Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Two ocean freight companies, two executives plead guilty to Canada price fixing charges, (Apr 9, 2014)
Organizations Mentioned:ECU Line Canada, Inc. | Overseas Container Forwarding, Inc.
By John W. Arden, J.D., LL.M.
Following the Canada Competition Bureau’s investigation into the ocean freight industry, two Canadian companies and two executives have pleaded guilty to two counts each of criminal conspiracy for their participation in a price-fixing cartel related to the imposition of surcharges, including those for currency exchange rate fluctuations and fuel.
ECU Line Canada Inc., Elvio Lancione, and Michael Teixeira pleaded guilty to charges relating to the surcharges for the supply of non-vessel operating common carrier export consolidation services from Canada to various foreign destinations between January 1, 2005 and March 6, 2011, the Competition Commission announced yesterday. The defendants admitted that they agreed with other participants on the rates or formulas used to calculate the rates of various surcharges.
Lancione is Executive Vice President, responsible for ECU operations in Eastern Canada, while Teixeira is Vice President overseeing operational affairs in Western Canada.
ECU Line was fined (Can.) $1 million by the Ontario Court of Justice in Ottawa and is required to set up a corporate compliance program under the terms of a prohibition order. Lancione was sentenced to two concurrent conditional sentences of four months and 30 hours of community service. Teixeira received two concurrent three-month conditional sentences and 20 hours of community service.
Overseas Container Forwarding, Inc. pleaded guilty and was fined (Can.) $675,000 by the Ontario Superior Court of Justice in Ottawa, the Competition Commission announced today. The company is further required to establish a corporate compliance program under the terms of a prohibition order.
Overseas Container agreed with Lancione, Teixeira, ECU and other participants on the rates or formulas used to calculate the rates of surcharges between January 1, 2005 and March 6, 2011 for the supply of non-vessel operating common carrier export consolidation services from Canada to various foreign destinations.
Non-vessel operating common carriers consolidate less-than-container load shipments into containers, coordinate the shipment of these containers by ocean, and arrange for the deconsolidation of the containers at the destination. The Competition Bureau began investigating this cartel in December 2009, when it became aware of it through its Immunity Program.
“Pursuing those who fix prices, rig bids, or engage in other types of cartel activity is a top Bureau priority,” said Commissioner of Competition John Pecman. “Every business in this country is required to act lawfully, and the risks and penalties of not complying with the Competition Act and other legislation governing business can be very damaging.”
Companies: ECU Line Canada, Inc.; Overseas Container Forwarding, Inc.
News: Antitrust