ACCC joins ‘Five Eyes’ alliance to prevent supply chain cartel conduct

The Australian Competition and Consumer Commission (ACCC) is teaming up with four of its international counterparts across the ‘Five Eyes’ nations to prevent anti-competitive conduct in global supply chains amid the COVID-19 pandemic.

The ACCC will be working with the US Department of Justice and Federal Bureau of Investigation, Canadian Competition Bureau, NZ Commerce Commission, and UK Competition and Markets Authority, to share intelligence on combatting anti-competitive behaviour in the industry.

As freight rates balloon seven times higher than before the pandemic and the cost of goods continue to rise, the ‘Five Eyes’ strategic alliance will be cracking down on illegal conduct, including collusion, in global supply chains.

ACCC Chair Rod Sims explained that the international partnership was needed due to the complexity of the global freight supply chain.

“COVID-19 has caused the supply chain disruptions the world is currently experiencing, but the purpose of this working group is to detect any attempts by businesses to use these conditions as a cover to work together and fix prices,” Sims said.

“We will be sharing intelligence to identify any behaviour that restricts or distorts competition, and companies are now on notice that the ACCC and its international counterparts will be ready to act,” he said.

The ACCC said that the working group will be watching for anti-competitive conduct, including cartels, and any other activities that materially impact competition, such as exclusionary arrangements by firms with market power.

In a media release, NZ Commission Chair Anna Rawlings said that the new working group will strengthen their continued efforts to deter and penalise cartel conduct.

“We still have zero-tolerance for unscrupulous businesses using Covid as an opportunity for cartel conduct, such as non-essential collusion between competitors or anti-competitive behaviour,” she said.

Since April 2021, individuals involved in cartel conduct can be liable for a term of imprisonment of up to 7 years in New Zealand.

The new working group complements existing formal and informal agreements the ACCC has with competition agencies in the US, UK, Canada and NZ, including a cooperation agreement the ACCC signed with the FBI in 2019.

The competition watchdog is also pushing for greater supply chain cooperation across the country in the wake of supply chain breakdowns caused by recent flooding.

Last week, it granted a rare urgent interim to allow freight companies to co-operate to get groceries into Western Australia and the Northern Territory, which on any other instance, would breach competition laws.