High Court approved an agreed Commerce Commission settlement having dairy technology firm GEA Milfos pay a $825,000 fine for fixing prices with competitor Dairy Automation over supply of milk sensor and herd management software.
Milfos offers milk management systems as part of its package deal when installing new milking sheds on dairy farms. It sources milk sensors from competitor Dairy Automation Ltd. The High Court was told Milfos shared with Dairy Automation its in-house spreadsheet used as a ‘quote-calculator’ for new installations. In May 2012, the two competitors agreed to tie their sites together at farming field days and agreed not to quote against each other. This as a pre-cursor to a proposed exclusive distributorship; it never eventuated. Meanwhile, the two continued to use the Milfos quote-calculator, minimising price competition. Price-fixing is in breach of the Commerce Act.
The High Court was told Milfos held a market share of just over twenty per cent for milk testing and herd management systems through the four year period ending May 2015 with sales of under three million dollars. Extent of Milfos’ mark-up on milk testing equipment was supressed by the High Court.
Commerce Commission v. GEA Milfos International Ltd – High Court (20.06.19)
19.117