Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Carter Holt Harvey fined for “classic” price fixing breaches

Carter Holt Harvey fined for “classic” price fixing breaches

26 March 2014

Commerce Commission General Manager Competition, Kate Morrison says the High Court’s decision to fine Carter Holt Harvey $1.85 million for price fixing in the Auckland commercial timber market highlights the potential impact of price fixing on consumers.

A former manager of the company, Dean Dodds, has also been fined $5,000 for his involvement.

The High Court today ordered Carter Holt Harvey to pay the penalty after it entered into an understanding with Fletcher Distribution Limited, in late 2012, to fix prices for the supply of structural timber to commercial customers in Auckland. The understanding was that both parties would price MSG8 timber at cost plus an 8% margin. This was in breach of Part 2 of the Commerce Act. Justice Venning described this as a “classic case of price fixing,” but recognises this was not the most serious price fixing conduct.

The Commission became aware of the understanding in January 2013 through its cartel leniency programme, when Fletcher Distribution, operating as Placemakers, applied for leniency. The cartel ran for six months before breaking down. During that time it was applied in about 10% of the jobs priced by Carter Holt Harvey, through its building supply merchants, Carters.

Ms Morrison says price fixing harms competition and penalties such as this are a necessary deterrent.

“This case reinforces that price fixing can attract high penalties even where the commercial gains are relatively modest and the conduct continues for a relatively short period. Cartels have the potential to cause real harm to consumers by increasing prices and creating fewer choices. We are pleased that Carter Holt and Mr Dodds accepted their role in the conduct early,” said Ms Morrison.

“The Auckland market for commercial timber is an important New Zealand market. The Commission gave this case priority because of that and is pleased to have resolved it so quickly.”

Background
The Commission’s cartel leniency programme allows a party to obtain immunity from proceedings commenced by the Commission, when the party is the first to report cartel conduct to the Commission and provide assistance throughout an investigation and any enforcement action.

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Maritime: Navigation Safety Review Raises Big Issues For The Govt

Shipping Federation: "The reports makes it clear that the ratification of the Maritime Labour convention (MLC) is long overdue. Only when the MLC is ratified will Maritime NZ be able to inspect and enforce the labour conditions on international ships visiting our ports." More>>

ALSO:

100 Years After Einstein Prediction: Gravitational Waves Found

For the first time, scientists have observed ripples in the fabric of spacetime called gravitational waves, arriving at the earth from a cataclysmic event in the distant universe. This confirms a major prediction of Albert Einstein’s 1915 general theory of relativity and opens an unprecedented new window onto the cosmos. More>>

ALSO:

Farming: Alliance Plans To Start Docking Farmer Payments

Alliance Group, New Zealand's second-largest meat cooperative, plans to start withholding some stock payments to its farmers from next week to bolster its balance sheet and force suppliers to meet their share requirements. More>>

ALSO:

Gambling: SkyCity First Half Profit Rises 30%, Helped By High Rollers

SkyCity anticipates the Auckland business will benefit from government gaming concessions which were triggered on Nov. 11 in recognition of SkyCity’s $470 million Convention Centre development. Morrison said the concessions would allow the Auckland business to lift its activity during peak period, noting it had a record revenue week over the Christmas and New Year period. More>>

ALSO:

Money For Light: Kiwi Scientists Secure Preferential Access To Synchrotron

Science and Innovation Minister Steven Joyce today announced a three-year investment of $2.8 million in the Australian Synchrotron, the largest piece of scientific infrastructure in the Southern Hemisphere, to secure preferential access for Kiwi scientists. More>>

Telco Industry Report: Investment Hits $1.7 Bln A Year

Investment in the telecommunications sector is $1.7 billion a year, proportionately one of the highest levels in the OECD, according to a report released today on the status of the New Zealand sector. More>>

ALSO:

PGPs: New Programme Sets Sights On Strong Wool

A new collaboration between The New Zealand Merino Company (NZM) and the Ministry for Primary Industries (MPI), announced today, aims to deliver premiums for New Zealand's strong wool sector... More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news