The Federal Court of Australia has recently made orders by consent against Quickcat Cruises (QLD) Pty Limited in relation to its ferry service to Dunk Island in North Queensland.
The orders follow allegations by the Australian Competition and Consumer Commission that Quickcat Cruises had entered into a price-fixing agreement with one of its competitors.
The ACCC alleged that Quickcat Cruises approached the proprietor of a competitor in late 1999 requesting that the competitor increase its price, stop offering free trips to children under 10 years and requesting that the competitor stop offering free BBQs. The ACCC alleged that Quickcat Cruises offered to stop discounting in return for an agreement to the above.
The Federal Court of Australia, in Brisbane, made orders by consent including declarations that Quickcat Cruises had breached the price fixing provisions of the Trade Practices Act 1974, injunctions restraining future conduct, and an order that Quickcat Cruises contribute to the ACCC's legal costs.
Quickcat Cruises has also agreed to provide the ACCC court enforceable undertakings which include:
- the preparation of, and adherence to, a trade practices compliance program for at least three years
- the offering and provision of free return trips between Mission Beach and Dunk Island to age pensioners for a period of two consecutive weeks
- the advertising of the free trips in the local newspaper
"Quickcat Cruises’ undertaking to provide free trips to age pensioners from the community effected was an important consideration in resolving the matter", ACCC Chairman, Professor Allan Fels, said today.
While all allegations of price fixing are considered extremely serious, the ACCC has taken a more lenient approach in this matter given that Quickcat Cruises was a smaller business and that the alleged agreement was only in place for a very short period of time and as such the effect on customers was quite limited. However, given the seriousness of the price fixing provisions, the ACCC believed court action was appropriate.
"If there is one message that the ACCC can impart to Australian businesses in relation to the competition provisions of the Act, it would have to be that price fixing agreements between competitors are illegal and will be met with strong enforcement action", Professor Fels said.
Agreements, arrangements or understandings on price between competitors are prohibited by the Act. The ACCC views attempts at price fixing as extremely serious. Companies may be penalised up to $10,000,000 and individuals up to $500,000.