Woolworths and Unilever face court over price fixing cartel claims
The Australian Competition and Consumer Commission has filed civil proceedings in the Federal Court of Australia, alleging that Woolworths, Unilever, Colgate and Cussons collaborated in a price fixing cartel.
The ACCC alleges a price fixing cartel was operated
It says that the cartel denied Australian consumers the benefits of lower prices for laundry detergent products.
The actions claims that the group ceased supplying standard concentrate laundry detergents in the first quarter of 2009 and supply only ultra concentrates, transitioned their laundry detergents to ultra concentrates, sold concentrates for the same price per wash as the equivalent standard concentrated products and didn’t pass on the cost savings to consumers.
Household brands including Cold Power, Radiant and Omo were affected.
The ACCC said the arrangements “had a significant effect on competition in an industry valued at almost $500 million per annum.”
“Unilever applied for immunity under the ACCC’s Immunity Policy for Cartel Conduct. Unilever has consented to be named as the immunity applicant in this matter,” the ACCC added.
It said that a named Woolworths sales director was “knowingly concerned” in the alleged arrangements.
“Ultra concentrate detergents are cheaper to produce, store and transport. The ACCC alleges that this offered significant cost savings which, by agreement, were not passed onto consumers. These alleged arrangements also standardised the ultra-concentrate products offered, denying consumers a variety of choices on pricing, package volumes and the strength of the concentrate product,” ACCC Chairman Rod Sims said.
“By way of contrast, when similar products were launched in New Zealand, there was significant discounting, such as offering a larger pack for the price of a smaller pack. The ACCC alleges that the benefits of these competitive actions were denied to Australian consumers”.
Unilever and its relevant employees have been granted conditional immunity from legal proceedings by the ACCC after the company came forward with information about the alleged conduct.
The ACCC is seeking pecuniary penalties, declarations, injunctions, compliance programs and costs against Colgate, Cussons, Mr Ansell and Woolworths.