BlueScope Steel Limited v Australian Competition and Consumer Commission [2025] FCAFC 118

1. By ground 4, Mr Ellis contends that the primary judge erred in finding, at LJ [1454], that the appellants attempted to induce an understanding between BlueScope and distributors in which strict adherence to the recommended resale price was not required, and that the recommended resale price provided a price level around which the understanding could cohere, in circumstances in which:

(a) such an understanding was not alleged by the ACCC;

(b) such an understanding was inconsistent with findings by the primary judge to the effect that Mr Ellis intended the recommended resale price would operate as a base or floor price;

(c) the primary judge did not make any finding that Mr Ellis told any of the distributors that the recommended resale price should operate as a floor price, a baseline price or a minimum price;

(d) the primary judge found the sole reference to the recommended resale price being a minimum price was in a presentation prepared by another employee of BlueScope and sent to Mr Ellis to be presented to Mr Vassella;

(e) the primary judge did not make any finding that any of the distributors understood the term benchmark to refer to a minimum price;

(f) each of Mr Hennessy, Mr Kelso and Mr Ellis gave evidence to the effect that it would not have been possible to simply to fix prices at the level of the recommended resale price because distributors needed to retain pricing flexibility;

(g) the distributors gave evidence, some of which is referred to in the LJ, to the effect that it would not have been possible for the distributors to follow the recommended resale price because they needed to retain pricing flexibility.

1. Ground 4 does not fairly or accurately capture the primary judge's findings as to the understanding that his Honour concluded was sought to be induced by the appellants. It is convenient in framing what follows to extract the primary judge's finding at LJ [1454]:

...The consensus was for distributors to use the list prices in CIPA's Distribution Market price lists for flat steel products as a base or floor price for their supply of flat steel products. I do not consider that the understanding that was sought to be induced was intended to be adopted by distributors in an absolute manner, requiring strict adherence to CIPA's price lists as a base or floor price. Rather, the understanding that was sought to be induced was a more general adherence to a principle that distribution prices should be increased to the level of CIPA's price lists by way of a floor. CIPA's price lists provided a clear price level around which the understanding could cohere.

1. It is not the last sentence, but the penultimate one that clarifies what the primary judge saw to be the content of the understanding, namely "a more general adherence to a principle that distribution prices should be increased to the level of CIPA's price lists by way of a floor".
2. That subtlety must be borne in mind when considering what follows and informs his Honour's findings elsewhere that the purpose of the benchmarking strategy was to promote the CIPA price lists for use as a "base" or "floor" price. The nature of his Honour's findings is described further at [430] below.

Did the ACCC advance a case that the recommended resale price was a floor or minimum price?

1. Mr Ellis contends that the ACCC advanced a case that distributors could use the recommended resale price as a benchmark when selling flat steel products. He argues that it was not in any sense alleged that it was a minimum price.
2. Senior counsel for Mr Ellis was careful to note that this ground of appeal is not a mere pleading point. Rather, she submitted the way in which the ACCC built and led its case could not support the findings the primary judge made.
3. It is therefore necessary to consider both how the ACCC pleaded its case based on the RRP strategy, and how it was explained in its opening and closing submissions.
4. The appellants submit that the ACCC's written opening submissions before the primary judge did not mention the notion of a floor or minimum price, nor was there any reference to it in the further amended statement of claim (FASOC). They acknowledge that the word "floor" appeared in the FASOC at [149], but only in a reference to Mr Vassella's knowledge. They submit that the first reference to a floor or minimum price occurred in the oral opening address of the ACCC on 30 August 2021, more than two years after the proceeding had been filed. In those circumstances, they submit that the evidence filed by the ACCC does not support, and is inconsistent with, the recommended resale price acting as a minimum price.
5. The primary judge referred on several occasions to "minimum net prices" in the primary judgment but otherwise consistently referred to the benchmarking strategy as using the recommended resale price as a "base or floor price". In describing the strategy, his Honour did not use the language of using the recommended resale price as a "floor or minimum price". We do not consider, however, there is any material or substantive difference between the use of the recommended resale price as a "base or floor price" and its use as a "floor or minimum price". In responding to Mr Ellis' second and fourth to sixth grounds of appeal, we have used the language that Mr Ellis has used in those grounds of "floor or minimum price".
6. The ACCC pleaded the components of the "Benchmarking Strategy" in the FASOC at [23] in the following terms:

The Benchmarking Strategy comprised:

23.1. providing information to Australian Steel Distributors as to proposed prices for Flat Steel Products:

23.1.1. in the form of a suggested or recommended retail price (pricing information):

23.1.2. that would be or were higher than the market price before the implementation of the Benchmarking Strategy;

23.2. persuading Australian Steel Distributors to use the pricing information to set the price at which those distributors would sell Flat Steel Products to Australian Steel Users if BlueScope caused BlueScope-Owned Distributors to price in accordance with the pricing information; and

23.3. causing BlueScope-Owned Distributors to set their prices for Flat Steel Products sold to Australian Steel Distributors and Australian Steel Users in accordance with the pricing information, including by limiting the use and availability of Tactical Pricing.

1. The primary judge accepted at LJ [592] that the benchmarking strategy was not stated clearly in the FASOC.
2. The pleading of the benchmarking strategy does not in terms simply provide for the setting of specific minimum prices. It is more nuanced. It provides for the information as to prices above prevailing market prices to "be used" to set prices for flat steel products if BlueScope caused distributors to price "in accordance" with the pricing information. It does not necessarily follow that if a price is "used" for the purpose of setting a price, or a price is determined "in accordance" with pricing information, the price set by the distributor would be the same as the price proposed under the benchmarking strategy. Rather, the pricing information was contended to be used as a "benchmark" in the sense of a base, as in a standard or a point of reference, for the purpose of determining the price to be set by the distributor.
3. In both its opening and closing submissions at trial, the ACCC more explicitly clarified how the recommended resale price was intended to be used as a benchmark.
4. The ACCC opened its case before the primary judge on the basis that:

... the essence of the ACCCs case is that Jason Ellis was trying to bring about a situation in which he could set a floor price or set a floor for the price of flat steel products in Australia, and the way in which he went about trying to achieve that was by publishing or proposing to publish a price list and proposing to competitors that they should act and price in accordance with that price list. [T 10.28-34]

1. The contention that a distributor should "act and price in accordance" with a price list, in the context of references to an intention of "setting a floor price" or "setting a floor for the price" of flat steel products, is largely indistinguishable from a strategy to set a floor or minimum price for flat steel products. It is necessary, however, to distinguish between the objective of the strategy, that is to "bring about a situation in which he could set a floor price" and the means by which that strategy was to be effected, namely, publishing a price list and proposing to distributors that they "should act and price in accordance" with that price list. As with the pleaded case, a distributor could price "in accordance" with those prices by using them as a "benchmark" in the sense of a base for the purpose of determining their prices. The use of a price list as a benchmark in that sense is consistent with the objective of setting a floor price above the prevailing market price and, if followed by all or substantially all distributors, it could be expected to set a minimum price above the prices prevailing prior to the publication of the price list.
2. The ACCC closed its case on the basis that its case fundamentally remained: [T 1483.12-25]

... that BlueScope and Mr Ellis put a proposal to distributors - and I'm dealing here just with the seven distributors and leaving aside Wright and Yieh Phui for a moment - have put a proposal they would price the steel products in accordance with or at or up to - that is, raising the price up to the list price, and because the bulk or the majority of steel was sold in processed form, which meant that there were processing services that were added on, insofar as there was some additional charge that was levied for the processing services then that - and because the price that was ultimately given to a customer of a distributor was a single price that included both the steel and any amount attributable to the processing services.

The consequence in relation to processed steel would be that, using the list price in the way that the Commission says that BlueScope and Mr Ellis were seeking for distributors to use it, would mean that that would set a floor price in the market.

1. Again, the ACCC maintained the subtle distinction between the end sought to be achieved, the "setting of a floor price", and the means to achieve that, by proposing that distributors price their steel products "in accordance with" or "at or up to, that is, raising the price up to the list price". The strategy was not expressed as simply proposing that distributors price their steel products at the recommended resale price. In that sense, the "floor price" being set would be a floor or minimum price above prevailing prices, but not necessarily at prices that were the same prices as the prices in the CIPA price lists.
2. For these reasons, the contention that the ACCC did not advance a case that the recommended resale price was not in any sense a minimum price cannot be accepted. The ACCC's case as pleaded, and more specifically as opened and closed before the primary judge, did encompass the use of the recommended resale price to achieve a minimum price above prevailing prices.

Distinction between benchmark and floor price or minimum price

1. Mr Ellis contends that the primary judge erred in consistently treating the term "benchmark" as equivalent to a floor price or minimum price. Mr Ellis identifies a number of paragraphs in the LJ which he contends demonstrate that error. By way of example, the first of these paragraphs is at LJ [662], in which the primary judge stated:

The benchmarking strategy could only succeed if a significant number of distributors implemented the strategy by adopting the prices in CIPA's price lists as a benchmark (or floor price) in setting their own prices. Unless the strategy was adopted by a significant number of distributors, those distributors that followed the strategy faced the risk of losing sales to distributors that did not (and offered lower prices). As the evidence below shows, BlueScope promoted the benchmarking strategy widely amongst distributors and also to Wright Steel. As stated above, the evidence shows that, in promoting the benchmarking strategy to distributors, BlueScope made clear that the strategy was being promoted to other distributors in the market. The use of CIPA's price lists as the benchmark (or base) prices and the wide distribution of the price lists were at the core of the benchmarking strategy.

1. As explained above, there is no necessary inconsistency or tension between the use of pricing information as a "benchmark" and the use of pricing information as a floor or minimum price.
2. Further, the price fixing understanding postulated by the ACCC also contemplated that distributors would have retained freedom with respect to prices. The postulated understanding was that distributors would use the CIPA price lists as a base or floor for their pricing of flat steel products, to which they might add additional amounts in respect of processing costs or other costs. The ACCC's case was that the contemplated understanding would be likely to control or maintain prices, not fix prices. It is readily apparent that the primary judge was approaching his consideration of the benchmarking strategy on the basis that the CIPA price lists were to be used by distributors as a "benchmark" in the sense of a "floor price" or a "minimum price", consistently with the manner in which the ACCC had advanced its case. The primary judge correctly recognised that the use of pricing information as a benchmark could, and in the manner contended by the ACCC did, encompass the use of the recommended resale price as a floor or minimum price.

Could the recommended resale price operate as a floor price or minimum?

