FEDERAL COURT OF AUSTRALIA

Australian Competition & Consumer Commission v

Tyco Australia Pty Ltd ACN 008 399 004

[2000] FCA 832

TRADE PRACTICES - penalty and injunctive relief imposed for breach of s 45 Trade Practices Act 1974 (Cth) where breach acknowledged by respondents and joint submissions lodged

Trade Practices Act 1974 (Cth), s 45

AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v TYCO AUSTRALIA PTY LTD (formerly Wormald Australia Pty Ltd) T/as Wormald Fire Systems ACN 008 399 004 AND ORS

Q 239 OF 1999

DRUMMOND J

13 JUNE 2000

BRISBANE

THE COURT DIRECTS THAT:

1.                  On or before 16 June 2000, the applicant serve on all respondents who have not filed a joint submission with the Court all affidavits of other respondents that have been filed and served on the applicant since 3 May 2000.

2.                  The eighth, twenty-sixth, thirty-fourth, thirty-fifth, thirty-sixth and thirty-seventh respondents file and serve their defences on or before 20 June 2000.

3.                  On or before 4 July 2000 the applicant file and serve any replies.

4.                  The applicant and the third respondent exchange proposed categories of documents for discovery on or before 27 June 2000 and shall endeavour to agree on such categories by 10 July 2000.

5.                  In the event that discovery categories are agreed by 10 July 2000, the applicant and the third respondent shall exchange verified lists of documents by 10 August 2000.

6.                  In the event that discovery categories are not agreed by 10 July 2000, the parties shall have liberty to apply to re-list the matter for determination of discovery categories and further orders.

7.                  On or before 17 July 2000 the applicant and any further respondents proposing to put submissions jointly with the applicant to the Court as to the pecuniary penalty that ought to be imposed on them and all other orders to be made to finalise the matter with respect to them shall file their joint submissions and any affidavits to be relied upon at the hearing.

8.                  On or before 17 July 2000 the applicant and the fourteenth and forty-eighth respondents file an agreed statement of facts and minutes of proposed orders such that the only matter in issue between them is the quantum of penalty to be recommended to the Court.

9.                  On 5 October 2000 the matter be set down for hearing as against all respondents which have filed joint submissions in accordance with Order 7 and as against the fourteenth and forty-eighth respondents (should an agreed statement of facts and minutes of proposed orders be filed in accordance with the preceding order).

10.              The matter be relisted for further directions at 9.30 am on 17 August 2000.

11.              The costs of today’s directions hearing, save as specifically ordered, be the parties’ costs in the cause.

AND THE COURT FURTHER DIRECTS THAT:

12.              The proceedings as between the cross-claimant and cross-respondents be adjourned to 9.30 am on 17 August 2000.

13.              The costs of today’s directions hearing as between the cross-claimant and cross-respondents be the parties’ costs in the cause.

THE COURT NOTES THAT:

14. The fourth respondent has given, and the applicant has accepted, an undertaking pursuant to s 87B the Trade Practices Act 1974 (Cth) to implement and maintain for a period of five years a trade practices compliance program.

THE COURT ORDERS THAT:

15A. In respect of its contraventions of ss 45(2)(a)(ii) and 45(2)(b)(ii) the Trade Practices Act 1974 (Cth), and of its ancillary involvement in contraventions of those sections, alleged in paragraph 125 of the statement of claim, a penalty in respect of all contraventions which occurred after 30 September 1993 of $750,000 be imposed upon the fourth respondent.

15B. In respect of his ancillary involvement in the contraventions by the fourth respondent of ss 45(2)(a)(ii) and 45(2)(b)(ii) the Trade Practices Act 1974 (Cth) alleged in paragraph 148 of the statement of claim, a penalty in respect of all contraventions which occurred after 30 September 1993 of $100,000 be imposed upon the twenty-seventh respondent.

15C. In respect of his ancillary involvement in the contraventions by the fourth respondent of ss 45(2)(a)(ii) and 45(2)(b)(ii) the Trade Practices Act 1974 (Cth) alleged in paragraph 149 of the statement of claim, a penalty in respect of all contraventions which occurred after 30 September 1993 of $10,000 be imposed upon the twenty-eighth respondent.

