The Commerce Commission will appeal a $2.009 million fine handed to Steel & Tube, arguing an excessive discount had been applied to the penalty.

Last month Justice Duffy imposed the record $2m-plus fine on Steel & Tube in relation to 24 charges under the Fair Trading Act for false and misleading representations about steel mesh products.

The Commission is seeking leave to appeal to the Court of Appeal on the basis that the Judge erred when sentencing the company, by:

• failing to properly attribute the knowledge of a Steel & Tube manager to the company;
• applying an excessive totality discount to the penalty; and
• failing to adequately take into account the size of Steel & Tube and the potential for it to gain from the conduct.

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Steel & Tube was initially fined a then-record $1.89m in an Auckland District Court in October last year, but that fine was also appealed by the Commission.

The charges, brought by the Commerce Commission, related to conduct spanning four years, where Steel & Tube sold about 480,000 sheets of steel mesh for $24m from 482 batches.

Steel & Tube misled the public with representations that the mesh met an Australia/New Zealand standard for reinforcing steel when it didn't, and that the batches had been independently tested when they hadn't.

In the first sentencing, the Judge started at a $2.9m fine for the company, discounted to reflect Steel & Tube's cooperation and early guilty plea.

The Commission would not comment on the matter as it was before the Courts.

- Additional reporting Business Desk