The Commerce Commission has filed separate civil proceedings in the High Court against Aramex New Zealand Holdings Limited (Aramex) and Sweetspot Group Limited (GoSweetSpot) for engaging in cartel conduct.
Aramex is a carrier that provides courier transportation services to customers. The company’s services are used by 75,000 customers and businesses in New Zealand, including the likes of Briscoe Group and Rebel Sport.
Meanwhile, GoSweetSpot is a reseller, which ‘brokers’ the provision of courier transportation services to customers. Both resellers and carriers can compete for the same customers.
The Commerce Commission does not allege that Aramex and GoSweetSpot entered into an agreement with each other. Rather, Aramex has admitted to entering into and giving effect to a contractual arrangement that allocated customers and fixed prices between itself and another competitor in the courier services market.
Separately, GoSweetSpot has admitted to entering into and giving effect to contractual arrangements that allocated customers between itself and another competitor in the courier services market.
The Commission and each of Aramex and GoSweetSpot have agreed settlements to resolve the separate proceedings. A penalty hearing will be scheduled for each shortly.
According to the Commission, both of the contracts were negotiated in the context of reseller/carrier arrangements.
As the proceedings are now before the court, the Commission will not be providing further detail or comment at this time.
A cartel is where two or more businesses agree not to compete with each other including by price fixing, allocating markets or customers, rigging bids, or restricting the output or acquisition of goods and services.
The Commission noted that because cartel members make more profit than they would if they competed fairly, goods and services become more expensive, consumers end up with fewer choices, and quality and service levels are likely to deteriorate.