15D. In respect of his ancillary involvement in the contraventions by the fourth respondent of ss 45(2)(a)(ii) and 45(2)(b)(ii) the Trade Practices Act 1974 (Cth) alleged in paragraph 150 of the statement of claim, a penalty in respect of all contraventions of $15,000 be imposed upon the twenty-ninth respondent.

15E. The penalty of the fourth respondent is to be paid to the Commonwealth of Australia as follows:

(a)                the sum of $105,000 within fourteen days of the date of this order;

(b)               the further sum of $215,000 on or before 21 January 2001;

(c)                the further sum of $215,000 on or before 21 January 2002;

(d)               the further sum of $215,000 on or before 21 January 2003;

(e)                if any instalment is not paid on or before the due date then the entire balance of the penalty of $750,000 then unpaid becomes immediately due and payable.

15F. The penalties of each of the twenty-seventh, twenty-eighth and twenty-ninth respondents are to be paid to the Commonwealth of Australia within fourteendays of the date of this order.

THE COURT FURTHER ORDERS BY CONSENT OF THE APPLICANT AND THE FOURTH, TWENTY-SEVENTH, TWENTY-EIGHTH AND TWENTY-NINTH RESPONDENTS THAT:

16A. The fourth respondent be restrained, in Queensland and the Northern Territory, for a period of three years, whether by its directors, servants, agents, or otherwise howsoever, from making, arriving at or giving effect to any contract or arrangement or understanding (other than an agreement to jointly tender for the provision of the services referred to in subparagraph (a) hereof; an agreement with a related entity; or an agreement in so far as it relates to the licensing or assignment of a trademark, patent, registered design, copyright or EL rights within the meaning of the Circuits Layouts Act 1989 (Cth)) which contains a provision that:

(a)                has the purpose or effect or likely effect, whether by itself or together with another provision of any contract, arrangement or understanding to which the fourth respondent is a party, that:

(i)                  the fourth respondent will not compete with another provider of fire sprinkler system installation services for the provision of those services to a particular person or class of persons; or

(ii)                the fourth respondent will allow another provider of fire sprinkler system installation services to win any tender let by a third person for the provision of such services; or

(iii)               another provider of fire sprinkler system installation services will allow the fourth respondent to win any tender let by a third person for the provision of such services; or

(b)               has the purpose or effect or likely effect of fixing, controlling or maintaining or providing for the fixing, controlling or maintaining of, the prices charged for fire sprinkler system installation services supplied or offered for supply by any of the parties to the contract, arrangement or understanding in competition with one another to other persons.

16B. The fourth respondent be restrained, in Queensland and the Northern Territory, for a period of three years, whether by its directors, servants, agents or otherwise howsoever, from making, arriving at or giving effect to any contract or arrangement or understanding (other than an agreement to jointly tender for the provision of the services referred to in subparagraph (a) hereof; an agreement with a related entity; or an agreement in so far as it relates to the licensing or assignment of a trademark, patent, registered design, copyright or EL rights within the meaning of the Circuits Layouts Act 1989 (Cth)) which contains a provision that:

(a)                has the purpose or effect or likely effect, whether by itself or together with another provision of any contract, arrangement or understanding to which the fourth respondent is a party, that

(i)                  the fourth respondent will not compete with another provider of fire alarm system installation services for the provision of those services to a particular person or class of persons; or

(ii)                the fourth respondent will allow another provider of fire alarm system installation services to win any tender let by a third person for the provision of such services; or

(iii)               another provider of fire alarm system installation services will allow the fourth respondent to win any tender let by a third person for the provision of such services; or

(b)               has the purpose or effect or likely effect of fixing, controlling or maintaining or providing for the fixing, controlling or maintaining of, the prices charged for fire alarm system installation services supplied or offered for supply by any of the parties to the contract, arrangement or understanding in competition with one another to other persons.

