BlueScope slapped with $57.5m penalty, held liable for conduct concerning flat steel supply
In civil cartel proceedings brought by the Australian Competition and Consumer Commission (ACCC) against BlueScope Steel Ltd, the Full Federal Court confirmed a $57.5m penalty, the country’s highest for cartel conduct or a competition law breach.
In its media release, ACCC noted that the Full Federal Court also upheld a $500,000 penalty against the former general manager of BlueScope, a major manufacturer of flat steel products in the country.
In August 2019, ACCC brought the civil cartel proceedings. It alleged that the ex-general manager and other BlueScope representatives induced eight competitors to engage in cartel conduct, potentially reducing price competition in the Australian flat steel market and raising prices for these products.
“Enforcing cartel laws is an ongoing priority for the ACCC,” said Catriona Lowe, ACCC acting chair, in the media release. “Any business or individual that attempts to enter collusive agreements with competitors risks significant penalties, even if attempts to collude and breach competition laws do not come to fruition.”
In October 2019, the ex-general manager faced charges for two counts of inciting the obstruction of a Commonwealth official by encouraging two fellow BlueScope employees to provide false information and evidence to ACCC.
The ex-general manager pleaded guilty to these charges in September 2020. He received a conviction and an eight-month imprisonment sentence. He was released on a recognizance order in December 2020.
In December 2022, the Federal Court of Australia ruled that BlueScope and its ex-general manager participated in cartel conduct connected to the supply of flat steel products in Australia.
In August 2023, the Federal Court ordered BlueScope to pay a $57.5m penalty and its ex-general manager to pay a $500,000 penalty.
The Full Federal Court dismissed BlueScope’s and its ex-general manager’s appeals of the prior Federal Court decisions.
“We are pleased that today’s Full Court decision has endorsed the findings made by the Court, and the penalties imposed,” Lowe said in ACCC’s media release. “This case involved an attempted cartel which, if successful, could have created significant damage across the economy, as well as to customers and other businesses that compete fairly.”
The Full Court affirmed that, from September 2013 to June 2014, BlueScope and its ex-general manager attempted to induce eight steel distributors in Australia and an overseas manufacturer to execute agreements fixing and raising the pricing level for flat steel products supplied in the country.
The Full Court found that the ex-general manager, on BlueScope’s behalf, approached multiple competitors and tried to induce them to enter into a contract, arrangement, or understanding with a cartel provision for distributors to use BlueScope’s pricing information as a benchmark when pricing their flat steel products.