1. Mr Ellis contends that the recommended resale price could not function as a floor price or a minimum price for distributors for two principal reasons.
2. First, Mr Ellis contends that the recommended resale price could not function as a floor price or a minimum price for distributors because before arriving at a price for their customers, it was necessary to add warehousing, packing, processing, freight and other costs and to apply customer discounts and rebates.
3. The contention is both simplistic and erroneous. The addition of the cost of warehousing, packing, processing, freight and other costs to the recommended resale price enhances, not detracts from, the recommended resale price operating as a floor price or minimum price. Pricing above the recommended resale price would have been entirely consistent, and would have in no way offended, the use of the recommended resale price as a floor price or minimum price. Moreover, to the extent that the counterparties' costs exceeded the recommended resale price, the counterparty could not be expected to price below the recommended resale price and, conversely, if its costs were lower than the recommended resale price, it would have every incentive to price at a level at least equal to the recommended resale price.
4. Next, the application of any customer discounts and rebates could only potentially preclude the RRP strategy from operating as a floor price or minimum price if their quantum exceeded the cost of warehousing, packing, processing, freight and other costs. Then, in turn, if those discounts and rebates did exceed those costs, it does not necessarily follow that the recommended resale price could not operate as a floor price or minimum price because the distributor could reduce those discounts or rebates or otherwise increase its prices, so that the prices that it ultimately set were not below the recommended resale price. In any event, as a practical matter, given the recommended resale price was to be set at a price higher than prevailing prices in order to restore profitability, it might be thought highly unlikely that using the recommended resale price as a benchmark would lead to the imposition of a price that would be lower than the recommended resale price after existing deductions, either by way of a fixed percentage or specific amount, were made to the new higher recommended resale price.
5. Second, Mr Ellis contends that the recommended resale price could not function as a floor price or a minimum price for distributors because of the high level of competition in the market for rolled steel products. He argues that any attempt to induce counterparties to price by reference to the recommended resale price is inherently problematic as distributors require pricing flexibility to respond effectively to competitive pressures.
6. The primary judge considered the contention that the high degree of competition and the prevalence of negotiated prices in the market would make it impossible for the benchmarking strategy to have the effect that the ACCC contended it was intended to have at LJ [631]. His Honour accepted those submissions to an extent, but only insofar as they identified a problem in achieving adherence to the CIPA price lists by way of cartel conduct:

It can be accepted that those features of the distribution market increased the difficulty of engaging in cartel conduct in that market. Generally, a high degree of competition in a market is associated with numerous competitors (a feature of the distribution market), which increases the difficulty of bringing about an arrangement or understanding. So too, a market that is characterised by negotiated prices which are not publicly disclosed increases the difficulty of cartel conduct because the cartel cannot be easily enforced (non-compliance cannot be monitored).

1. But his Honour then reasoned that these market characteristics cut both ways:

However, those features of the distribution market are not a barrier to cartel conduct (far less to attempting to induce cartel conduct). A high degree of competition renders cartel conduct more difficult, but it also creates the commercial incentive to attempt to engage in cartel conduct to increase prices and thereby increase profits (or reduce losses). Negotiated prices make cartel enforcement more difficult, but they create an incentive to reduce competitive pressures by moving toward a common price "benchmark".

1. His Honour then further considered that the same market characteristics would also make it difficult for the benchmarking strategy to function in the way that Mr Ellis claimed it was intended to work:

Mr Ellis's evidence in this respect also suffered from a degree of inconsistency. Mr Ellis repeatedly said that he believed that the benchmarking strategy gave distributors an "opportunity" to price by reference to CIPA's price lists and that he "hoped" that distributors would set their prices on that basis. That "opportunity" required distributors to do the very thing that Mr Ellis said was too difficult because of a high degree of competition and the existence of negotiated prices.

1. We see no error in that line of reasoning. To the contrary, the primary judge's reasoning is compelling. A competitive market can readily be expected to make the reaching of understandings between competitors with respect to prices difficult but at the same time it would provide the impetus or incentive for attempting to induce competitors to reach such understandings. Any perceived impetus or incentive, however, to enter into understandings with competitors to fix, control or maintain prices in markets that are not competitive is much reduced. Suppliers that are not closely constrained in their pricing decisions can price largely independently of their competition and be at much less risk of losing sales and market share.
2. The primary judge squarely addressed the question of whether this component of the evidence supported an innocent intention, or whether it indicated an intention to arrive at a consensus, finding the latter more probable. We agree with that conclusion.

Was a floor price or minimum price supported by findings or evidence?

1. Next, Mr Ellis contends that the finding made by the primary judge that the recommended resale price was to operate as a minimum price is not supported by any findings of fact or evidence. Mr Ellis relies on the following principal contentions to make good that proposition.
2. First, Mr Ellis contends that there is no finding or evidence that he said to any person that the recommended resale price was to be used as a floor price.
3. The ACCC accepts that there was no finding by the primary judge that Mr Ellis said words to the effect to any distributor that the recommended resale price was to be used as a "minimum price" or a "floor price".
4. The absence of any evidence of such statements being made by Mr Ellis does not carry any significant weight. As the primary judge found, Mr Ellis was acutely aware of the sensitivity of the discussions that he was having with distributors with respect to the RRP strategy. In his affidavit evidence Mr Ellis stated that he was conscious in his discussion at the Melbourne Airport Meeting with four distributors, who were competitors, that "it was important to be careful about the topics discussed": LJ [702]. Additionally, in the Yieh Phui meeting, Mr Ellis referred to the topic of the RRP strategy as "maybe a little bit more sensitive" and that he was being "very, very sensitive and very, very careful for the correct ... legal discussion": LJ [1370], [1378]. He also said that he regarded the contents of the report prepared for Mr Vassella "as a sensitive matter": LJ [1411]. Furthermore, in cross-examination, Mr Ellis accepted that he "understood that there was a significant legal risk for competitors in discussing prices": LJ [424].
5. Second, Mr Ellis contends there is no finding that any person understood him to be suggesting the recommended resale price was intended to be used as a floor price or minimum price or base price. That contention cannot be accepted.
6. The primary judge made the following findings that established that BlueScope employees, who had the RRP strategy explained to them, understood that it was seeking to set a base for pricing by distributors:

(a) Mr Hennessy considered that the benchmarking strategy was to encourage distributors "to use CIPA's list prices as a base or floor for their pricing" in order to restore profitability: LJ [871];

(b) by mid-September 2013, Mr Kelso had come to understand that BlueScope was implementing a strategy to set a recommended resale price in the market which would allow distributors "to use CIPA's list price as a base for their pricing": LJ [665]; [747]; [867];

(c) Mr Unicomb explained the RRP strategy to CIPA's senior pricing and sales managers in December 2013 as being to set recommended resale prices in the market for distributors to "use as a base for their pricing": LJ [1445];

(d) Mr Ellis gave a slide presentation on 17 April 2014 to Mr Vassella, in the presence of at least Messrs Palermo, Kari and Nedeski, entitled "CIPA Sales and Marketing FY15 Pricing and Volume Review" that included a slide entitled "Other Pricing Initiative" in which it was stated that the aim of the RRP strategy was to "improve profitability of our Distribution channel customers by attempting to set a price floor for each major product category within the sector": LJ [1248].

1. Mr Hennessy confirmed in his witness statement that although he was not sent the slide presentation at the time it was presented to Mr Vassella, the "Other Pricing Initiative" slide was an accurate summary of the benchmarking strategy: LJ [1250]. The primary judge made findings that distributors did understand that they were being encouraged to price at or above CIPA's list prices. The primary judge found that:

(a) Mr Bolzan of OneSteel had told Mr Kelso that he agreed if the list price could be used as the "rock bottom price", their "business health" would be significantly better going forward, and in that conversation or a later conversation, Mr Kelso explained to Mr Bolzan that the list price was "a baseline or benchmark" that OneSteel could use in pricing products to their end customers: LJ [811];

(b) Mr Gregory of Selection Steel understood that BlueScope's proposal was for distributors to adopt a common position of using the "CIPA list prices" as a "base or floor in setting prices": LJ [1442];

(c) Mr Lobb of CMC understood that the changes to the price list proposed by Mr Ellis effectively created "a headline price that distributors could price to, to increase their profitability" and the proposal "was effectively to raise the market price": LJ [895].

1. Third, Mr Ellis contends there was evidence from each of Mr Ellis, other BlueScope employees (Mr Hennessy and Mr Kelso, who reported to Mr Hennessy) and distributors that is inconsistent with the recommended resale price acting as a floor price or minimum price.
2. The primary judge rejected the evidence of Mr Ellis. He found the evidence given by Mr Ellis on the benchmarking strategy to be inconsistent, lacking credibility, obfuscatory, rehearsed and contrived: LJ [630]-[634]. Those findings are not challenged on appeal.
3. The appellants seek to rely on Mr Hennessy's statement, made in a contemporaneous internal email, that the purpose of the changes to the CIPA price lists was to communicate a recommended resale price "for our Distribution customers to consider when they set their prices for our products to their customers": LJ [1207]. Given Mr Hennessy's statement was proposed to be included on an internal BlueScope social media platform that was widely available within the company, the primary judge concluded that Mr Hennessy's statement, and evidence in cross-examination to similar effect, had to be treated with caution as any description of the RRP strategy "would have been written in careful language and may not disclose the underlying objective of the recommended resale prices". It was a conclusion clearly open for the primary judge to have reached.
4. The appellants contend that Mr Hennessy's evidence as to the need for distributors to have "pricing flexibility" is inconsistent with the recommended resale price acting as a floor or minimum price. They submit that in the majority of cases distributors were not simply resupplying the raw steel product purchased from mills but rather customised packages of the products and additional value-add services, including processing, warehousing and delivery. In those circumstances, they submit that once the additional service costs were factored in, the final price for the overall package could still differ between distributors and between customers.
5. They submit that equally the evidence of Mr Lobb of CMC Steel - that it was not commercially feasible to price at the recommended resale price because of the need for flexibility to meet competition in the market - is inconsistent with the recommended resale price acting as a floor or minimum price.
6. The RRP strategy, as found by the primary judge, however, was not to price at the recommended resale price but rather to use the recommended resale price as a floor or minimum price. Distributors would be free to price above the recommended resale price and at least, to that extent, would retain "pricing flexibility". Mr Lobb gave evidence that CMC Steel would never have agreed or committed to price in accordance with the price list but, consistently with the objective of the RRP strategy, accepted "as a broad concept, a minimum recommended resale price was something that could have been followed": LJ [897].
7. Fourth, Mr Ellis contends the solitary reference in the evidence to the operating as a price floor or minimum price appears in a presentation Mr Ellis gave to Mr Vassella. Mr Ellis contends that the presentation was prepared by Mr Nedeski and Mr Palermo, who were members of BlueScope's finance team (and not the sales team in which Mr Ellis and Mr Hennessy worked).
8. The presentation was titled "CIPA Sales and Marketing FY15 Pricing & Volume Review". It is designated version 2 and is dated 9 April 2014. Toward the end of the document is a slide titled "Other Pricing Initiative" and subtitled "Recommended Resale Price Project - Distribution ... Building market coming" (RRP Slide). The first bullet point in the RRP Slide stated:

A project was undertaken to incorporate the concept of a "Recommended Resale Price (RRP)" into the Distribution Sector.