16C. Each of the twenty-seventh and twenty-eighth respondents be restrained, in Queensland and the Northern Territory, for a period of three years, from:

(i) being directly or indirectly knowingly concerned in or party to;

(ii) inducing or attempting to induce; or

(iii) aiding, abetting, counselling or procuring;

the making of, or arriving at, or giving effect to, by a corporation providing fire sprinkler system installation services, of any contract or arrangement or understanding (other than an agreement to jointly tender for the provision of the services referred to in subparagraph (a) hereof; an agreement with a related entity; or an agreement in so far as it relates to the licensing or assignment of a trademark, patent, registered design, copyright or EL rights within the meaning of the Circuits Layouts Act 1989 (Cth)) which contains a provision that:

(a)                has the purpose or effect or likely effect that:

(i)                  that corporation will not compete with another provider of fire sprinkler system installation services for the provision of those services to a particular person or class of persons; or

(ii)                that corporation will allow another provider of fire sprinkler system installation services to win any tender let by a third person for the provision of such services; or

(iii)               another provider of fire sprinkler system installation services will allow that corporation to win any tender let by a third person for the provision of such services; or

(b)               has the purpose or effect or likely effect of fixing, controlling or maintaining or providing for the fixing, controlling or maintaining of, the prices charged for fire sprinkler system installation services supplied or offered for supply by any of the parties to the contract, arrangement or understanding in competition with one another to other persons.

16D. Each of the twenty-seventh and twenty-ninth respondents be restrained, in Queensland and the Northern Territory, for a period of three years, from:

(i) being directly or indirectly knowingly concerned in or party to;

(ii) inducing or attempting to induce; or

(iii) aiding, abetting, counselling or procuring;

the making of, or arriving at, or giving effect to, by a corporation providing fire alarm system installation services, of any contract or arrangement or understanding (other than an agreement to jointly tender for the provision of the services referred to in subparagraph (a) hereof; an agreement with a related entity; or an agreement in so far as it relates to the licensing or assignment of a trademark, patent, registered design, copyright or EL rights within the meaning of the Circuits Layouts Act 1989 (Cth)) which contains a provision that:

(a)                has the purpose or effect or likely effect that:

(i)                  that corporation will not compete with another provider of fire alarm system installation services for the provision of those services to a particular person or class of persons; or

(ii)                that corporation will allow another provider of fire alarm system installation services to win any tender let by a third person for the provision of such services; or

(iii)               another provider of fire alarm system installation services will allow that corporation to win any tender let by a third person for the provision of such services; or

(b)               has the purpose or effect or likely effect of fixing, controlling or maintaining or providing for the fixing, controlling or maintaining of, the prices charged for fire alarm system installation services supplied or offered for supply by any of the parties to the contract, arrangement or understanding in competition with one another to other persons.

16E. The fourth respondent pay the applicant’s costs of and incidental to these proceedings in the agreed amount of $40,000 within fourteen days of the date of this order.

THE COURT FURTHER ORDERS THAT:

17A. In respect of its contraventions of ss 45(2)(a)(ii) and 45(2)(b)(ii) the Trade Practices Act 1974 (Cth), and of its ancillary involvement in contraventions of those sections, alleged in paragraph 126 of the statement of claim, a penalty in respect of all contraventions which occurred after 30 September 1993 of $500,000 be imposed upon the fifth respondent.

17B. In respect of its contraventions of ss 45(2)(a)(ii) and 45(2)(b)(ii) the Trade Practices Act 1974 (Cth), and of its ancillary involvement in contraventions of those sections, alleged in paragraph 127 of the statement of claim, a penalty in respect of all contraventions which occurred after 30 September 1993 of $230,000 be imposed upon the sixth respondent.

17C. In respect of his ancillary involvement in the contraventions by the fifth and sixth respondents of ss 45(2)(a)(ii) and 45(2)(b)(ii) the Trade Practices Act 1974 (Cth) alleged in paragraph 151 of the statement of claim, a penalty in respect of all contraventions which occurred after 30 September 1993 of $100,000 be imposed upon the thirtieth respondent.

17D. In respect of his ancillary involvement in the contraventions by the fifth respondent of ss 45(2)(a)(ii) and 45(2)(b)(ii) the Trade Practices Act 1974 (Cth) alleged in paragraph 152 of the statement of claim, a penalty in respect of all contraventions which occurred after 30 September 1993 of $30,000 be imposed upon the thirty-first respondent.

17E. In respect of his ancillary involvement in the contraventions by the sixth respondent of ss 45(2)(a)(ii) and 45(2)(b)(ii) the Trade Practices Act 1974 (Cth) alleged in paragraph 153 of the statement of claim, a penalty in respect of all contraventions which occurred after 30 September 1993 of $15,000 be imposed upon the thirty-second respondent.

