Livestock companies fined $3M for price-fixing
Livestock firms have been slapped with a $3 million fine for colluding to fix prices they charge farmers to tag cattle.
PGG Wrightson and Rural Livestock have been fined $2.7 million and $475,000 respectively in separate penalty hearings in the Auckland High Court.
They were taken to court by the Commerce Commission which investigated a complaint by a Northland farmer around prices charged for untagged animals sold at saleyards.
The Commission's investigation found the two firms entered into anti-competitive agreements in 2012 to set fees they charge farmers, including a rule that tagging of any cattle would incur a minimum $25 charge.
They also agreed on an increased yard fee and set administration fees, justifying the surcharges as necessary to recover additional costs incurred by complying with the new livestock monitoring legislation introduced that year.
Both companies reached separate settlement agreements with the Commission after admitting their conduct breached the Commerce Act.
Court proceeding were then filed, with a judgment published today revealing more than $3M in fines.
The Commission has also mounted similar cases against Elders New Zealand and five individuals, with the cases still before the courts.
It also issued a warning to the industry body, New Zealand Stock and Station Agents Association, and seven other livestock companies it considers are likely to have breached the Act.
As court proceedings remain ongoing in this case, the commission would not comment any further.