• Aim was to improve the profitability of our Distribution channel customers by attempting to set a price floor for each major product category within the sector.
• We have not yet measured success but anecdotal feedback has suggested that our Distributors have had some wins.
• The concept is attempting to be expanded into Sheet & Coil Processing, as well as the Building Market rollformers.

1. Mr Ellis contends his involvement in the preparation of the presentation was limited and there is no evidence that he had any input into the RRP Slide. He submits that following an initial meeting that he attended on 7 April 2014 to discuss the proposed presentation, he sent an email to those preparing the presentation with the "key takeaways" that he wanted included but those takeaways did not include any reference to the recommended resale price, let alone it acting as a price floor.
2. The RRP Slide was prepared by Mr Palermo and forwarded to Mr Nedeski and Mr Churchin at 10.37am on 8 April 2014.
3. Mr Ellis first received a copy of the RRP Slide, as part of an updated pack of the 15 slides included in the presentation, at 12.43pm on 8 April 2014. Mr Ellis acknowledged that he had then sent the presentation, including the RRP Slide, to Mr Vassella by email that evening. Mr Ellis gave evidence, however, that he did not make any amendments to the presentation before emailing it to Mr Vassella, he glanced briefly at the presentation but did not recall seeing the "floor price" statement and if he had noticed it, he would have modified it because it was not accurate: LJ [1251].
4. The primary judge did not accept that Mr Ellis was not significantly involved in the preparation of the presentation. His Honour reasoned at LJ [1253]:

I do not accept Mr Ellis's evidence with respect to the correctness of the statement in the presentation concerning the benchmarking strategy. I consider it implausible in all the circumstances. The evidence shows that the presentation had been requested by Mr Ellis's boss, Mr Vassella, and Mr Vassella stated in an email, when requesting the presentation, that he wanted to review it in detail with Mr Ellis. The evidence also shows that Mr Ellis had significant involvement in the preparation of the presentation and was sent additional slides in response to his input. One of those additional slides was the page describing the benchmarking strategy. Mr Ellis reviewed the final form of the presentation before sending it to Mr Vassella in the evening of 8 April 2014. In the email by which Mr Ellis sent the presentation to Mr Vassella, Mr Ellis stated that the presentation included "Recommended Resale pricing - Distribution and Building Markets", which was the subtitle of the page that contained the description of the benchmarking strategy. Mr Ellis then presented the presentation to Mr Vassella on 17 April 2014, in the presence of Messrs Palermo, Kari and Nedeski, and the presentation lasted an hour. Although Mr Ellis denied that he read the presentation carefully, I do not accept that denial in circumstances where Mr Ellis was responsible for the presentation and in fact presented it. Further, if the statement in the presentation concerning the benchmarking strategy was inaccurate, one or more of the persons present at the presentation would have identified the statement as being inaccurate. No evidence was given by Mr Ellis to that effect.

1. The reasoning of the primary judge was compelling and persuasive. His Honour was entitled to reason in this manner. No error on the part of the primary judge has been established in relation to this matter.
2. Fifth, Mr Ellis contends that none of the 16 matters identified by the primary judge at LJ [1438]-[1453] support a finding that, by the benchmarking strategy, Mr Ellis intended to induce an understanding in which the recommended resale price would be adopted by distributors as a minimum price. For the reasons advanced at [228]-[310] above, no error has been established in the primary judge's reliance on those matters.
3. It follows that ground 4 in Mr Ellis' appeal must fail.

Ellis ground 2: Capability of acting as an understanding for the purposes of s 44ZZRJ

1. Ground 2 is advanced by Mr Ellis in the alternative to grounds 1 and 4. As explained above, the primary basis on which Mr Ellis challenges the decision of the primary judge is that his Honour erroneously found that the recommended resale price was a floor price or minimum price and was not a price around which an understanding could cohere. Mr Ellis contends that if that proposition is not accepted then an understanding alleged to provide for a price around which prices could cohere is merely an understanding to increase prices falling outside s 44ZZRJ.
2. The distinction sought to be drawn between ground 2 and ground 4 is inapposite and does not accurately reflect the findings made by the primary judge. As explained above, the primary judge did not find that the recommended resale price was simply a starting point or a price around which pricing could cohere in the sense of being above or below the recommended resale price.
3. By ground 2, Mr Ellis contends that the primary judge erred in finding that understandings with the following features were capable of amounting to an understanding for the purposes of s 44ZZRJ:

(a) an understanding between BlueScope and distributors pursuant to which strict adherence with the recommended resale price as a base or floor price was not required and the recommended resale price was a price level around which an understanding could cohere;

(b) an understanding between BlueScope and Wright Steel pursuant to which Wright Steel could sell flat steel products to distributors at increased prices by reference to the recommended resale price;

(c) an understanding between BlueScope and Yieh Phui which contemplated that Yieh Phui would sell flat steel products to import traders at a higher price than it was currently doing by reference to the recommended resale price.

1. Ground 2(a) is directed at the finding that an understanding in which the recommended resale price was proposed as a price around which an understanding could cohere, and strict adherence to the recommended resale price as a base or floor price was not required, can fall within s 44ZZRJ.
2. In contrast, grounds 2(b) and (c) are directed at the more specific findings that understandings which only contemplate increased or higher prices, albeit by reference to the recommended resale price, could constitute understandings for the purposes of s 44ZZRJ.

Can there be an understanding without strict adherence to a base or floor price?

Having regard to the whole of the evidence, I am satisfied that the respondents intended to induce a consensus or meeting of minds, being an understanding within the meaning of the Act. The consensus was for distributors to use the list prices in CIPA's Distribution Market price lists for flat steel products as a base or floor price for their supply of flat steel products. I do not consider that the understanding that was sought to be induced was intended to be adopted by distributors in an absolute manner, requiring strict adherence to CIPA's price lists as a base or floor price. Rather, the understanding that was sought to be induced was a more general adherence to a principal that distribution prices should be increased to the level of CIPA's price lists by way of a floor. CIPA's price lists provided a clear price level around which the understanding could cohere.

1. Mr Ellis contends that it is not at all clear what the primary judge's finding at LJ [1454] - that the recommended resale price was not a strict minimum for the seven distributors, but a price around which an understanding could cohere - means. In particular, he argues it is not clear in what circumstances a party could complain that another party was not acting in accordance with such an understanding.
2. The only reference that the primary judge made to the use of the recommended resale price as a price level around which the understanding "could cohere" was at LJ [1454]. It is important to construe that phrase in the context of both the paragraph in which it appears and the judgment as a whole. It seems plain that the primary judge at LJ [1454] was drawing a distinction between, on the one hand, pricing at the exact levels in the CIPA price lists, that is by pricing in an "absolute manner" and through "strict adherence" to the price lists, and on the other hand, increasing prices to the level of the CIPA price lists as a minimum, by way of a floor, that is by a "more general adherence to principle". Understood in that context, pricing by reference to a more general adherence to a principle can be seen to be consistent with the CIPA price lists performing the function of providing a clear price level "around which the understanding could cohere". Textually, to "cohere around" means a "coming together in a meaningful way" or "to operate effectively". Read fairly, and in context, the primary judge was not stating or implying that the understanding sought to be induced by the appellants was merely pricing around, as in above or below, the CIPA price lists. Rather, as the primary judge stated in the penultimate sentence of LJ [1454], the understanding that his Honour found that was sought to be induced was "a more general adherence to a principle that distribution prices should be increased to the level of CIPA's price lists by way of a floor".
3. Further, Mr Ellis contends that the use of the recommended resale price as a price around which prices can "cohere" could not relevantly constitute an understanding in the context of the following findings of the primary judge: (a) prices to distributors were constantly changing, at least on a monthly basis (LJ [482]-[483]), (b) costs for processing and freight needed to be added to the recommended resale price and discounts and rebates would need to be deducted (LJ [455], [469]), and (c) the market for rolled steel was highly competitive, products and services offered were essentially homogenous and there was significant industry-wide overcapacity in the market (LJ [387]-[389]). Mr Ellis argues that there is no authority to support the proposition that it is possible to have an understanding for the purposes of s 44ZZRJ around, what is, in effect, a moving target, such as the recommended resale price, to which both costs must be added and discounts applied.
4. These contentions cannot be accepted.
5. The purpose/effect condition in s 44ZZRD(2) is relevantly satisfied if the impugned understandings, the subject of the attempts to induce the counterparties to reach, had the purpose or likely effect of "fixing, controlling or maintaining" the "price for" the supply of goods. The case advanced by the ACCC and accepted by the primary judge was that the appellants were attempting to induce an understanding that had the purpose of controlling or maintaining, not fixing, the price for flat steel products.
6. In CC (NSW) at [168]-[169], Lindgren J stated:

The word "control" is not defined in the Act. Its natural or ordinary meaning is "to exercise restraint or direction over" (the Macquarie Dictionary) or "to exercise restraint or direction upon the free action of" (the Oxford English Dictionary) a person or thing. There are degrees of control and there may be control although the "restraint" or "direction" is not total. An arrangement or understanding has the effect of "controlling price" if it restrains a freedom that would otherwise exist as to a price to be charged.

Concretes submits that the notion of "fixing, controlling or maintaining" price involves a degree of "specificity" as to price and a degree of "proximity" between the arrangement or understanding and price. I accept that an arrangement or understanding which no one intends, and is not objectively likely, to have any effect on price, but which, by reason of unforeseeable supervening circumstances has had that effect, is not caught. But, with respect, I do not find the general proposition relied on by Concretes determinative of the present case. Of course, I accept that "likelihood" is to be assessed as at the time when the arrangement is made or the understanding is arrived at.