17F. The penalty of the fifth respondent is to be paid to the Commonwealth of Australia as follows:

(a)                the sum of $80,000 within fourteen days of the date of this order;

(b)               the further sum of $140,000 on or before 25 January 2001;

(c)                the further sum of $140,000 on or before 25 January 2002;

(d)               the further sum of $140,000 on or before 25 January 2003;

(e)                if any instalment is not paid on or before the due date then the entire balance of the penalty of $500,000 then unpaid becomes immediately due and payable.

17G. The penalty of the sixth respondent is to be paid to the Commonwealth of Australia as follows:

(a)                the sum of $35,000 within fourteen days of the date of this order;

(b)               the further sum of $65,000 on or before 25 January 2001;

(c)                the further sum of $65,000 on or before 25 January 2002;

(d)               the further sum of $65,000 on or before 25 January 2003;

(e)                if any instalment is not paid on or before the due date then the entire balance of the penalty of $230,000 then unpaid becomes immediately due and payable.

17H. The penalties of each of the thirtieth, thirty-first and thirty-second respondents are to be paid to the Commonwealth of Australia within fourteendays of the date of this order.

THE COURT ORDERS BY CONSENT OF THE APPLICANT AND THE FIFTH, SIXTH, THIRTIETH, THIRTY-FIRST AND THIRTY-SECOND RESPONDENTS THAT:

18A. The fifth respondent be restrained, in Queensland, for a period of three years, whether by its directors, servants, agents, or otherwise howsoever, from making, arriving at or giving effect to any contract or arrangement or understanding (other than an agreement to jointly tender for the provision of the services referred to in subparagraph (a) hereof; an agreement with the sixth respondent or another related entity; or an agreement in so far as it relates to the licensing or assignment of a trademark, patent, registered design, copyright or EL rights within the meaning of the Circuits Layouts Act 1989 (Cth)) which contains a provision that:

(a)                has the purpose or effect or likely effect, whether by itself or together with another provision of any contract, arrangement or understanding to which the fifth respondent is a party, that:

(i)                  the fifth respondent will not compete with another provider of fire sprinkler system installation services for the provision of those services to a particular person or class of persons; or

(ii)                the fifth respondent will allow another provider of fire sprinkler system installation services to win any tender let by a third person for the provision of such services; or

(iii)               another provider of fire sprinkler system installation services will allow the fifth respondent to win any tender let by a third person for the provision of such services; or

(b)               has the purpose or effect or likely effect of fixing, controlling or maintaining or providing for the fixing, controlling or maintaining of, the prices charged for fire sprinkler system installation services supplied or offered for supply by any of the parties to the contract, arrangement or understanding in competition with one another to other persons.

18B. The fifth and sixth respondents be restrained, in Queensland, for a period of three years, whether by their directors, servants, agents or otherwise howsoever, from making, arriving at or giving effect to any contract or arrangement or understanding (other than an agreement to jointly tender for the provision of the services referred to in subparagraph (a) hereof; an agreement with a related entity; or an agreement in so far as it relates to the licensing or assignment of a trademark, patent, registered design, copyright or EL rights within the meaning of the Circuits Layouts Act 1989 (Cth)) which contains a provision that:

(a)                has the purpose or effect or likely effect, whether by itself or together with another provision of any contract, arrangement or understanding to which the fifth or sixth respondent is a party, that

(i)                  the fifth or sixth respondent will not compete with another provider of fire alarm system installation services for the provision of those services to a particular person or class of persons; or

(ii)                the fifth or sixth respondent will allow another provider of fire alarm system installation services to win any tender let by a third person for the provision of such services; or

(iii)               another provider of fire alarm system installation services will allow the fifth or sixth respondent to win any tender let by a third person for the provision of such services; or

(b)               has the purpose or effect or likely effect of fixing, controlling or maintaining or providing for the fixing, controlling or maintaining of, the prices charged for fire alarm system installation services supplied or offered for supply by any of the parties to the contract, arrangement or understanding in competition with one another to other persons.

