Two recent cases give insights into the courts’ view of compliance programs: BMW v ACCC and ACCC v George Weston.
In BMW Australia Limited v Australian Competition & Consumer Commission [2004] FCAFC 167 the Full Court of the Federal Court of Australia found that BMW had breached the Trade Practices Act (TPA) by using safety warnings which did not comply with the Australian Safety Standards on the jacks in its 318i models.
On appeal BMW argued against an order of the trial judge that an external auditor of BMW’s TPA compliance program be appointed. The Full Court said there was no legislative authority for such an order and even if there was, it found that the relevant matters (eg wilful refusal to include certain issues into its compliance program or a history of non-compliance) had not been established.
In Australian Competition & Consumer Commission v George Weston Foods Limited [2004] FCA 1093, George Weston Foods Limited was fined $1.5M in relation to a price fixing attempt by a senior executive relating to the price of flour.
The trial judge rejected the ACCC’s request for orders relating to a compliance program as he was satisfied that the company had a serious and well designed compliance program. The executive knew his telephone call from a public telephone to a competitor was illegal. “No compliance program can effectively deal with deliberate breaches by those at Board level.”
The size of the penalty reflected the fact that while the executive was dismissed and no actual damage was suffered:
.
The judge thought the penalty of $1.5M suggested by ACCC was very much at the low end the range but accepted it.
