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A High Court ruling has confirmed that people who allegedly enter into cartel agreements overseas aimed at a New Zealand market, can be pursued in this country's courts.
The court ruled that the Commerce Commission could pursue penalty proceedings against three defendants in a wood chemicals cartel case who were living overseas when the cartel was operating, the commission said yesterday.
More than $5 million of fines had already been imposed in relation to the cartel that operated in New Zealand's wood preservative chemicals industry from 1998 to 2002.
Elias Akle, Andrew Poynter and Neil Harris had protested the jurisdiction of the court to hear the commission's cartel claim against them, the commission said.
They argued that they lived overseas and did not perform any acts in New Zealand that breached the Commerce Act. The commission accepted that most of their alleged actions took place outside New Zealand, mainly occurring in Australia, but noted that the cartel affected New Zealand businesses and consumers.
The court set aside the protests of all defendants, the commission said.
Commerce Commission chairwoman Paula Rebstock said the judgment went a long way towards ensuring that unlawful agreements entered into overseas, but aimed at New Zealand markets, could be the subject of legal action here.
A full hearing would be needed to determine whether any of the individuals had breached the Act, the commission said.
Two of the defendants had indicated they would apply to appeal the jurisdiction judgment.
Chapman Tripp competition law specialist Neil Anderson told today's Dominion Post that the decision was significant in the specific context of cartels.
The decision was an incremental win for the commission, he said.
"I think most people are aware they are taking risks when they partake in cartel behaviour anyway. All it means is there is a greater clarity that the law will catch you."
- NZPA W
