Full Federal Court upholds Apco appeal against price fixing

The Full Federal Court today upheld the appeal of Apco Service Stations Pty Ltd against an earlier judgment that it had been part of an understanding to fix retail petrol prices in the Ballarat area and given effect to that understanding on 29 days.

The Full Court also upheld Mr Peter Anderson's appeal against the judgment that he was knowingly concerned in the Apco's conduct.
 
Apco said it was not a party to the price fixing found by Justice Merkel.  The Full Court distinguished Apco from the other parties and was not satisfied Apco's conduct demonstrated a necessary commitment by it to the pricing conduct of the other parties. It ordered that the orders and declarations made by Justice Merkel on 17 December 2004 and 17 March 2005 be set aside insofar as they affect Apco and Mr Peter Anderson.

The ACCC was also ordered to pay the appellants' costs of the appeal and the first proceedings.

The ACCC is considering the judgment to decide if an application for special leave to appeal to the High Court is appropriate. No other appeals were pursued and accordingly the Full Court's judgment in no way affects the decisions of Justices Merkel and Goldberg in respect of the remaining 14 respondents who were penalised for having made and given effect to the alleged price-fixing understanding.

Background

On 21 May 2002 the ACCC instituted proceedings against 14 companies and individuals, alleging a long-standing price-fixing arrangement existed in the market for the supply of petrol in the Ballarat region. On 20 December 2002, the Federal Court granted the ACCC leave to join two further respondents.

The ACCC alleged the companies arranged to increase prices by telephoning each other, communicating the size and approximate time of price rises and then contacting retail sites to implement the rises. The ACCC alleged when a company became aware that a service station had not raised its price, further calls were made to participants in order to have the site raise its prices. The ACCC also alleged the arrangement involved a number of meetings. Nine respondents admitted the allegations prior to the trial and had penalty hearings before Justice Goldberg.

On 17 December 2004, Justice Merkel found the seven contesting respondents engaged in price-fixing conduct in breach of section 45 of the Trade Practices Act 1974.  On 17 March 2005 Justices Merkel and Goldberg handed down penalty judgments against all the respondents, totalling $23.3 million including Apco's penalty of $3 million and Mr Anderson's of $200,000.