ACCC v Yazaki Corporation (No 2) [2015] FCA 1304: Court Finds Yazaki Engaged in Collusive Conduct

In proceedings recently brought by the Australian Competition and Consumer Commission (ACCC), the Federal Court has found that a Japanese company, Yazaki Corporation (Yazaki), engaged in collusive conduct with its competitor in the supply of wire harnesses to Toyota Motor Corporation (Toyota) in Australia.

Background to the Case

The Federal Court found that in 2003 and 2008, Yazaki made and gave effect to arrangements with a competitor, which included the coordination of quotes to Toyota for the supply of wire harnesses used in the manufacture of the Toyota Camry. The anti-competitive conduct was exposed in early 2010.

In his judgment, Justice Besanko found that this was in breach of the exclusionary arrangement provisions of the Competition and Consumer Act 2010 (Cth) (ss 4, 4D, 4E 4F, 5, 8, 44ZZRD, 44ZZRK, 45, 75B, 77, 84) (the Act) and the Competition Code of Victoria (the Code) (ss 5, 8) [contained in the Competition Policy Reform (Victoria) Act 1995 (CPRA)].

The Court’s Findings

The Court found that Yazaki’s conduct was subject to the Act and the Code because Yazaki was carrying on business in Australia, notwithstanding that much of the conduct occurred in Japan.

However, the Court held that because the price fixing conduct by Yazaki did not occur in a market in Australia as required by the Act at the time of the conduct, it did not contravene the price fixing provisions.

The Court also found that Yazaki’s Australia subsidiary, Australian Arrow Pty Ltd (AAPL), engaged in market sharing and price fixing conduct in 2003 in relation to wire harnesses used in the manufacture of the 2002 model Toyota Camry. However, the Court did not accept the ACCC’s argument that AAPL gave effect to the 2003 and 2008 agreements made by Yazaki.

Reaction from the ACCC

Commenting in a recent ACCC Media Release, the ACCC Chairman Rod Sims said:

The ACCC was not successful in all claims. The Court rejected the argument that Australian Arrow gave effect to the collusive arrangement entered into by Yazaki in Japan. It also found that there was no price fixing arrangement within the terms of the former price fixing provisions in the Act, as there was not the required market in Australia for supply of wireframes to Toyota.

Previous ACCC Cartel Action

The ACCC’s action follows similar enforcement action against Yazaki and other cartel participants by competition regulators in the US, Canada, and Japan. It arose from an immunity application which reported the conduct.

TimeBase is an independent, privately owned Australian legal publisher specialising in the online delivery of accurate, comprehensive and innovative legislation research tools including LawOne and unique Point-in-Time Products.

Federal Court finding against Yazaki Corporation

Federal court finds Yazaki corporation engaged in collusive conduct – ACCC Media Release MR 232/15

ACCC v Yazaki Corporation (No 2) [2015] FCA 1304 (24 November 2015)