Australia's two largest chicken processors, Inghams Enterprises Pty Ltd and Steggles Ltd, today consented to maximum penalties of $250,000 each after admitting that they had made price-fixing and market-sharing agreements in the wholesale chicken meat market in South Australia.
In proceedings brought before the Federal Court in Adelaide by the Australian Competition and Consumer Commission*(ACCC), Inghams and Steggles admitted that senior SA managerial staff of both firms had organised and conducted a series of industry meetings at which the agreements were made and monitored.
ACCC Chairman, Professor Allan Fels, welcomed the maximum penalties, noting that they reflected the seriousness of price-fixing.
"The parties to the agreements accounted for over 90 per cent of wholesale chicken products supplied in SA, with Inghams and Steggles together accounting for approximately 80 per cent," he said.
"The purpose of the agreements was to fix wholesale prices in SA and to share the SA market between the wholesalers, who supplied the full range of chicken meat products to supermarkets, butchers, chicken shops and other outlets.
"The agreements were made only months before the maximum applicable penalties under the Trade Practices Act were raised from $250,000 to $10 million.
"It is possible higher penalties could have been considered but for this quirk of timing."
The ACCC alleged that Inghams and Steggles employees organised the three meetings at Adelaide's Grosvenor Hotel in late 1992 and early 1993.
In addition to the monetary penalties, both Inghams and Steggles consented to the issuing of injunctions restraining their future conduct and agreed to implement trade practices education compliance programs in their respective organisations to prevent any repetition of the illegal conduct.
Each company also consented to payment of $12,500 toward the ACCC costs in the matter.
In proceedings brought before the Federal Court in Adelaide by the Australian Competition and Consumer Commission*(ACCC), Inghams and Steggles admitted that senior SA managerial staff of both firms had organised and conducted a series of industry meetings at which the agreements were made and monitored.
ACCC Chairman, Professor Allan Fels, welcomed the maximum penalties, noting that they reflected the seriousness of price-fixing.
"The parties to the agreements accounted for over 90 per cent of wholesale chicken products supplied in SA, with Inghams and Steggles together accounting for approximately 80 per cent," he said.
"The purpose of the agreements was to fix wholesale prices in SA and to share the SA market between the wholesalers, who supplied the full range of chicken meat products to supermarkets, butchers, chicken shops and other outlets.
"The agreements were made only months before the maximum applicable penalties under the Trade Practices Act were raised from $250,000 to $10 million.
"It is possible higher penalties could have been considered but for this quirk of timing."
The ACCC alleged that Inghams and Steggles employees organised the three meetings at Adelaide's Grosvenor Hotel in late 1992 and early 1993.
In addition to the monetary penalties, both Inghams and Steggles consented to the issuing of injunctions restraining their future conduct and agreed to implement trade practices education compliance programs in their respective organisations to prevent any repetition of the illegal conduct.
Each company also consented to payment of $12,500 toward the ACCC costs in the matter.