Friday, 15 December 2017 Sydney
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Full Federal Court dismisses ACCC’s appeal in Australian Egg Corporation case::

The Full Federal Court has dismissed the ACCC’s appeal in its matter against the Australian Egg Corporation Limited (AECL), Farm Pride Foods Ltd (Farm Pride) and Ironside Management Services Pty Ltd (trading as Twelve Oaks Poultry) (Twelve Oaks Poultry) and two executives, Mr James Kellaway and Mr Jeffrey Ironside. 

The ACCC had alleged that at an ‘Egg Oversupply Crisis Meeting’, held by AECL and attended by egg producers, the AECL and the other respondents had attempted to induce egg producers to enter into a cartel arrangement to reduce the supply of eggs, in response to a perceived oversupply of eggs.

In February 2016, the Federal Court dismissed the ACCC’s proceedings. The ACCC appealed to the Full Federal Court, who today dismissed the ACCC’s appeal.

“Australians spend over half a billion dollars a year on eggs. The ACCC commenced these proceedings because we were concerned that if the alleged attempted cartel arrangement had been successful, and implemented to reduce the supply of eggs, it could have increased the price of eggs,” ACCC Chairman Rod Sims said.

“The ACCC appealed to the Full Court to seek clarity about what conduct is sufficient to constitute an attempt to induce cartel conduct, particularly in the context of conduct by a trade association interacting with its members.”

“This case highlights the importance of the Federal Government’s Competition Policy Reform Bill, which introduces a concerted practices prohibition into Australian competition law,” Mr Sims said.

“The ACCC will carefully consider the judgment of the Full Court.”

Background

The ACCC initially instituted proceedings in the Federal Court in May 2014.

The Federal Court of Australia found the parties did not attempt to induce a cartel arrangement in February 2016. The ACCC appealed the decision later in February 2016.

In May 2016, the Federal Court ordered Mr Zelko Lendich, a former director of the Australian Egg Corporation Limited (AECL) and the former managing director of Farm Pride Foods Ltd (Farm Pride), to pay a pecuniary penalty of $120,000 for an attempt to induce a cartel arrangement between competing egg producers.