Cracking down on criminal cartels: ACCC

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Cracking down on criminal cartels: ACCC

Peter McDonald

Australia’s cartel enforcement was impacted in 2018 by “several notable events”, which in turn have highlighted the work being done domestically to combat criminal activity, according to a new report.

Allen & Overy’s Global Cartel Enforcement Report 2019 has highlighted “a sharp rise in cartel enforcement fine levels” to US$45.6 million, an increase of more than US$15 million on the previous year’s fines.

The report flagged a number of “key” trends in cartel enforcement for Australia to explain such a dramatic increase in prosecution activity: The ACCC’s increasing of lobbying efforts for higher penalties to be given by the courts, as well as focusing on ensuring the size of penalties given to companies matched company size; the December 2018 government announcement of an increase in the budget supporting global cartel enforcement, and this funding leading to the appointment of six new cartel unit investigators to assist with future criminal cartel prosecution.

Allen & Overy partner Peter McDonald commented on the above trends as signaling “increased enforcement efforts by the ACCC”.

Flagging “several notable events in cartel enforcement”, Mr McDonald highlighted that “three criminal cartel cases were initiated involving senior managers, with the explicit threat of jail time”.

According to the lawyer, “perhaps the most significant case involves alleged arrangements relating to ANZ shares and several senior bankers”.


“This looks to be a tough case for the ACCC, and convictions are far from certain,” Mr McDonald said, but noted that “after many years of talk, ACCC chairman Sims has backed up his rhetoric of bringing several criminal cases before the courts each year”.

Elaborating on the ACCC’s standing, Mr McDonald said: “We have seen increased funding and the recruitment of more specialist cartel investigators, the agency working more closely with top global cartel experts like the US FBI, and a willingness to seek and obtain record high penalties following reports that Australia was lagging against comparable OECD economies.”

On a more global scale, Mr McDonald did flag “a general downturn in the number of leniency applications” as posing a challenge for enforcers.

“We will see how this plays out over the coming years, but it is likely attributable to the spread of aggressive private damages claims,” he explained.

“Cartelists are increasingly aware that creating a leniency paper trail can come with big compensation costs across multiple countries, including Australia.” 

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