concentrate laundry detergents to Woolworths in early 2009 and supply only ultra concentrates to Woolworths from that time.
Justice Jagot said in court that “the penalty reflects the objective seriousness of the contraventions”.
Response from the ACCC
The ACCC Chairman Rod Sims said:
“This penalty is the largest the ACCC has obtained against a party that was an accessory to competition law breaches by being knowingly concerned in anticompetitive conduct. This is a timely reminder that businesses must ensure that their competition law compliance programs educate their staff about the risks involved in communications or other conduct which facilitates an anti-competitive understanding between other businesses.”
The penalties
These penalty orders were based on admissions made by Woolworths, and joint submissions on penalty made by Woolworths and the ACCC. The Federal Court also made orders by consent that Woolworths update its trade practices compliance program and pay a contribution of $250,000 towards the ACCC’s costs in the proceedings. The ACCC is also seeking pecuniary penalties, declarations, injunctions, compliance programs and costs.
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Sources:
ACCC v Colgate-Palmolive Pty Ltd (No 2) [2016] FCA 528 (16 May 2016)
Woolworths fined $9 million for role in laundry detergent cartel – ausfoodnews.com
Woolworths ordered to pay $9 million in penalties in laundry detergent cartel proceedings – ACCC Release MR 96/16
