BlueScope has been ordered to pay a $57.5 million penalty for attempting to fix prices for flat steel products supplied in Australia.
The penalty ordered by the Federal Court is the highest penalty ever imposed for cartel conduct in Australia.
The Court also imposed a $575,000 penalty on BlueScope’s former general manager, Jason Ellis, a University of Wollongong graduate.
In December 2022, the Court found that BlueScope and Mr Ellis had attempted to induce eight steel distributors in Australia, and an overseas manufacturer, Yieh Phui, to enter agreements to fix and/or raise the level of pricing for flat steel products.
In handing down the fine, Justice Michael O’Bryan found that the conduct by BlueScope was deliberate and systematic and considered that “only a substantial penalty for each of the attempts to induce cartel conduct will serve the objectives of specific and general deterrence”.
He found that the conduct by BlueScope was of a serious kind, was carried out at a senior level of the company, had the potential to occasion significant loss and damage and to deliver substantial financial gain to BlueScope.
“The conduct in the present case warrants a significant penalty to deter repetition by Mr Ellis and by others who may otherwise calculate that the rewards from such conduct outweigh the risks of detection,” he said.
“It is important that the deterrent effect of the penalty being imposed is not undermined by the ability of company directors and officers to insure against the financial cost of the penalty.”
ACCC Commissioner Liza Carver welcomed the penalty and said it should serve as a strong warning to all businesses and individuals that attempting to fix prices with competitors would have very serious consequences, “even if the attempt fails and they do not reach an agreement”.
“It is important that penalties are sufficiently large to deter even large companies and their employees from breaching Australia’s competition laws.
“Cartel conduct is illegal because it cheats Australians by increasing the prices consumers and business customers have to pay, and by restricting healthy economic growth.
“If BlueScope had been successful in reaching an agreement to fix prices with its competitors, this would have reduced price competition and increased prices for flat steel products which are widely used in the construction, manufacturing, automotive and transport industries.”
The previous highest cartel penalty imposed by the Federal Court was a $46 million penalty against Yazaki Corporation in May 2018.
BlueScope and Ellis were also ordered to pay the ACCC’s costs.