Paper suppliers to pay $4 million for fixing prices
The Federal Court has ordered APRIL Fine Paper Trading Pte Ltd, a Singapore company, and a related company, APRIL International Marketing Services Australia Pty Ltd, to pay penalties totalling $4 million for breaching the price fixing provisions of the Trade Practices Act 1974 and Competition Codes.
"This matter sends a strong message that the ACCC will pursue alleged cartel arrangements made overseas by foreign corporations that affect Australian prices and consumers, in this case for a basic commodity like copy paper," Australian Competition and Consumer Commission chairman Graeme Samuel said.
After the two companies agreed to admit certain facts for the purposes of the proceedings, the court ordered APRIL Fine Paper Trading to pay $3,250,000 for its involvement in fixing the price of copy paper and uncoated woodfree folio paper supplied to Australian customers. APRIL International Marketing Services Australia will pay $750,000 in penalties for its ancillary involvement.
In joint submissions to the court the ACCC and the two companies, APRIL Fine Paper Trading admitted that it had taken part in 18 meetings with competitors at what was referred to as the AAA Club*, between December 2000 and January 2004. At the meetings, APRIL Fine Paper Trading made arrangements or understandings with competitors about the average price of paper sold, and it was alleged that the company gave effect to these arrangements in its Australian pricing.
Justice Bennett noted in her judgment the following facts, amongst others, agreed by the ACCC and the two companies:
the "conduct at AAA Club meetings was an arrangement which arose in circumstances where the participants were seeking to achieve stability in pricing by avoiding competition amongst themselves"
the conduct was "deliberate", and
"the AAA Club meetings were held in secret."
Justice Bennett also noted that the penalties were significantly discounted, due to the cooperation of the two APRIL companies.
The court also ordered, by consent of the APRIL parties:
injunctions to restrain both companies from engaging in similar conduct, and
that the two companies contribute $250,000 towards the ACCC's costs in the proceedings.
Proceedings continue against other parties in the Federal Court.
