Penalties totalling $535,625 have been imposed by the Federal Court on McMahon Services Pty Ltd, SA Demolition & Salvage Pty Ltd and DCD Enterprises Pty Ltd (trading as D&V Services) and a number of their representatives for price fixing a tender for demolition and asbestos removal work.
The action was instituted by the Australian Competition and Consumer Commission.
In late 2000, the Commonwealth Department of Defence invited a number of companies to tender for a project at its Salisbury site in South Australia. The project was valued at approximately $2.4 million and involved the removal of asbestos and demolition of all structures at the site prior to its sale to the South Australian Government for development as an automotive supply park. McMahon Services and SA Demolition were two of the companies invited to tender.
Specifically, the court imposed the following penalties:
- McMahon Services - $300,000
- Mr Phillip Bubner (Operations Demolition Manager, McMahon Services) - $35,000
- SA Demolition - $65,625
- Mr Spiros Parentes (director, SA Demolition) - $35,000
- D&V Services - $52,000, and
- Mr Fernando D’Apollonio (director, D&V Services) and Mr Vlado Turic (director, D&V Services) - $48,000 combined.
By consent, each of the companies and the various individuals gave undertakings to the court. The undertakings relate to the provision of asbestos and demolition services and include that the companies refrain from:
- making available to competitors any information, costings or budget estimates relating to the price which is likely to be tendered by them
- discussing with any competitor any information, costings or budget estimates relating to the price that is likely to be tendered by them
- acting upon documents provided by competitors concerning the prices that they are likely to tender
- knowingly fixing, or aiding or abetting the fixing of, price in any tender
- organising, attending or participating in any meeting of competitors for the purpose of fixing prices.
Similar undertakings were given in respect of the individuals and all the parties undertook to establish and/or attend trade practices compliance training.
The penalties ordered against SA Demolition, D&V Services and their directors were obtained by the consent of the parties.
ACCC Chairman, Mr Graeme Samuel, said today that the ACCC regarded the breaches as very serious. “Detecting, stopping and deterring cartel conduct is a top priority for the ACCC”, Mr Samuel said.
“Businesses should take note of Mr Justice Selway’s words in relation to the penalties he imposed on McMahon Services and Mr Bubner: ‘Collusive bidding practices are unacceptable whatever their effect in a particular transaction. Those involved in them must expect significant penalties’.”