Queensland builders found guilty of price-fixing

The Federal Court of Australia today found that Queensland builders had engaged in price fixing by requesting and exchanging cover prices when tendering for government building projects.

A builder requested a cover price when it had decided it did not wish to win a particular project. To do this, it would call a second (competing) builder who was submitting a tender to ask for a ‘cover price’. The cover price quoted would be above the price at which the second builder intended to bid. The first builder would then submit the cover price in the knowledge that it would not win the tender. The Australian Competition and Consumer Commission (ACCC) argued that this behaviour between competitors fixed, controlled or maintained prices. The Court agreed.

Frontier (Australia) advised the ACCC and gave evidence at the trial.

For more information, please contact Marita O’Keeffe at m.okeeffe@frontier-economics.com or call +61 (0)3 9620 4488.

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