18C. Each of the thirtieth and thirty-first respondents be restrained, in Queensland, for a period of three years, from:

(i) being directly or indirectly knowingly concerned in or party to;

(ii) inducing or attempting to induce; or

(iii) aiding, abetting, counselling or procuring;

the making of, or arriving at, or giving effect to, by a corporation providing fire sprinkler system installation services, of any contract or arrangement or understanding (other than an agreement to jointly tender for the provision of the services referred to in subparagraph (a) hereof; an agreement with a related entity; or an agreement in so far as it relates to the licensing or assignment of a trademark, patent, registered design, copyright or EL rights within the meaning of the Circuits Layouts Act 1989 (Cth)) which contains a provision that:

(a)                has the purpose or effect or likely effect that:

(i) that corporation will not compete with another provider of fire sprinkler system installation services for the provision of those services to a particular person or class of persons; or

(ii) that corporation will allow another provider of fire sprinkler system installation services to win any tender let by a third person for the provision of such services; or

(iii) another provider of fire sprinkler system installation services will allow that corporation to win any tender let by a third person for the provision of such services; or

(b) has the purpose or effect or likely effect of fixing, controlling or maintaining or providing for the fixing, controlling or maintaining of, the prices charged for fire sprinkler system installation services supplied or offered for supply by any of the parties to the contract, arrangement or understanding in competition with one another to other persons.

18D. Each of the thirtieth, thirty-first and thirty-second respondents be restrained, in Queensland, for a period of three years, from:

(i) being directly or indirectly knowingly concerned in or party to;

(ii) inducing or attempting to induce; or

(iii) aiding, abetting, counselling or procuring;

the making of, or arriving at, or giving effect to, by a corporation providing fire alarm system installation services, of any contract or arrangement or understanding (other than an agreement to jointly tender for the provision of the services referred to in subparagraph (a) hereof; an agreement with a related entity; or an agreement in so far as it relates to the licensing or assignment of a trademark, patent, registered design, copyright or EL rights within the meaning of the Circuits Layouts Act 1989 (Cth)) which contains a provision that:

(a)                has the purpose or effect or likely effect that:

(i)                  that corporation will not compete with another provider of fire alarm system installation services for the provision of those services to a particular person or class of persons; or

(ii)                that corporation will allow another provider of fire alarm system installation services to win any tender let by a third person for the provision of such services; or

(iii)               another provider of fire alarm system installation services will allow that corporation to win any tender let by a third person for the provision of such services; or

(b)               has the purpose or effect or likely effect of fixing, controlling or maintaining or providing for the fixing, controlling or maintaining of, the prices charged for fire alarm system installation services supplied or offered for supply by any of the parties to the contract, arrangement or understanding in competition with one another to other persons.

18E. The fifth and sixth respondents will jointly and severally pay the applicant’s costs of and incidental to these proceedings in the agreed amount of $40,000 within fourteen days of the date of this order.

THE COURT FURTHER ORDERS THAT:

19A. In respect of its contraventions of ss 45(2)(a)(ii) and 45(2)(b)(ii) the Trade Practices Act 1974 (Cth), and of its ancillary involvement in contraventions of those sections, alleged in paragraph 128 of the statement of claim, a penalty in respect of all contraventions of $100,000 be imposed upon the seventh respondent.

19B. In respect of his ancillary involvement in the contraventions by the third respondent and the seventh respondent of ss 45(2)(a)(ii) and 45(2)(b)(ii) the Trade Practices Act 1974 (Cth) alleged in paragraph 154 of the statement of claim, a penalty in respect of all contraventions which occurred after 30 September 1993 of $60,000 be imposed upon the thirty-third respondent.

19C. The penalty of the seventh respondent is to be paid to the Commonwealth of Australia as follows:

(a)                the sum of $50,000 within seven days of the date of this order;

(b)               the further sum of $10,000 on or before 22 September 2000;

(c)                the further sum of $10,000 on or before 22 March 2001;

(d)               the further sum of $10,000 on or before 22 September 2001;

(e)                the further sum of $10,000 on or before 22 March 2002;

(f)                 the further sum of $10,000 on or before 22 September 2002;

(g)                if any instalment is not paid on or before the due date then the entire balance of the penalty of $100,000 then unpaid becomes immediately due and payable.