1. The impugned arrangement or understanding in CC (NSW) was reached at a meeting between four construction contractors who had tendered to undertake the construction of a project in Haymarket in Sydney. The arrangement or understanding that was found to have been reached at the meeting was that if its tender were accepted, the successful tenderer would pay each of the three unsuccessful tenderers the sum of $750,000 from "the proceeds of the job". In framing its tender, each tenderer would take into account its obligation to make these payments and would not disclose the existence of the "undisclosed tender fee" to the company awarding the contract for the construction of the project: CC (NSW) at [23]-[24].
2. The impugned arrangement or understanding did not mandate or require any tenderer to submit any particular price. Indeed, it was considered that, while each tenderer had independent expectations that the other tenderers would take into account their obligations to pay the unsuccessful tenders fee when calculating their tender prices, that did not form part of the understanding: CC (NSW) at [160], [162]. Each tenderer was free to submit their own price for the tender but in determining that price they would have to have regard to the need to pay $750,000 to each of the three unsuccessful tenderers.
3. At that time, s 45A of the then TPA (now renamed and recast as the Competition and Consumer Act) relevantly provided that, without limiting the generality of s 45, a provision of an arrangement or understanding was deemed for the purposes of s 45 to have the purpose, or to have or to be likely to have the effect, of substantially lessening competition, if the provision had the purpose, or had or was likely to have the effect, as the case may be, of fixing, controlling or maintaining the price for goods or services to be supplied by the parties or by any of them in competition with each other.
4. In that context, Lindgren J stated at [176]-[178]:

I do not think that some specificity as to price is a necessary element of the notion of "controlling" price within s45A. To insist on such a requirement would be to introduce an unauthorised general limitation on the notion and would allow the statutory prohibition to be easily circumvented - a result that cannot have been intended and should not be lightly accepted.

On the assumption in favour of Concretes that the concept of controlling price involves a degree of proximity between the arrangement or understanding and the price charged or to be charged, in my view that requirement is satisfied in the present case, even though the UTF understanding did not encompass some of the elements contended for by the Commission. True, the UTF understanding was, but was no more than, that the successful Tenderer would pay a UTF of $750,000 to each of the three unsuccessful Tenderers. But the question that arises is simply the factual one whether, on the evidence, that limited understanding was likely as at the time of the Meeting to have the effect of controlling the price to be charged to ACS. In my opinion, on the evidence before me and for reasons mentioned later, it was, and, if it should be relevant, the Tenderers understood that it was.

Concretes also submits that because the supposed UTF understanding left the Tenderers with a great deal of freedom as to the price which they would charge, it did not have the effect of controlling price competition and therefore did not fall within the terms of s45A. It seems to me, however, that putting to one side de minimis cases, the degree of control, although relevant to penalty, is not relevant to the issue of contravention. I do not consider the degree of control here to have been de minimis.

1. In Australian Competition and Consumer Commission v PT Garuda Indonesia Ltd [2016] FCAFC 42; 244 FCR 190, after referring to the statements by Lindgren J in CC (NSW) at [178], Dowsett and Edelman JJ stated at [555]:

In Australian Competition and Consumer Commission v Australian Medical Association Western Australia Branch Inc [2003] FCA 686 ; (2003) 199 ALR 423 at 461-462 [193]-[195] Carr J appears to have disagreed with the proposition that the degree of control is relevant only to penalty. The disagreement may simply disclose different views as to the meaning of the protean term "de minimis". It is clear, however, that total control is not necessary. It is also clear that there may be price-fixing in the absence of agreement as to the precise price (see Trade Practices Commission v Parkfield Operations Pty Ltd, above, and Trade Practices Commission v Service Station Association Ltd (1992) ATPR 41-179 ; (1992) 109 ALR 465 (Heerey J) at first instance and, on appeal see Trade Practices Commission v Service Station Association Ltd [1993] ATPR 41-260 ; [1993] FCA 405; (1993) 44 FCR 206, 228 per Lockhart J (Spender and Lee JJ concurring)).

1. Mr Ellis contends that PT Garuda is distinguishable on the basis that the relevant surcharges would always make the price for the carriage of air freight higher because the surcharges would be fixed and therefore necessarily control the final price.
2. Mr Ellis argues that the position in this case more closely resembles the price fixing case advanced in Australian Competition and Consumer Commission v Olex Australia Proprietary Limited [2017] FCA 222. Mr Ellis seeks to rely, in particular, on the following reasoning by Beach J at [655]-[657]:

As to the alternative assertion that the cutting fee provision had the purpose or a substantial purpose and/or likely effect of controlling the price of electrical cable supplied by the Manufacturers, the evidence does not support the allegation. The cutting fees were a modest component of the overall price of electrical cable. As such, there was no commercially realistic ability to control the price of electrical cable by controlling the price charged for cutting services. Moncrieff's evidence was that Olex had to compete on the total price/service package offered to its customers. Moreover, the price of cable supplied by the Manufacturers was not visible to each other. Accordingly, there was no means by which they could assess whether the overall price of cable including cutting fees increased or decreased over time. The ACCC's case on this aspect lacked commerciality.

There was no evidence adduced to suggest that the purpose was to control the price of cut cable, which is a composite. There was no restraint on either Olex or Prysmian in the amount it charged overall for cut cable. The only restraint, assuming in favour of the ACCC that there was a consensus, was that an item appeared in a bill for $85 for each cut. But it was not in doubt that customers bought by reference to the overall price.

Generally, more needs to be shown than merely that a provision has the likely effect of controlling a component of the price. It must have the likely effect of controlling the overall price, ie be a materially significant proportion of the price. Competition occurs for the total price of the cut cable. There was no evidence of discussions between any of the Wholesalers or Manufacturers of a commitment to exercise control over the price of cut cable.

1. The reasoning of Beach J in Olex at [655]-[657] does not assist the appellants. Unlike the quantum and transparency of the recommended resale price in the present case, the cutting fees were only a modest component of the overall price of electrical cable, the manufacturers had no visibility as to the price of the cable supplied by other manufacturers, and the manufacturers could not assess whether the overall price of cable, including cutting fees, increased or decreased over time. Moreover, no evidence was adduced in Olex, unlike in the present case, that the purpose was to control the price of the products in issue. It was in that context, that Beach J concluded that more needs to be established than merely that a provision had the likely effect of controlling a component of price. Further, as the Full Court determined in PT Garuda, controlling a component of an overall price is sufficient, it is not necessary to establish that it is a "materially significant proportion of the price".
2. Unlike in PT Garuda, the attempt to control the price of the products or services found by the primary judge was not by way of a fixed price over a specific component of a final overall price, but was no less a control over the price of rolled steel products. The control in this case was found to be the attempt to induce the counterparties to use the recommended resale price as a floor or minimum price for the overall price of rolled steel products. Such a finding was not only open to the primary judge but plainly consistent with the reasoning both in CC NSW, that freedom as to the price which would ultimately be charged was not antithetical to a price fixing arrangement or understanding, and in PT Garuda that there may be price-fixing in the absence of agreement as to the precise price.

1. Mr Ellis advances two principal contentions in support of grounds 2(b) and (c).
2. First, Mr Ellis contends that the attempts to induce the understandings with Wright Steel/Citic and Yieh Phui, the subject of grounds 2(b) and (c) respectively, are even more problematic than the attempts to induce understandings with distributors because the proposition that one can have an understanding simply to increase prices or increase margins is directly contrary to authority, at least in the circumstances of this case.
3. Mr Ellis argues, citing the reasoning of Heerey J in Trade Practices Commission v Service Station Association Limited (1992) 109 ALR 465 at 483, that a general understanding to sell at increased prices could not operate to control or maintain prices because it remained necessary for counterparties to add both costs and discounts, and their price might therefore ultimately be higher or lower than the recommended resale price, if it were adopted as a benchmark. They seek to rely, in particular, on the following statement by Heerey J at 483:

...a general arrangement or understanding merely to increase margins over those existing at some previous period could not in my view conceivably constitute an arrangement or understanding to fix, control or maintain prices

1. The appellants also refer to the finding by Heerey J that a more specific alleged arrangement to increase prices "in the order of 10%" or "approximately 6.5 cents a litre", had "obvious problems" because it "may lack the degree of certainty inherent in the concept of fixing, controlling or maintaining prices" (at 483-484).
2. The reliance sought to be placed by the appellants on these statements and findings of Heerey J again illustrates the inherent danger in taking statements expressed in relatively general terms and applying them in fundamentally different factual circumstances.
3. Unlike in the present case, the alleged arrangement or understanding in Service Station concerned recommended resale prices published by an industry association, Service Station Association Limited (SSA), for the benefit of its members, who were petrol retailers in New South Wales. Discussions of pricing and profitability between an industry association and its members on the one hand, and discussions of pricing and profitability between competitors on the other hand, raise very different competition concerns.
4. Further, and significantly, Heerey J concluded at 485:

The only real attempt of the TPC to erect an arrangement or understanding from direct evidence was its reliance on the arrangement in Mr Bailey's group at the first Forestville RSL meeting that he would ascertain the SSA recommended retail price from time to time and pass it on. To my mind that is not inconsistent with this small group simply agreeing that Mr Bailey would, as a matter of convenience, do on their behalf what they could equally do themselves; that is, obtain the recommended price from the SSA. What they did when they got that price, and whether they followed it wholly or partly, was to remain a matter for each individual without obligations to other members of the group or other members of the SSA or the SSA itself.

