Comply with information powers

16 February 2005

Commerce Commission reminds industry: comply with information powers or face prosecution

Commerce Commission Chair Paula Rebstock reinforced the Commission’s strong stance on compliance with its information requisitioning powers in front of a chief executives forum in Wellington today with the announcement that the Commission is prosecuting a company and an individual for withholding documents requested as part of a Commission investigation.

Ms Rebstock confirmed the Commission has filed criminal charges in the Manukau District Court against Koppers Arch Wood Protection (NZ) Limited and its General Manager, Roy Parish. The charges related to alleged non-compliance with statutory notices under the Commerce Act that compulsorily require the production of information and documents to the Commission. The penalties for breaching section 103 of the Commerce Act are summary conviction and fines of up to $30,000 for companies and up to $10,000 for individuals.

‘The information and documents that the Commission alleges were not provided by the company or the individual potentially could be relevant evidence for a Commission investigation into alleged anti-competitive practices, including price fixing, in the wood preservatives chemicals markets,” said Ms Rebstock.

“Any failure to comply with Commission statutory notices, or any subsequent destruction of documents that forms part of a Commission investigation, is a serious enforcement issue,” she added.

Ms Rebstock highlighted the prosecution in a presentation focused on the Commission’s revised leniency policy. The Commission recently introduced its new leniency policy to counter cartel behaviour, and has since received four applications under the new policy, including one related to the investigation in both New Zealand and Australia into the corrugated cardboard box industry.

“The Commission’s new leniency policy provides immunity from Commission action to the first member of a cartel to come forward with information about the cartel and co-operate fully with the Commission on its investigation and prosecution of the cartel,” said Ms Rebstock.

“It is intended to encourage a race to be first to the Commission. The policy is designed to create a level of tension and distrust between members of a cartel, and to maximise the motivation for cartel members to come forward.”

Ms Rebstock said increasing the effectiveness of the Commission’s enforcement activity was a strategic priority for the Commission, and the leniency policy was a significant tool in achieving that.

A copy of the Commission’s enforcement policies, include leniency, co-operation and guidelines on the use of cease and desist orders, is available on the Commission’s website, www.comcom.govt.nz

ENDS

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