19D. The penalty of the thirty-third respondent is to be paid to the Commonwealth of Australia as follows:

(a)                the sum of $10,000 within seven days of the date of this order;

(b)               the further sum of $5,000 on or before 22 September 2000;

(c)                the further sum of $5,000 on or before 22 March 2001;

(d)               the further sum of $5,000 on or before 22 September 2001;

(e)                the further sum of $5,000 on or before 22 March 2002;

(f)                 the further sum of $5,000 on or before 22 September 2002;

(g)                the further sum of $5,000 on or before 22 March 2003;

(h)                if any instalment is not paid on or before the due date then the entire balance of the penalty of $60,000 then unpaid becomes immediately due and payable.

THE COURT ORDERS BY CONSENT OF THE APPLICANT AND THE SEVENTH AND THIRTY-THIRD RESPONDENTS THAT:

20A. The seventh respondent be restrained, in Queensland and the Northern Territory, for a period of three years, whether by its directors, servants, agents, or otherwise howsoever, from making, arriving at or giving effect to any contract or arrangement or understanding (other than an agreement to jointly tender for the provision of the services referred to in subparagraph (a) hereof; an agreement with a related entity; or an agreement in so far as it relates to the licensing or assignment of a trademark, patent, registered design, copyright or EL rights within the meaning of the Circuits Layouts Act 1989 (Cth)) which contains a provision that:

(a)                has the purpose or effect or likely effect, whether by itself or together with another provision of any contract, arrangement or understanding to which the seventh respondent is a party, that:

(i)                  the seventh respondent will not compete with another provider of fire sprinkler system installation services for the provision of those services to a particular person or class of persons; or

(ii)                the seventh respondent will allow another provider of fire sprinkler system installation services to win any tender let by a third person for the provision of such services; or

(iii)               another provider of fire sprinkler system installation services will allow the seventh respondent to win any tender let by a third person for the provision of such services; or

(b)               has the purpose or effect or likely effect of fixing, controlling or maintaining or providing for the fixing, controlling or maintaining of, the prices charged for fire sprinkler system installation services supplied or offered for supply by any of the parties to the contract, arrangement or understanding in competition with one another to other persons.

20B. The thirty-third respondent be restrained, in Queensland and the Northern Territory, for a period of three years, from:

(i) being directly or indirectly knowingly concerned in or party to;

(ii) inducing or attempting to induce; or

(iii) aiding, abetting, counselling or procuring;

the making of, or arriving at, or giving effect to, by a corporation providing fire sprinkler system installation services, of any contract or arrangement or understanding (other than an agreement to jointly tender for the provision of the services referred to in subparagraph (a) hereof; an agreement with a related entity; or an agreement in so far as it relates to the licensing or assignment of a trademark, patent, registered design, copyright or EL rights within the meaning of the Circuits Layouts Act 1989 (Cth)) which contains a provision that:

(a)                has the purpose or effect or likely effect that:

(i)                  that corporation will not compete with another provider of fire sprinkler system installation services for the provision of those services to a particular person or class of persons; or

(ii)                that corporation will allow another provider of fire sprinkler system installation services to win any tender let by a third person for the provision of such services; or

(iii)               another provider of fire sprinkler system installation services will allow that corporation to win any tender let by a third person for the provision of such services; or

(b)               has the purpose or effect or likely effect of fixing, controlling or maintaining or providing for the fixing, controlling or maintaining of, the prices charged for fire sprinkler system installation services supplied or offered for supply by any of the parties to the contract, arrangement or understanding in competition with one another to other persons.

20C. The thirty-third respondent be restrained, in Queensland and the Northern Territory, for a period of three years, from:

(i) being directly or indirectly knowingly concerned in or party to;

(ii) inducing or attempting to induce; or

(iii) aiding, abetting, counselling or procuring;

the making of, or arriving at, or giving effect to, by a corporation providing fire alarm system installation services, of any contract or arrangement or understanding (other than an agreement to jointly tender for the provision of the services referred to in subparagraph (a) hereof; an agreement with a related entity; or an agreement in so far as it relates to the licensing or assignment of a trademark, patent, registered design, copyright or EL rights within the meaning of the Circuits Layouts Act 1989 (Cth)) which contains a provision that:

(a)                has the purpose or effect or likely effect that:

(i)                  that corporation will not compete with another provider of fire alarm system installation services for the provision of those services to a particular person or class of persons; or

(ii)                that corporation will allow another provider of fire alarm system installation services to win any tender let by a third person for the provision of such services; or

(iii)               another provider of fire alarm system installation services will allow that corporation to win any tender let by a third person for the provision of such services; or

(b)               has the purpose or effect or likely effect of fixing, controlling or maintaining or providing for the fixing, controlling or maintaining of, the prices charged for fire alarm system installation services supplied or offered for supply by any of the parties to the contract, arrangement or understanding in competition with one another to other persons.

