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ComCom to file court proceedings over price fixing

Published: Tue 7 Jul 2015 12:31 PM
ComCom to file court proceedings against Wrightson, Elders, Rural Livestock over price fixing
By Suze Metherell
July 7 (BusinessDesk) - The Commerce Commission intends to file court proceedings against PGG Wrightson, Elders New Zealand and Rural Livestock by the end of the month, claiming the three fixed fees charged during the implementation of a national livestock tagging scheme.
The consumer protection authority is investigating fees charged during the adoption of the National Animal Identification and Trading Act 2012, commonly known as NAIT. A spokesman for the commission confirmed it intends to file proceedings against the three agricultural companies and five undisclosed individuals before the end of this month.
NAIT is an industry-based initiative which the government helped fund, requiring radio tags for cattle and deer and allowing nationwide tracing of livestock in a bid to bolster New Zealand's response to any biosecurity threats.
Yesterday, Wrightson, the listed rural services firm controlled by China's Agria Corp, revealed the commission believe it had breached the Commerce Act over how it charged fees during the scheme's implementation and that it would "seek a pecuniary penalty from PGW”. Wrightson has cooperated with the investigation and said the penalty, while significant, is unlikely to be “materially price-sensitive”.
Companies convicted of price-fixing can attract a maximum penalty that's the greater of $10 million, or three times the commercial gain, or if that can't be established easily, 10 percent of turnover.
Rural Livestock chairman John Faulks said he didn't know about the investigation and declined to comment. Elders New Zealand also declined to comment.
Wrightson shares were unchanged at 47 cents on the NZX.
(BusinessDesk)
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