A major Australian power tool supplier has been fined a record $15 million for engaging in resale price maintenance (RPM) in relation to Milwaukee products.
In the Federal Court on Friday, Techtronic admitted to entering 97 agreements with retailers and dealers between January 2016 and May 2020 which restricted the sale of Milwaukee products below a specified minimum price.
It also admitted to enforcing the RPM provisions in its contract 29 times between December 2016 and May 2020. The provisions included warnings for dealers who offered to sell, or sold, Milwaukee products below the specified minimum price.
The penalties are the highest imposed in Australia for breaching Section 48 of the Competition and Consumer Act 2010 (Cth). The court also ordered Techtronic to post corrective notices on its website and to its dealers; implement a compliance program; and pay part of the Australian Competition & Consumer Commission’s (ACCC) costs.
The Melbourne-based company is a wholesale supplier of Milwaukee products nationally, including to major retailers with multiple outlets and buying groups of multiple independent retailers. The product range includes power tools, hand tools and accessories.
The ACCC began proceedings against Techtronic in November 2021.
“The ACCC submitted to the Court that this level of penalty was appropriate given the seriousness, duration and extent of Techtronic’s conduct. It sends a strong signal to deter others from engaging in RPM, and should serve as a warning for all other businesses,” ACCC Deputy Chair Mick Keogh said.
“Resale price maintenance is illegal because it is harmful to price competition, which may mean consumers pay a higher price than they would in a truly competitive market.”
The Federal Court will publish its reasons at a later date.