ACCC v Colgate-Palmolive Pty Ltd (No 4)  FCA 1590: Cartel Case Dismissed
On 22 December 2017, in the case of ACCC v Colgate-Palmolive Pty Ltd (No 4)  FCA 1590, the Federal Court of Australia dismissed a cartel behaviour case originally brought in 2013 by the Australian Competition and Consumer Commission ("the ACCC") against PZ Cussons Australia ("Cussons"), regarding a suspected cartel relating to the price and supply of laundry detergent concentrates. Justice Wigney, sitting alone, dismissed the case, saying that the ACCC had not proven on the balance of probabilities that there was cartel conduct by Cussons. The case concerned, in particular, sections 44ZZRD and 44ZZRK of the Trade Practices Act 1974 (Cth).
The ACCC initiated civil proceedings against Colgate, Cussons and Woolworths in 2013, alleging that in 2009 Colgate, Cussons and Unilever entered into arrangements to only supply ultra concentrated laundry detergents to consumers for the same price per wash as the standard concentrated products, despite the fact that concentrates are cheaper to produce and store than standard concentrate detergents. For more information, read TimeBase’s earlier article. Following this action in 2016, Colgate-Palmolive Pty Ltd was fined a total of $18 million for their contraventions, which is outlined in TimeBase's previous article.
Based on admissions made by Woolworths that it was knowingly concerned in the making of and giving effect to the understanding between Colgate, Cussons and Unilever, Woolworths was found guilty of cartel conduct, and was ordered to pay penalties totalling $9 million. For more information, read Timebase’s earlier article on this. Following this, further pecuniary penalties were imposed upon Woolworths.
Federal Court’s Decision against Cussons
Justice Wigney, sitting alone in the Federal Court, dismissed the claim of the ACCC argued that the case concerned what inferences could be drawn from the primary facts rather than facts in dispute. Regarding the involvement of Cussons, Justice Wigney referred to expert evidence to find that the behaviour of the suppliers in question was an economically rational response to underlying market forces rather than any collusive explicit agreement or contract:
Justice Wigney found that the ACCC had failed to prove on the balance of probabilities that the suppliers had explicitly entered into a collusive arrangement, rather finding that it was more likely that the actions were in response to economic forces. He stated:
Response to Decision
Chairman of ACCC, Rod Sims:
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Australian Competition and Consumer Commission v Colgate-Palmolive Pty Ltd (No 4)  FCA 1590
[media release] ACCC, ‘,’ 22 December 2017.