The relentless march of globalisation was slowed somewhat last week. A national court held several multi-national companies to count for anti-competitive practices. The national court was the Australian Federal Court and the multi-national companies were three pharmaceutical giants and their Australian vitamin subsidiaries, Roche Vitamins Australia Pty Ltd, BASF Australia Ltd and Aventis Animal Nutrition Pty Ltd.
The three companies were fined a total of $26 million for price collusion. One company was fined $15 million, the highest single fine in Australian Trade Practices history. The companies were also restrained from meeting to discuss pricing matters for four years. If they break that order they will be up for criminal sanctions.
The case is highly significant because the Australian arms of these companies were acting under secret agreements made at the international level of their respective companies. It shows that multi-nationals are not above local law and that they cannot always ride roughshod over national considerations, contrary to the typical anti-globalisation mantra.
The other significance of the case is that globalisation is often seen as a concurrent evil with competition policy. In this instance, however, one (competition policy) was used as a sword against the other (globalisation).
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