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WA air conditioning cartel prosecuted : $9M penalties

The Federal Court in Perth last week handed down its final orders in the long running Western Australian air conditioning cartel case which had involved bid-rigging and price fixing on projects valued at over $100 million.

Air conditioning cartelOver the duration of the proceedings, the court has imposed a total of $9.2 million in pecuniary penalties making this the largest trade practices case ever run in Western Australia.

Projects affected included an AMP refurbishment ($9.49 million), CSIRO – Petroleum and Minerals, Bentley ($5.23m), Belmont Shopping Centre ($2.67m), UWA Electronic/Electrical Engineering ($919,800), Nickol Bay Hospital – Chillers Replacement ($568,200), Chisholm Catholic College ($654,383), Rydges Hotel Chiller ($211,000) and Murdoch University Education and Humanities ($280,510).

The cartel engaged in bid-rigging and price-fixing affecting the supply and installation of commercial and industrial air conditioning and mechanical services in WA. The ACCC began proceedings in December 2004 against 17 companies and 22 individuals.

Pecuniary penalties totalling $9,272,000 were imposed on respondents in these proceedings.

“The ACCC is pleased these proceedings have been concluded,” ACCC chairman Graeme Samuel said. “This is a timely reminder to businesses who may be tempted to engage in illegal cartel conduct that the ACCC will not hesitate to investigate and prosecute those involved in such conduct.”

“Furthermore, given recent amendments to the law, individuals who are involved in serious cartel conduct of the type subject to these proceedings now face the prospect of criminal prosecution and the risk of imprisonment for up to 10 years.”

For some periods from 1997 to June 2003 some of the respondents, who were members of the Air Conditioning and Mechanical Contractors’ Association of WA, would attend regular weekly meetings at the AMCA premises at which they would discuss upcoming tenders and endeavour to agree which tender would be designated to submit the lowest price.

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David Olsen

David Olsen

An undercover economist and a not so undercover geek. Politics, business and psychology nerd and anti-bandwagon jumper. Can be found on Twitter: <a href="http://www.twitter.com/DDsD">David Olsen - DDsD</a>

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