1. It was in the context of that finding that Heerey J concluded that there was an absence of any evidence of mutual promises or undertakings as between dealers, and as between dealers and the SSA, and the communications from the SSA did not "urge such mutual binding of dealers between themselves". To the contrary, the "explicit and repeated message is that dealers have to make their own decisions with the consequence (again specifically stated) that differing prices will often be charged".
2. Statements made by an industry association to its members in connection with the circulation of recommended resale prices about the need to make their own decisions on pricing is factually distinct from a situation, as in the present context, where a firm is telling its competitors that they remain free to set their own prices in the context of a foreshadowed provision of a recommended resale price. Absent some price fixing arrangement or understanding, it is axiomatic and self-evident that competitors can set their own prices. Unlike an industry association, it is difficult to conceive of any circumstances in which a firm would consider that it was necessary to tell its competitors that they were "always free to set their own prices" independently of communications in which the firm was discussing or advancing pricing proposals intended to improve mutual profitability. Certainly, any attempt to rely on statements between competitors to that effect as providing an antidote or elixir to claims of price fixing would elevate form over substance and emasculate the price fixing prohibitions in the Act. The primary judge, with respect, was justified in giving no substantive weight to such protestations by the appellants in their communications with counterparties, including Wright Steel and importantly, Yieh Phui, as considered further below at [489] - [491].
3. Second, Mr Ellis contends that there is no sense in which the recommended resale price could operate as a floor or minimum price for Wright Steel or Yieh Phui. He submits that the flat steel products supplied by BSL CIPA generally traded at a premium to imported products and therefore, the recommended resale price would be higher than the price for equivalent Yieh Phui products. He submits that insofar as Yieh Phui was making pricing decisions, it was doing so at a different functional level - that is, the price at which Yieh Phui would supply flat steel products to Wright Steel; not the price to be charged to the customers of distributors.
4. Mr Ellis submits that, given Yieh Phui was selling to its import trader Wright Steel, who was in turn selling to distributors, Yieh Phui would need to make certain assumptions in order to make any use of the recommended resale price. These assumptions would include the margin applied by Wright Steel when on-selling to distributors, as well as the margins applied by distributors when selling the rolled steel to end customers.
5. The primary judge found that that the conduct of the appellants relied upon by the ACCC with respect to Wright Steel and/or Citic constituted steps towards the inducement of an understanding being reached between BlueScope and Wright Steel and/or Citic containing the following cartel provisions (at LJ [1530]):

(a) Wright Steel and/or Citic would sell flat steel products to distributors in Australia at increased prices by reference to CIPA's Distribution Market price lists; and

(b) BlueScope CIPA and NZSA would sell flat steel products to distributors in Australia at increased prices by reference to CIPA's Distribution Market price lists.

1. The primary judge concluded that the proposal made by the appellants to Wright Steel and/or Citic was capable of assent and the inducement offered by the appellants was that CIPA and NZSA would be increasing their prices and the threat that, if import traders did not increase prices, BlueScope would initiate anti-dumping complaints against the imported products (at LJ [1533]).
2. The primary judge found at LJ [1540] that that the conduct of the appellants relied upon by the ACCC with respect to Yieh Phui constituted steps towards the inducement of an understanding being reached between BlueScope and Yieh Phui containing a cartel provision (at LJ [1540]):

that Yieh Phui would sell flat steel products to import traders at a higher price than it was doing at the time of the Yieh Phui meeting by reference to CIPA's Distribution Market price lists.

1. The primary judge concluded that the proposal made by the appellants to Yieh Phui was capable of assent and the following inducements were offered by the appellants (at LJ [1544]):
2. First, Mr Ellis stated that when BlueScope set the recommended resale price, it established a market norm. The statement was an implicit promise that BlueScope would support the price increases reflected in its price lists. Second, Mr Ellis referred to the likelihood of anti-dumping action against low priced imports from Vietnam and India, which constituted a threat of such action against any imports at low prices. Third, the totality of Mr Ellis' statements to Yieh Phui were in the nature of persuasive arguments for Yieh Phui to increase its prices, which is sufficient to constitute an attempt to induce an understanding.
3. The understandings that the primary judge found the appellants had attempted to induce with Wright Steel and Yieh Phui were less specific than those contemplated with the distributors but on no view were they simply proposals to increase prices. The primary judge concluded at LJ [1455]:

The contemplated understanding was that Wright Steel and Yieh Phui would increase their prices at the manufacture/import level of the market in recognition that distributors would increase their prices to the level of CIPA's price lists by way of a floor. No particular level of pricing at the manufacture/import level of the market was proposed by BlueScope to either Wright Steel or Yieh Phui.

1. The proposal to increase prices was not at large but inextricably linked to increases that would enable distributors to increase their prices to the recommended resale price by way of a floor. Yieh Phui and Wright Steel may have been operating at different functional levels to distributors, but it does not necessarily follow that each of them did not have reasonable visibility as to prices being charged by distributors to their customers, and in particular, whether they were at or above the recommended resale price. The finding by the primary judge that no particular level of pricing at the manufacture/import level was proposed does not carry with it any implication that the understandings that the appellants were attempting to induce Wright Steel and/or Citic and Yieh Phui to enter into could not contain a cartel provision.
2. Ultimately, the primary judge was satisfied that inducing a counterparty to price "by reference" to the recommended resale price was sufficient in the case of Wright Steel/Citic and Yieh Phui to constitute an inducement to reach an understanding containing a cartel provision because it was capable of controlling the prices that Yieh Phui (as an overseas manufacturer), would charge to Wright Steel/Citic (as importer traders) and that Wright Steel/Citic would charge to distributors: LJ [1531] and [1535], LJ [1540] and [1546].
3. It was a conclusion that was open to the primary judge. Pricing by reference to a benchmark was less direct than using a benchmark as a floor or minimum price. Nevertheless, it was capable of providing an objective basis by which prices could be adjusted to reflect the recommended resale price ultimately to be charged by distributors to their customers.
4. It follows that ground 2 in Mr Ellis' appeal must fail.

1. By ground 5, Mr Ellis contends that the primary judge erred in finding that, in deciding whether conduct is sufficiently proximate to amount to an attempt to induce an understanding containing a cartel provision, the critical fact is that a proposal is made by that person that is capable of assent.
2. Mr Ellis advances two specific contentions in support of this ground.
3. First, Mr Ellis contends that in assessing the conduct element of an attempt to induce entry into a proscribed understanding, it is not sufficient that a statement may be made to a counterparty who "might express assent". He argues, by way of example, that a suggestion to a competitor that it would be a good idea to increase prices, might be capable of assent in that the competitor could indicate that they agreed it would be a good idea to do so and subsequently increased their prices, but that would not constitute an attempt to induce an understanding.
4. A proposal which is not capable of being the subject of any assent clearly could not relevantly give rise to an understanding for the purposes of s 44ZZRJ. The more relevant and critical issue is the necessity to distinguish between a compelling argument to increase prices unilaterally and a compelling argument to enter an understanding to do so. The former may be capable of assent but would be unlikely to be sufficient in itself to constitute an attempt to induce an understanding.
5. The distinction between a mere proposal to increase prices and a proposal to enter an understanding to increase prices was recognised by the primary judge at LJ [96], in which his Honour stated:

The respondents drew a distinction between persuading a competitor to increase their price and persuading a competitor to arrive at an understanding containing a provision that they will increase their price. The respondents argued that conduct in the first category is lawful while conduct in the second is unlawful. The distinction can be accepted in theory but is likely to be a fine one in practice. For example, if competitor A says to competitor B that competitor B should increase its prices because they are unprofitable, that might be characterised as mere persuasion (in the form of a persuasive argument) to increase prices and may not involve an inducement to reach an understanding and a contravention of the law. An illustration of such conduct is given by the findings in Trade Practices Commission v Service Station Association Ltd (1992) 109 ALR 465 (Service Station Association) (see at 488 per Heerey J) (upheld on appeal in Trade Practices Commission v Service Station Association Ltd [1993] FCA 405; (1993) 44 FCR 206 (Service Station Association (Full Court)) at 224-225, 238 per Lockhart J, Spender and Lee JJ agreeing). However, an added statement that competitor A is intending to do likewise may, in appropriate circumstances, be characterised as an attempt to persuade competitor B to arrive at an understanding to increase prices. Further, as Heerey J observed in that case (at 488), the objective likelihood of particular conduct producing a particular result (viz, arrive at an understanding) is relevant to ascertaining what was intended by the conduct (referring to the observations of Windeyer J in Vallance v The Queen [1961] HCA 42; (1961) 108 CLR 56 at 82).

(Emphasis in original.)

1. It was certainly open to the primary judge to characterise the element in those terms. Moreover, on no view did the primary judge proceed on the basis that finding that a proposal was capable of assent was sufficient to establish the existence of an understanding. No error has been demonstrated.
2. Second, Mr Ellis contends that in any event the statements made by the appellants to the counterparties were not capable of assent. He argues that because prices required the addition and subtraction of various components that varied constantly over time, it was not possible to speak sensibly about an increased price.
3. The error in that contention is that it proceeds on the flawed assumption that the statements made by the appellants were relevantly limited to an inducement to increase prices. For the reasons explained above, the inducements found by the primary judge travelled substantively beyond such a statement. The recommended resale price was not a static or inflexible price nor was the use of the recommended resale price a simple exhortation to increase prices. The use of the recommended resale price as a benchmark in the sense of a minimum or floor price provided a flexible mechanism by which counterparties could price rolled steel products, after taking into account any addition or subtraction of "various components". Any ultimate pricing above the recommended resale price that took place was consistent with the use of the recommended resale price as a minimum or floor price. Further, as explained above, any existing rebates or discounts offered by the counterparties to their customers prior to the use of the recommended resale price, given the highly competitive market for rolled steel, could be expected to be revisited if the recommended resale price was adopted as a relevant benchmark to set floor or minimum prices.
4. Mr Ellis also contends that this difficulty cannot be overcome by simply saying that the increased price may be formulated "by reference to" the recommended resale price (LJ [1546]). He submits the following hypothetical, by way of example: let it be assumed that, at the date of the meeting that Mr Ellis attended with Yieh Phui on 26 February 2014, Yieh Phui was selling a flat steel product for $1,500 per tonne and the recommended resale price was $2,000 per tonne; and that by 26 March 2014, BlueScope's recommended resale price had changed to $1,800 per tonne. Mr Ellis submits that if Yieh Phui had expressed assent to a proposal to increase price by reference to the recommended resale price on 26 February 2014, it is impossible to say what that means for Yieh Phui pricing as at 26 March 2014.
5. The flaw in this contention is that the proposed understanding sought to be induced with Yieh Phui pursuant to the overseas mill strategy was not to price by reference to the recommended resale price as at 26 February 2014, rather it was to price by reference to the recommended resale price generally. In the example advanced by Mr Ellis, as and from 26 March 2014, if Yieh Phui were to price "by reference" to the recommended resale price, Yieh Phui could then make a similar 10% reduction in the price that they were selling flat steel products from $1,500 per tonne to $1,350 per tonne. The example, however, propounded by Mr Ellis was perhaps a little contrived because the clear implication of the recommended resale price was to increase, not decrease, the price for rolled steel products. Yieh Phui could be expected to have the benefit of increased prices for its rolled steel products, not decreased prices.
6. The relevant assent being sought was not to charge specific prices for rolled steel products. Rather, in the case of the distributors it was an assent to the use of the recommended resale price as a floor or minimum price in setting their prices and in the case of Wright Steel/Citic and Yieh Phui to use the recommended resale price as a reference point in setting manufacturing/import prices.
7. It follows that ground 5 in Mr Ellis' appeal must fail.

