ACCC v Prysmian Cavi E Sistemi S.R.L. (No 13) (FCA)

Federal Court of Australia
Justice Besanko

ACCC v Prysmian Cavi E Sistemi S.R.L. (No 13) [2017] FCA 851 (28 July 2017)

This is the penalty judgment flowing from the liability judgment: ACCC v Prysmian Cavi E Sistemi S.R.L. (No 12) [2016] FCA 822 (20 July 2016)

An appeal by Prysmian failed in the Full Court and Special Leave to appeal to the High Court was refused.

Catchwords

TRADE PRACTICES – consideration of an application seeking declarations and an injunction against the Respondent – where terms of the declaration are restricted to one particular agreement – where appropriate case for declarations of contravening conduct – whether the Court should exercise its power to grant an injunction against the Respondent – where contravening conduct was giving effect to a significant cartel arrangement – where conduct occurred some time ago.

TRADE PRACTICES – consideration of s 76 of the Competition and Consumer Act 2010 (Act) and the appropriate penalty or penalties in respect of contraventions – where contravener engaged in cartel conducted related to the supply of land-based electrical cables, submarine-based electrical cables and accessories – determination of maximum penalty – whether maximum penalty will properly reflect the gravity and seriousness of the contravening conduct.

TRADE PRACTICES – consideration of how many contraventions are subject to the maximum penalty – whether contraventions are to be considered part of the same conduct within s 76(3) of the Act – where the Respondent’s conduct reflects a single course of conduct between the cartel participants.

TRADE PRACTICES – consideration of the parity principle and the penalty imposed on another respondent – where Court should have regard to the penalty imposed – where circumstances are such that a close approximation with the penalty imposed is not required or appropriate.

PRACTICE AND PROCEDURE – where contravening conduct was deliberate and premeditated – where the conduct occurred over a relatively short period of time – where Respondent did not secure the contract – where Respondent has not been found guilty of similar conduct before or since the contravening conduct – where Respondent is a large global group with substantial market shares – where conduct engaged in by senior employees of the company – where Respondent has shown no contrition for the contravening conduct and has not cooperated in any relevant sense.

COSTS – consideration of an application by the Second Respondent seeking costs against the Applicant pursuant to r 25.14(2) of the Federal Court Rules 2011 (Cth) – where the Applicant did not act unreasonably in rejecting the Second Respondent’s offer – where the case was complex and the question of attribution may turn on quite fine factual distinctions.

Legislation

Competition and Consumer Act 2010 (Cth) ss 6A, 45, 76, 80

Evidence Act 1995 (Cth) s 191

Federal Court of Australia Act 1976 (Cth) 21

Federal Court Rules 1979 (Cth) O 23 r 11

Federal Court Rules 2011 (Cth) rr 25.14; 40.04

In brief

In 2009 the ACCC brought action against three parties; Prysmian Cavi E Sistemi SRL (Prysmian), Nexans SA and Viscas Corporation. It alleged market sharing and price fixing (effectively in the form of bid rigging) between September and October 2003 in contravention of s 45(2) of the TPA (now the CCA; the relevant conduct occurred prior to introduction of the new cartel laws).

In particular, the ACCC alleged that four companies - Prysmian, Nexans SA, Viscas and J-Power Systems (JPS - whistleblower and received immunity from prosecution) - engaged in cartel conduct in the markets for land cables and submarine cables worldwide in the form of bid rigging and market allocation.

Viscas admitted liability, Prysmian was found to have engaged in price fixing and the claim against Nexans was dismissed. This is the penalty judgment flowing form the Prysmian liability judgment.

Prysmian appealed the decision in August 2017 and, on 13 March 2018, the Full Federal Court dismissed the appeal.

Prysmian (the Italian company)

In July 2016 Justice Besanco held that Prysmian had contravened the prohibition against price fixing (then contained in s 45 of the Act with the aid of a deeming provision in s 45A), but not the prohibition against exclusionary provisions (primary boycotts).

Nexans SA (the French company)

In July 2016 Justice Besanco dismissed the claim against Nexans SA, holding that the ACCC had not established that Nexans SA was a party to a contravening agreement.

Viscas Corporation (the Japanese company)

In 2013 Viscas, the third respondent, admitted it had engaged in the relevant conduct and received a penalty of $1.35million (ACCC v Prysmian Cavi E Sistemi Energia SRL (No 5) [2013] FCA 294 (5 April 2013)).

ACCC Media releases

ACCC, ‘High Court refuses leave for electrical cable cartel appeal’ (8 August 2018)

ACCC, 'Full Federal Court dismisses cartel appeal' (13 March 2018)

ACCC, 'Federal Court finds cable manufacturer engaged in cartel conduct' (21 July 2016)

ACCC, 'Japanese cable supplier to pay $1.35 million penalty for cartel conduct' (5 April 2013)

Other commentary

Charmaine Lam, 'You Win Some, You Lose Some' (In Competition, King&Wood Mallesons, 11 August 2016)

Related Judgments

Special leave

Appeal to Full Court

On the penalty (Prysmian)