ACCC wants Forrest to explain call for iron-ore production cap
PERTH (miningweekly.com) –The Australian Competition and Consumer Commission (ACCC) has called on mining magnate Andrew Forrest to explain his calls for iron-ore producers to work together to cap production to halt the fall of the iron-ore price.
“The ACCC will be looking closely at Forrest’s comments and the context in which they were made. In general terms, any attempt by Australian businesses to encourage competitors to restrict output is a matter of grave concern to the ACCC,” said ACCC chairperson Rod Sims.
“Ultimately, any success in increasing the price of iron-ore in an anti-competitive way would be expected to lead to an increase in prices that Australian consumers pay for items such as whitegoods and cars.”
Forrest has come under fire after comments made at a business dinner in Shanghai, where the chairperson of iron-ore producer Fortescue Metals suggested that major producers should cap production of Pilbara ore in an effort to stop the decline of the iron-ore price.
Forest was quoted as saying that he would be ‘happy’ to cap Fortescue’s production at 180-million tonnes a year.
Company MD Nev Power has defended the remarks, saying that the comments were validated under Section 51 of the Competition and Consumer Act, which the company believed allowed for a production cap.
Sims said this week that cartel conduct, anti-competitive agreements, price fixing and attempts to bring about collusive arrangements were “very serious” matters.
“These arrangements do not need to be put into effect to be in breach of the law. Under the Competition and Consumer Act (2010) there are civil and criminal penalties for both cartel conduct and attempts to engage in cartel conduct.”
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