The Federal Court of Australia found that on three occasions between 2009 and 2011, Mitsubishi Electric through the conduct of its senior managers induced and attempted to induce one of its Australian dealers, Mannix Electrical Pty not to sell Mitsubishi Electric branded air conditioning products at prices below a minimum specified price; reduced the discounts Mannix had received from Mitsubishi Electric by terminating its ‘dealer’ status, for reasons including Mannix’s failure to increase its prices of Mitsubishi Electric branded air conditioning products to the minimum specified price.
Resale price maintenance is prohibited under section 48 of Australia’s Competition and Consumer Act 2010.
The Court ordered Mitsubishi Electric to pay a penalty of AUS$500,000 for each act of resale price maintenance in 2009 and 2010, and AUS$1.2m for its termination of Mannix’s ‘dealer’ status in 2011.
In relation to the termination of Mannix’s ‘dealer’ status, the judge, Justice Mansfield, said that “this type of conduct is considered to be at the serious end of the scale of resale price maintenance conduct because it involved [Mitsubishi Electric] taking action, partly driven by complaints from Mannix’s competitors, to prevent Mannix from acting as an effective competitor in the market.”
“Mitsubishi Electric is a company of significant size and resources and this penalty reflects the seriousness of its conduct. The outcome should act as a deterrent to other companies from engaging in anti-competitive conduct in the future,” said Rod Sims, chairman of the Australian Competition and Consumer Commission (ACCC).
The Court also made orders for declarations, injunctions, and a contribution by Mitsubishi Electric to the ACCC’s costs in the amount of AUS$50,000.