Pecuniary penalties totalling $25 000 were imposed today on two businesses in the building waterproofing industry, Jaycee Rectification and Building Services Pty Ltd, its Director Mr Joaquin Ciganda, and Mr Anthony Lodge trading as Tony Lodge Group.
The Australian Competition and Consumer Commission alleged that Jaycee and Mr Lodge, competitors in the building waterproofing industry, had engaged in price fixing, market sharing, collusive tendering and misleading and deceptive conduct.
The Federal Court, Sydney, accepted a joint submission regarding injunctions and penalty for breaches of the Trade Practices Act. The joint submission took into account that both parties had been cooperative with the ACCC and were merely two players in an industry containing a large number of competitors.
The submitted penalties of $10 000 for Jaycee and $5 000 for Mr Ciganda, and $10 000 for Mr Lodge, were accepted as being appropriate in this instance.
It was alleged that each business discussed particular jobs and decided what rates to quote and who would put in the more competitive quote. They would cover each others quote on particular waterproofing projects.
A cover is where a deliberate uncompetitive quote is submitted to make another business quote look competitive. Customers were not aware that this conduct had occurred.
Users of the waterproofing services are bodies corporate, schools, hospitals and the like. The Court agreed that this conduct amounted to a breach of sections 45 (4D, 45A) and 52 of the Trade Practices Act.
The Commission cannot ignore instances of price fixing and market sharing even if the perpetrators are small business, ACCC Chairman, Professor Allan Fels said.
Price fixing and market sharing have been deemed by parliament as being inherently anti-competitive under the Trade Practices Act. Small business has obligations under the Act as well as rights.
Businesses of all sizes have to be aware that when they cover their mates when quoting for work they are breaching the Trade Practices Act. This is particularly so in the building industry where it appears to be a common practice.