Ellis ground 6: Conduct not sufficiently proximate

1. By ground 6, Mr Ellis contends that the primary judge erred:

(a) to the extent that his Honour concluded that Mr Ellis impliedly or indirectly sought a commitment from the seven distributors, Wright Steel and Citic;

(b) having found that Mr Ellis said to Yieh Phui that everything he said had been practised maybe 20 times before, in failing to find that Mr Ellis had practiced what he had said to Yieh Phui in previous meetings with distributors and Wright Steel, and in failing to make any finding as to what was meant by those words;

(c) in failing to find that the words used by Mr Ellis in the meeting with Yieh Phui, and in previous meetings with the distributors and Wright Steel, were inconsistent with an attempt to induce the alleged understanding.

1. In relation to (a), the primary judge did not make any explicit finding that Mr Ellis impliedly or indirectly sought a commitment from the distributors or Wright Steel/Citic. The paragraphs in the primary judgment relied upon by Mr Ellis in his notice of appeal as containing a finding by the primary judge to that effect do not establish that such a finding was made. Rather, the findings made by the primary judge in those paragraphs do not rise above findings that "neither Mr Ellis nor Mr Hennessy directly sought a commitment" (LJ [712] and [718]), "neither Mr Ellis nor Mr Hennessy sought a commitment" (LJ [730]) and references to submissions made by the appellants that no commitment was sought by BlueScope (LJ [1420]). The primary judge's finding at LJ [712] that it was "probable that Mr Hennessy communicated either expressly or implicitly that BSD and SMS would set their prices in accordance with CIPA's list prices" to those present at the Melbourne Airport meeting may well have been an incentive for those present at the meeting to embrace the benchmarking strategy but it was not an explicit finding that Mr Ellis had impliedly or indirectly sought a commitment from those distributors present at the meeting.
2. The contention was not further developed by Mr Ellis in his written or oral submissions on appeal.
3. The primary judge did not make such a finding. It necessarily follows that no error has been established.

1. In relation to (b), the primary judge addressed the "practised maybe 20 times before" reference in the transcript of the meeting that Mr Ellis attended with Yieh Phui in the following terms in the LJ:

[1395] The above statement was followed by some brief laughter and then a longer conversation in Mandarin ensued involving a number of participants. At the end of that conversation, Mr Huang said (at page 21 of the transcript):

Yeah, yeah, so that's why we focus on the spirit of the ACCC. You know, it's a competitive market without any artificial restriction, so I guess this question is so sensitive, so that's why we - we - okay, we - you know, at least nobody can bear 10 million of the - the fine or - or 10 years in - in gaol.

[1396] Mr Ellis interjected (at page 21 of the transcript):

I think you are confusing the conversation. I have been very careful with my words to make this, ah, very, very, ah, ah - very, ah, ah, legal and very allowable. So everything I've said today has been practised maybe 20 times before.

[1397] That statement was again followed by laughter. Mr Ellis continued:

So, please, Robert, no, no, no, no - no concern, no. So again, I just reiterate we are, ah, we're not suggesting anything. Ah, we are not, ah, recommending any pricing setting or anything like that. All we are saying is there - there is publicly available information which you can access, which should enable YP to extract more value from the Australia market. What you do is up to you. So, ah, we - we are very comfortable for that.

1. Ultimately the primary judge concluded at LJ [1404(h)]:

Eighth, Mr Ellis stated during the course of the discussion that he had received legal advice about the subject of the discussion, that his lawyer had given him "very strict instructions", that he was being very careful with his words, and that everything Mr Ellis said had been practised maybe 20 times before. Those statements were generally followed by laughter in the room. It is apparent from listening to the recording that those statements were understood by those present as indicating that, under legal advice, Mr Ellis was using careful language in what he was seeking to convey. Further, given Yieh Phui's repeated objections to the subject matter being discussed at all, I infer that Yieh Phui understood that Mr Ellis was seeking to persuade Yieh Phui to increase its prices into the Australian market. I also find that that was Mr Ellis's intention.

1. The primary judge had earlier rejected Mr Ellis' evidence that the "maybe 20 times before" was a reference to using the same form of words on the many occasions in previous meetings that he had attended with distributors, finding at LJ [333(a)]:

In his affidavit, Mr Ellis proffered an explanation of a comment that he had made in his meeting with Yieh Phui that his statements in the meeting had "been practised maybe 20 times before". Mr Ellis deposed that he was referring to the fact that he had met with distributors on numerous separate occasions and had said something to similar effect to that which he said in the meeting with Yieh Phui (being an explanation of BlueScope's recommended resale prices). In support of that evidence, Mr Ellis included a list of 26 meetings he had attended between 27 August 2013 and 26 February 2014 with distributors in Annexure A to his affidavit. In cross-examination, Mr Ellis agreed that the list in Annexure A had been prepared and included in the affidavit to support his evidence concerning statements made in meetings with distributors. However, when pressed, Mr Ellis accepted that that was not true, and that nine out of the 26 meetings listed in the annexure were not meetings in which the RRP strategy was discussed. Mr Ellis then attempted to explain the inconsistency by suggesting that he had made a mistake when preparing the annexure and had listed all meetings that he had held with distributors in the period. When pressed again, Mr Ellis conceded that the annexure did not contain a list of all such meetings. I find that the annexure represented a deliberate distortion of the truth for the purpose of bolstering Mr Ellis's evidence concerning the comment that he had made in the meeting with Yieh Phui.

1. The appellants contend that given the primary judge's findings that Mr Ellis attended 17 meetings with distributors in which the RRP strategy was discussed, his Honour should have found that the statement made by Mr Ellis during the meeting with Yieh Phui that he had "practised everything he had said maybe 20 times before" strongly supported a finding that Mr Ellis had used similar language, whatever the precise number, to what he used in the Yieh Phui meeting in his 17 meetings with distributors and Wright Steel.
2. Mr Ellis contends that the range of likely meanings of the words that he had "practised everything he had said maybe 20 times before" was limited to practising it in "front of a mirror 20 times" or practised it "20 times with other third parties", and "plainly it means the latter" [T 119.4-5]. Mr Ellis argues that the words that he used in the meeting with Yieh Phui are inconsistent with attempting to induce an understanding and inconsistent with a recommended resale price operating as a minimum price. Mr Ellis submits that the transcript of the Yieh Phui meeting makes clear that he was trying to communicate to Yieh Phui using a standard form of words, that were inconsistent with attempting to induce an understanding. He submits that the transcript shows that he was "proceeding with great care entering this meeting. He is conscious of limits. He is conscious of legalities" [T 119.30-34]. That is, he was providing information in "a legally acceptable format".
3. The primary judge's decision not to make any specific finding as to what the "practised everything he had said maybe 20 times before" statement meant cannot give rise to any relevant error. His Honour, however, did directly address the purportedly exculpatory language that Mr Ellis was using in the Yieh Phui meeting, concluding in the following portion from LJ [1404(h)] reproduced above at [482]:

... It is apparent from listening to the recording that those statements were understood by those present as indicating that, under legal advice, Mr Ellis was using careful language in what he was seeking to convey. Further, given Yieh Phui's repeated objections to the subject matter being discussed at all, I infer that Yieh Phui understood that Mr Ellis was seeking to persuade Yieh Phui to increase its prices into the Australian market. I also find that that was Mr Ellis's intention.

1. The primary judge's general rejection of Mr Ellis' evidence and, in particular, his unchallenged finding at LJ [330(a)] make plain that he placed no reliance on the evidence of Mr Ellis that the reference to "20 times before" was to meetings that had he had attended on numerous separate occasions with the distributors and Wright Steel in which he had provided similar explanations in the course of explaining the benchmarking strategy. Given the transcript produced from the audio recording made by Yieh Phui of the meeting, it was common ground that the words were said by Mr Ellis. The transcript, however, cannot establish the truth of what Mr Ellis was asserting, that is, whether he had in fact done what he represented to Yieh Phui that he had done, nor equally significantly, the specific circumstances in which he had previously made those statements. In effect, the primary judge is being criticised for not drawing an inference in the absence of any sound evidentiary foundation, which must be rejected.
2. Nor, given the more specific nature of the understandings that the primary judge found the appellants attempted to induce with the distributors, is it apparent how his Honour could have drawn any inference that Mr Ellis would have provided an explanation of the benchmarking strategy in the same terms as the explanation that he provided to distributors and Wright Steel as he provided to Yieh Phui in the context of the related, but distinct, overseas mill strategy.
3. In relation to the contention outlined at [477(c)], even if the primary judge were to have drawn an inference that Mr Ellis had made similar statements in the 17 meetings he had attended with distributors and Wright Steel prior to meeting with Yieh Phui, it would not establish that such conduct was inconsistent with an attempt to induce the impugned understandings or with the recommended resale price operating as a minimum price. As the ACCC submits:

... there is no form of words that can or should shield conduct from the reach of the cartel provisions if, in substance, the conduct amounts to reaching or attempting to reach a prohibited understanding. Otherwise, it would effectively allow gaming of the statutory provisions.

1. It was certainly open to the primary judge to treat with significant scepticism the explanation given by Mr Ellis of the RRP strategy to Yieh Phui given the statements made by Mr Ellis in the course of explaining the strategy that he had obtained legal advice about the subject of the discussion, his lawyer had given him "very strict instructions" and that he was being very careful with the words that he was using, that were met with nervous laughter by Yieh Phui. In that context, the portion of the findings at LJ [1404(h)] reproduced at [482] above were both readily open to the primary judge and reflected the limited weight that his Honour placed on the explanation that Mr Ellis gave to Yieh Phui of the RRP strategy.
2. Any statement or statements made by Mr Ellis to the effect that the counterparty retained its "independent discretion as to pricing" must be viewed in that context. One could of course ask rhetorically why Mr Ellis would have thought it necessary to state the self-evident proposition, absent any arrangement or understanding to the contrary, that a competitor remained free to price its own products.
3. Given those findings, it is not apparent how any finding that Mr Ellis provided similar explanations of the RRP strategy at earlier meetings with distributors and Wright Steel would necessarily have been inconsistent with an attempt to induce the impugned understandings or with the recommended resale price operating as a minimum price.
4. It follows that ground 6 in Mr Ellis' appeal must fail.

BlueScope ground 6: was the ACCC precluded by s 77(2) of the Act from seeking a pecuniary penalty in respect of the OneSteel contravention?

1. BlueScope contends, in ground 6, that the primary judge erred in concluding in the penalty judgment (PJ [56]-[60]) that s 77(2) of the Act did not prevent the ACCC from seeking a pecuniary penalty against it in respect of the finding in the liability judgment (LJ [1520], [1522], [1524], [1526] and [1552(g)]) that BlueScope attempted to induce OneSteel to arrive at an understanding containing a cartel provision.
2. Section 77 of the Act provides as follows:

77 Civil action for recovery of pecuniary penalties

(1) The Commission may institute a proceeding in the Court for the recovery on behalf of the Commonwealth of a pecuniary penalty referred to in section 76.

