In one of the last court proceedings instituted by the Australian Competition and Consumer Commission ("ACCC") in 2013, the ACCC filed proceedings against Australia's leading suppliers of laundry products alleging a "laundry detergent cartel." The ACCC alleges that three manufacturers of laundry products agreed to stop supplying standard-concentrate laundry detergents and agreed to supply only ultraconcentrate detergents starting in 2009.

The companies are alleged to have:

  • Coordinated their ultraconcentrate products to meet certain specifications, including packaging dimensions and configuration;
  • Entered into a "Pricing Parity Arrangement," agreeing not to pass on the cost savings generated by manufacturing and supplying ultraconcentrates; and
  • Two of the manufacturers are alleged to have shared market sensitive information regarding pricing and proposed pricing increases.

The ACCC discovered the cartel as a result of an immunity application by Unilever, one of the three manufacturers. Interestingly, the ACCC is also going after Woolworths, one of two supermarket chains that predominate Australian retail. The ACCC is alleging that the company was knowingly involved in the arrangements, pointing in particular to the fact that various meetings where these arrangements were discussed were held at Woolworths' offices and involved Woolworths' staff.

The case highlights both the importance of active compliance programs to be able to discover potential competition law exposures while immunity is available, and the limits of industry collaboration in setting common standards or agreed approaches to industrywide innovation. In relation to the allegations against Woolworths, this case serves as useful reminder that the ACCC will not hesitate to prosecute those that are not directly responsible for forming and reaching cartel agreements – those that are aware of the elements of conduct that would constitute the breach and who only play a small part in facilitating the breach can also be alleged to be knowingly concerned.

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