20D. The seventh respondent pay the applicant’s costs of and incidental to these proceedings in the agreed amount of $20,000 within seven days of the date of this order.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

1                     The Australian Competition and Consumer Commission (“the Commission”) and the fourth, twenty-seventh, twenty-eighth and twenty-ninth respondents of the Court propose that the Court make orders by consent in terms of the draft which is annexure C to the joint submissions, exhibit 1. The case arises out of a collusive tendering and price fixing set of arrangements which involved the fourth, twenty-seventh, twenty-eighth and twenty-ninth respondents in both the Queensland sprinkler market and the Queensland fire alarm market between October 1993 and May 1997 so far as the sprinkler market is concerned and between 1992 and 1995 so far as the fire alarm market is concerned. Contraventions of s 45 the Trade Practices Act 1974 (Cth) are alleged.

2                     The background to the present application was dealt with at some length in the reasons I published on 14 December 1999 in proceedings for a penalty in circumstances where joint submissions were provided to the Court by the applicant Commission and a number of the other respondents including Tyco Australia Pty Ltd. It is apparent that Patricks, the fourth respondent, was a substantial participant in both the sprinkler and fire alarm markets in each of the periods and that by its managing director, the twenty-seventh respondent, participated extensively in the arrangements that contravene s 46 the Trade Practices Act 1974 (Cth). It was at Mr Thomson’s direction that the other two respondents participated in the arrangements.

3                     I will make orders by consent in terms of the draft annexure C to exhibit 1.

4                     I should say I am satisfied that the penalties proposed by the applicant and those five respondents are in my opinion within a range of appropriate penalties. The fifth respondent and its wholly owned subsidiary, the sixth respondent, are fairly substantial participants in each of the sprinkler and fire alarm markets in question. It is apparent that as a result of the activities of the thirtieth respondent, the managing director of both the fifth and sixth respondents took an active part in the arrangements that contravene s 45 the Trade Practices Act 1974 (Cth) over a substantial period.

5                     It is apparent that these respondents, as did the Patrick respondents, co-operated in materially significant ways with the Commission; a matter that is of course directly relevant to the amount of the penalty to be imposed. Having considered the submissions which I think I have marked exhibit 2, I am prepared to make by consent orders in terms of the draft which is annexure C to exhibit 2.

6                     In this matter, the Commission seeks orders against the seventh respondent in respect of its conduct contravening s 45 in the sprinkler market to which I have referred from mid-1995 until about May 1997. The thirty-third respondent was the founding principal of the seventh respondent, and orders are also sought against him in that capacity because of his involvement in the contravening conduct. However, the Commission also seeks orders against the thirty-third respondent in respect of conduct he engaged in between about 1986 and November 1994 while he was employed as Queensland Divisional Manager of FFE. So far as the seventh respondent is concerned, and the thirty-third respondent’s activities in relation to the seventh respondent, they are confined to conduct in breach of s 45 in the sprinkler market.

7                     So far as the orders sought against the thirty-third respondent in respect of his conduct whilst senior officer of FFE are concerned, they are in respect of his conduct in both the sprinkler and the alarm markets. In relation to the thirty-third respondent’s conduct as an officer of FFE up to November 1994, the material before me is to the effect that the thirty-third respondent first became involved in the contravening activities while officer of FFE at the direction of the then Queensland State Manager of FFE. Having considered the submissions, I am prepared to make against the seventh respondent orders in terms of the draft annexure C to exhibit 3. And in respect of the thirty-third respondent in relation to his conduct both while employed by FFE and thereafter as the principal of the seventh respondent, I am prepared to make orders also in terms of those proposed in annexure C to exhibit 3.

Associate: Dated: 20 June 2000