(2) A proceeding under subsection (1) may be commenced within 6 years after the contravention.

1. As noted earlier, s 76(1) of the Act relevantly provides that "[i]f the Court is satisfied that a person: (a) has contravened ... (i) a provision of Part IV [which relevantly included s 44ZZRJ] ... or ... (d) has ... attempted to induce, a person, whether by threats or promises or otherwise, to contravene such a provision ... the Court may order the person to pay to the Commonwealth such pecuniary penalty, in respect of each act or omission by the person to which this section applies, as the Court determines to be appropriate...".
2. It was effectively common ground before the primary judge that s 77(2) operates as a limitation provision that applies from the date on which the relevant cause of action created by s 76 is complete: see PJ [55]; PT Garuda at [547] (Dowsett and Edelman JJ).
3. As will be discussed in more detail shortly, the primary judge granted the ACCC leave to amend its originating application to include a claim for a pecuniary penalty in respect of the allegation that BlueScope attempted to induce OneSteel to arrive at an understanding containing a cartel provision which was included in its statement of claim. That amendment was to take effect from 19 December 2019, being the date that the ACCC filed its statement of claim including that allegation.
4. In the liability judgment, the primary judge found that the "conduct of Bluescope and Mr Ellis with respect to OneSteel relied upon by the ACCC, taken as a whole, constituted steps towards the inducement of an understanding being reached between BlueScope and OneSteel containing a cartel provision, which steps were more than merely preparatory of the inducement and which were immediately and not merely remotely connected with the inducement": LJ [1520] (emphasis added). The conduct of BlueScope relied on by the ACCC comprised conduct that occurred during the period from 10 September 2013 to 2 June 2014: see LJ [1522]. As can be seen, that conduct straddled the date 19 December 2013, that being the date six years before the date that the ACCC was taken to have relevantly commenced the proceeding against BlueScope insofar as it related to the alleged attempt to induce OneSteel to contravene s 44ZZRJ.
5. At the penalty stage of the proceeding, BlueScope argued that the conduct that it engaged in before 19 December 2013 was "more significant" than the conduct that it engaged in after that date: PJ [59]. The primary judge concluded, however, that the relevant "act or omission" by BlueScope to which s 76(1) applied was the "attempt to induce OneSteel to arrive at an understanding containing a cartel provision" which was "committed or was complete on 2 June 2014": PJ [60]. It followed that s 77(2) of the Act "did not prevent the ACCC from seeking a penalty in respect of that conduct": PJ [60].
6. BlueScope now argues that the primary judge's finding in that regard was wrong. Indeed, BlueScope goes so far as to argue that the ACCC's cause of action against it in relation to the attempt to induce OneSteel was statute barred because the cause of action was complete prior to 19 December 2013.
7. The ACCC argues that there is no merit in BlueScope's contention that the primary judge erred in finding that s 77(2) of the Act did not prevent the ACCC seeking a penalty in respect of BlueScope's conduct that constituted an attempt to induce OneSteel to arrive at an understanding containing a cartel provision. It also argued that the arguments now advanced by BlueScope in respect of this issue were not advanced before the primary judge, that BlueScope therefore requires leave to advance those arguments and that leave to advance those arguments should be refused.
8. It is necessary to first consider the ACCC's submission that BlueScope should be refused leave to advance the arguments it now advances, or seeks to advance, in respect of ground 6. To address those submissions, it is necessary to go into a little more detail in respect of the procedural history.
9. The ACCC commenced this proceeding on 29 August 2019 by filing an originating application and concise statement, neither of which included any allegation involving BlueScope attempting to induce OneSteel to arrive at an understanding containing a cartel provision. The ACCC filed a statement of claim on 19 December 2019 which included that allegation, however the ACCC did not immediately seek leave to amend its originating application to seek any relief in respect of that allegation. It eventually did so, however, and on 12 May 2020, the primary judge, over BlueScope's opposition, granted the ACCC leave to file an amended originating application which sought that relief on the basis that the amendments took effect on 19 December 2019: see Australian Competition and Consumer Commission v BlueScope Steel Limited (No 2) [2020] FCA 625 (amendment judgment or AJ).
10. In opposing the ACCC's application for leave to amend its originating application, BlueScope contended that the claim alleging that it attempted to induce OneSteel was statute barred. BlueScope argued that "most" of the conduct in which it allegedly engaged occurred in September 2013 and that the conduct that occurred after that date did not relevantly constitute an attempt at inducement: AJ [27]. The ACCC, however, argued that its allegation concerning the attempt to induce OneSteel concerned a course of conduct by BlueScope that continued until June 2014: AJ [26]. The primary judge held that it was open to the ACCC to argue that BlueScope engaged in that course of conduct, though he observed that whether the ACCC was able to establish that allegation would depend on the evidence that was adduced at trial: AJ [28]. Moreover, his Honour noted that, assuming that the ACCC was able to establish the allegation, "whether the conduct so proved satisfies the limitation period in s 77(2) is also a question that should be determined at trial": AJ [28]. The primary judge accordingly concluded that "the proposed amendment may not be time-barred and the question of the application of the applicable limitation period should be determined at trial": AJ [28].
11. Following the handing-down of the amendment judgment, the ACCC filed a further amended statement of claim and BlueScope filed a defence to the further amended statement of claim. In response to the ACCC's plea (in [153] of the further amended statement of claim) for the maximum pecuniary penalty for each of the pleaded attempt to induce contraventions, BlueScope pleaded (at [153] of its defence) that: the ACCC's claim for relief in respect of the conduct relating to the alleged attempt to induce OneSteel had not been included in the ACCC's originating application; the facts out of which that claim for relief was alleged to arise, were not pleaded in the ACCC's concise statement; and that relief was statute barred under s 77(2) of the Act. The defence provided no further particulars of that plea.
12. BlueScope did not press its contention that the ACCC's claim for relief in respect of the alleged attempt to induce OneSteel was statute barred, either at the liability stage or the penalty stage of the proceeding. The issue appears not to have arisen at all at the liability stage of the proceeding and is therefore not addressed in the liability judgment. The issue arose at the penalty stage, however BlueScope did not contend, or contend in clear and unequivocal terms, that the ACCC's claim in respect of OneSteel was statute barred. Rather, it simply contended that its acts or omissions before 19 December 2013 concerning OneSteel could not be the subject of a penalty, or taken into account in determining the penalty, as that would "create a risk that BlueScope would be penalised for conduct which Parliament has said should not be subject to a penalty": PJ [54].
13. It is apparent from the penalty judgment that BlueScope did not press its plea that the ACCC's claim in respect of the attempt to induce OneSteel was statute barred, or at least did not advance the argument that it now seeks to advance in support of the contention that the claim is statute barred. In the penalty judgment, after reiterating that the conduct by BlueScope that the ACCC alleged constituted an attempt to induce OneSteel "spanned the time period from 10 September 2013 until 2 June 2014", the primary judge noted (at PJ [59]):

... In the Liability Judgment, I found that that conduct, taken as a whole, constituted the attempt. Neither the ACCC nor BlueScope advanced a case at trial that, if an attempt occurred, the conduct constituting the attempt was complete prior to 19 December 2013. In the penalty hearing, BlueScope submitted that the conduct that occurred before 19 December 2013 was more significant than the conduct that occurred after that date. It did not submit, however, that the attempt was complete prior to 19 December 2013.

(Emphasis added.)

1. As adverted to earlier, BlueScope now wishes to argue that the ACCC's claim for relief in respect of the attempt to induce OneSteel was statute barred because the attempt was complete prior to 19 December 2013. The ACCC submits that BlueScope should not be permitted to advance that argument because it did not advance that argument before the primary judge.
2. The principles that apply where leave is sought to raise an argument on appeal that was not advanced at first instance are well-established. In VUAX v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 158; 238 FCR 588, the Full Court held (at [46]) that leave should only be granted "if it is expedient in the interests of justice to do so" and observed (at [48]):

... The Court may grant leave if some point that was not taken below, but which clearly has merit, is advanced, and there is no real prejudice to the respondent in permitting it to be agitated. Where, however, there is no adequate explanation for the failure to take the point, and it seems to be of doubtful merit, leave should generally be refused. ...

1. In CVRZ v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2021] FCAFC 205, the Full Court observed (at [19]), that requiring an appellant to show that it is expedient and in the interests of justice for an appellate court to grant leave "endeavours to strike an appropriate balance between securing the role of the court at first instance, protecting the integrity of the appellate process, and meeting the needs of justice as understood within the judicial process". Perhaps more significantly, in Khalil v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2022] FCAFC 26 (Katzmann, Banks-Smith and Rofe JJ), the Full Court stated (at [34]):

The Court's power to grant leave must be exercised in the way that best promotes the overarching purpose of the civil practice and procedure provisions of the Federal Court of Australia Act 1976 (Cth) (FCA Act) and Rules: FCA Act, s 37M. That purpose is the facilitation of "the just resolution of disputes... according to law" and "as quickly, inexpensively and efficiently as possible". It includes objectives such as the just determination of all proceedings before the Court; the efficient use of the Court's judicial resources; the efficient disposal of the Court's overall caseload; and the timeous disposal of all proceedings. Dealing with a point for the first time on appeal does not serve those objectives.

