ACCC commences legal proceedings against Yazaki Corporation and Australian Arrow Pty Ltd for alleged cartel conduct

13 December 2012

The Australian Competition and Consumer Commission has instituted civil proceedings in the Adelaide Registry of the Federal Court of Australia against Yazaki Corporation, a Japanese company, and its Australian subsidiary, Australian Arrow Pty Ltd.

The ACCC alleges that Yazaki and Australian Arrow engaged in cartel conduct, market sharing and price fixing, in relation to the supply of wire harnesses to Toyota Motor Corporation and its related entities in Australia. Wire harnesses are electrical systems that facilitate the distribution of power and the sending of electrical signals to various components of a motor vehicle.

“The ACCC has recently put particular focus on cartels, starting with its short film ‘The Marker’ which I sent to the chief executives of Australia’s top 300 companies. This put the business community on notice that cartel activity would not be tolerated. In August we instituted proceedings against Renegade Gas Pty Ltd and Speed-E Gas (NSW) Pty Ltd alleging their involvement in a Sydney forklift gas supply cartel,” ACCC Chairman Rod Sims said.

“Today we are announcing the institution of proceedings against Yazaki Corporation and its Australian subsidiary Australian Arrow Pty Ltd where we allege they engaged in cartel conduct when supplying Toyota.

“Cartel conduct is inherently anti-competitive and potentially impacts Australian consumers by ultimately raising the cost of products they purchase”.

The ACCC alleges that between 2003 and at least late 2009, Yazaki and Australian Arrow made and gave effect to cartel arrangements with a competitor involving coordination of their responses to requests for quotations issued by Toyota Motor Corporation for the supply of wire harnesses to be used in the manufacture of the Toyota Camry.

In particular, the ACCC alleges that there was an overarching cartel arrangement between Yazaki and a competitor which remained operative until at least late 2009 to meet in relation to requests for quotations received from automotive manufacturers, to agree on the allocation of wire harnesses to be supplied by each of them (or their subsidiaries) to the manufacturer, and to exchange and agree on the prices they would submit to the manufacturer.

It is also alleged that Australian Arrow and Yazaki made and gave effect to agreements of this type in relation to the supply of wire harnesses for use in the manufacture of the 2006 and 2011 models of the Toyota Camry, and that Australian Arrow engaged in cartel conduct in relation to harnesses to be used in manufacturing the 2002 model Camry.

The ACCC alleges that this conduct by Yazaki and Australian Arrow contravened sections 45 and 44ZZRK (in relation to conduct from 24 July 2009) of the Competition and Consumer Act 2010.

The ACCC is seeking pecuniary penalties, declarations, injunctions and costs.

The ACCC’s action follows similar enforcement action against Yazaki and other cartel participants by competition regulators in the US and Japan which involved the supply of wire harnesses and other automotive components to a number of automobile manufacturers.

A directions hearing has been set down for 10 January 2013 at 9.15am before Justice Besanko in the Federal Court, Adelaide.

Release number: 
NR 263/12
Media enquiries: 
Mr Duncan Harrod - (02) 6243 1108 or 0408 995 408