1. BlueScope did not provide an adequate explanation for why they did not argue before the primary judge that the ACCC's claim for relief was statute barred because the alleged attempt to induce OneSteel was complete before 19 December 2013. Rather, it pointed to the fact that the primary judge accepted (at PJ [60]) the ACCC's argument that the alleged attempt was complete on 2 June 2014. It also argued that the ACCC's objection was not to the raising of a new "ground" but was in substance an objection only to the raising of one of its four arguments as to why the primary judge erred. There is, however, no merit in that submission. BlueScope's argument that the alleged OneSteel attempt was complete by 19 December 2013 is central to its ground that the ACCC's claim for relief in respect of the attempt is statute barred. It is an argument that was not advanced before the primary judge. No adequate explanation has been proffered as to why that argument was not advanced. Further, BlueScope ultimately conceded that the argument that it advanced before the primary judge was different to the argument it now seeks to raise on appeal.
2. More significantly, the ACCC contended that it would suffer prejudice if BlueScope was now permitted to raise the new argument. It submitted, in that regard, that if BlueScope had pressed its contention that the OneSteel claim was statute barred because the alleged attempt was complete by 19 December 2013, it could have applied for leave to amend its pleading to allege, in the alternative, that the conduct BlueScope engaged in after 19 December 2013 was capable of constituting an attempt to induce OneSteel. The conduct that was engaged in before 19 December 2013 would, on that possible alternative plea, be relevant in establishing BlueScope's intention in engaging in the post-19 December 2013 conduct, but would not itself be considered to be conduct constituting the contravention. BlueScope's rejoinder is that there would have been no basis for permitting the ACCC to amend as the ACCC was aware, from BlueScope's defence, that there was an issue as to whether the ACCC's claim in relation to OneSteel was statute barred, but the ACCC persisted with its case that the attempt to induce OneSteel was constituted by a course of conduct.
3. There is merit in the ACCC's contention that it would suffer prejudice if BlueScope is permitted to argue that the ACCC's cause of action concerning the OneSteel attempt is statute barred on the basis that the cause of action was complete by 19 December 2013. Had BlueScope advanced that argument before the primary judge, the ACCC may have sought to amend its pleading to raise the alternative case based on the alleged attempt being constituted by conduct that occurred after 19 December 2013. It cannot be said that the primary judge would necessarily have refused any such amendment application. Nor, for reasons explained later, could it be said that the alternative case would necessarily have failed. It may be accepted that the conduct that occurred after 19 December 2013 was far less significant than the conduct that occurred before that date, however it does not necessarily follow that the post-19 December 2013 conduct was not capable of constituting an attempt to induce. There is also merit in the argument that the pre-19 December 2013 conduct would remain relevant to establishing BlueScope's intention in engaging in the post-19 December 2013 conduct.
4. There is, in those circumstances, considerable force in the ACCC's submission that BlueScope should not be permitted to argue on appeal that the ACCC's cause of action in respect of the OneSteel attempt was statute barred because it was complete by 19 December 2013. That is particularly so given the absence of any adequate explanation for why that argument was not advanced before the primary judge. Ultimately, however, it is the nature and merits of the argument in question which is the most significant factor in considering whether it is expedient and in the interests of justice to permit BlueScope to advance it on appeal. The argument raises an important question that appears not to have been the subject of any direct or relevant authority. That question concerns how the limitation period in s 77(2) of the Act applies in the case of contraventions constituted by conduct which straddles the applicable limitation date or period.
5. As for the merits, while BlueScope's arguments in support of ground 6 are not entirely devoid of merit, for the reasons that follow, the primary judge was correct to find that the relief sought by the ACCC in respect of BlueScope's attempt to induce OneSteel was not statute barred and the ACCC was not otherwise prevented from seeking a pecuniary penalty in respect of that conduct. It is, however, necessary to clarify or supplement some of his Honour's reasoning. The preferable course, in all the circumstances, is to grant BlueScope leave to raise the argument and deal with it on the merits.
6. The critical question that must be determined is when the limitation period, for the purposes of s 77(2) of the Act, commenced in respect of the ACCC's claim for the imposition of a pecuniary penalty, pursuant to s 76(1) of the Act, in respect of conduct in attempting to induce OneSteel, to contravene s 44ZZRJ of the Act. It was essentially common ground before the primary judge that the question was to be resolved by determining when the ACCC's cause of action accrued, the relevant cause of action being the cause of action under s 76(1) of the Act constituted by the conduct (act or omission) of BlueScope that amounted to an attempt to induce OneSteel to contravene s 44ZZRJ of the Act: see PJ [56].
7. The primary judge referred (at PJ [56]) to Bradford Old Bank Ltd v Sutcliffe [1918] 2 KB 833, in which Scrutton LJ stated (at 848) in essence that a cause of action may be taken to have accrued "after the occurrence of all the facts which the plaintiff must prove as part of his case - that is, at the time when the plaintiff could first have brought his action and proved sufficient facts to sustain it". Effectively applying that test, his Honour stated that determining the date of the accrual of the relevant cause of action involving the OneSteel attempt required the "identification of all the facts that the ACCC must prove in order to establish the contravention", where "contravention" in that context means "each act or omission to which s 76(1) applies and for which a penalty may be imposed": PJ [58].
8. It was in that context that the primary judge noted both that the conduct that the ACCC alleged constituted the attempt to induce OneSteel "spanned the time period from 10 September 2013 until 2 June 2014", and that in the liability judgment he had "found that that conduct, taken as a whole, constituted the attempt": PJ [59]; see also PJ [53] referring to the findings in LJ [1520] and [1522]. Having noted (at PJ [59]) that BlueScope had not advanced a case at trial that the attempt was complete prior to 19 December 2013, the primary judge concluded that the "attempt to induce OneSteel to arrive at an understanding containing a cartel provision, was committed or was complete on 2 June 2014": PJ [60]. That in effect amounted to a finding that the time period, for the purposes of the limitation period in s 77(2) of the Act, did not commence to run until 2 June 2014 when BlueScope's acts or omissions that the primary judge had found amounted to the attempt to induce OneSteel concluded.
9. BlueScope advanced four reasons why the primary judge's conclusion to that effect was wrong. None of them can be accepted.
10. BlueScope's first argument is that the primary judge was required to determine the date "when the ACCC was first able to issue a statement of claim necessary to support its entitlement to judgment" (citing Central Electricity Board v Halifax Corporation [1963] AC 785 at 806 per Lord Guest), but that his Honour instead "treated the end date of the pleaded conduct as determinative of when the cause of action accrued". That argument, however, does not take into account the fact that the cause of action in question in this case, unlike the cause of action considered in Halifax, was a continuing or ongoing contravention - an attempt to induce OneSteel constituted by conduct that continued throughout the period 10 September 2013 to 2 June 2014. That was the case that the primary judge found that the ACCC had made out at trial. The allegation of an attempt to induce, constituted by conduct that occurred over a period of time, or as a course of conduct, is akin to the criminal law concept of a continuing or ongoing offence: see R v Moussad [1999] NSWCCA 337; 152 FLR 373 at [17]- [67].
11. The date upon which a limitation period may be taken to have commenced in the case of a continuing contravention of the sort alleged by the ACCC is properly regarded as being the date that the conduct constituting the contravention ceased - in this case, the date that the ongoing attempt to induce OneSteel ceased. It is artificial and erroneous to approach the issue on the basis that the ACCC could have first commenced proceedings against BlueScope alleging an attempt to induce OneSteel after the first act that could be said to constitute an attempt, even though the attempt continued after that date.
12. BlueScope argued that the date on which the limitation period commences in the case of a continuing contravention should not be taken to be the end date of the pleaded conduct because "an applicant could unilaterally extend limitation periods simply by alleging further material facts which arose after the date the cause of action arose". That argument has no merit in the present context. In the case of a continuing or ongoing contravention, such as an ongoing attempt, the material facts would include conduct that constituted the ongoing attempt. It would be correct to take the limitation period as only commencing after that conduct ceased and it would be entirely proper for an applicant to allege those facts. An applicant who alleges material facts of that nature is not properly to be taken to be unilaterally extending the limitation period. If the suggestion is that an applicant could artificially extend a limitation period by pleading facts that do not genuinely form part of the continuing contravention, the answer is that the respondent in those circumstances could apply to strike out those facts, or argue that those facts should not be taken into account in determining the date from which the limitation period commenced. That did not occur in this case. Nor could it have.
13. BlueScope's second argument was that the ACCC did not in fact advance a case at trial to the effect that the cause of action was not completed until 2 June 2014. There is no merit in that contention. As the primary judge found, the ACCC's case was that the conduct constituting the alleged attempt to induce continued up until 2 June 2014 and that it was BlueScope's conduct during the period 10 September 2013 to 2 June 2014 "taken as a whole" that constituted an attempt. The finding that the ACCC's case was that the impugned conduct continued up to 2 June 2014 is borne out by the ACCC's pleading, which includes (at [119] of the further amended statement of claim) conduct that occurred on "20 December 2013, 4 February 2014, 6 March 2014, 2 April 2014, 30 April 2014 and 2 June 2014" and alleges that the conduct alleged in several paragraphs of the pleading, including [119], "severally or in any combination" constituted the alleged attempt to induce.
14. BlueScope argues that the facts alleged in [119] of the ACCC's pleading (which include facts occurring up to 2 June 2014) are "not alleged to give rise to any inducement" and are not elements of the "cause of action for attempt". There is no merit in that argument. It is based on an incomplete and unfair analysis of one paragraph of the pleading considered in isolation. Considered in context, it is clear that the conduct alleged in [119] of the pleading, which involved BlueScope sending monthly pricing information to OneSteel, was conduct which formed part of BlueScope's continuing and ongoing attempt to induce OneSteel to arrive at a cartel arrangement. The sending of price lists was integral to, or at least formed part of, BlueScope's efforts to induce OneSteel to arrive at the impugned understanding.
15. BlueScope's third argument is that the primary judge's conclusion that the ACCC's cause of action in respect of the OneSteel attempt was complete on 2 June 2014, was erroneous because it amounted to an implicit conclusion that none of the events that occurred before 2 June 2014 were sufficient to give rise to a cause of action. That argument is based on an erroneous reading or characterisation of the primary judge's reasons. The primary judge did not implicitly conclude that none of the events that occurred before 2 June 2014 were sufficient to constitute an attempt by BlueScope to induce OneSteel to arrive at the impugned arrangement. Rather, his Honour concluded that the events that occurred before 2 June 2014 were an integral or important part of the continuing or ongoing attempt by BlueScope to induce OneSteel to arrive at the understanding.
16. The primary judge's conclusion that the alleged "attempt to induce OneSteel to arrive at an understanding containing a cartel provision, was committed or was complete on 2 June 2014" should not be construed, as BlueScope effectively contends, as amounting to a finding that the last element of the ACCC's cause of action occurred on 2 June 2014. Read in context, it amounted to no more than a finding that the continuing or ongoing attempt by BlueScope to induce OneSteel continued up to 2 June 2014.
17. BlueScope's fourth argument is also based on a misreading or mischaracterisation of the primary judge's reasons. BlueScope's argument fixes on one paragraph (LJ [1524]) of the primary judge's reasons in the liability judgment in which his Honour explains, in brief terms, why BlueScope's conduct, as set out at length in earlier paragraphs, constituted or comprised an inducement. In short, BlueScope, through Mr Ellis, had told OneSteel that it was promoting an opportunity to distributors, including OneSteel, which involved distributors setting their prices by reference to the CIPA price lists. His Honour concluded that the communication of that "opportunity" to OneSteel constituted or comprised an inducement to OneSteel to arrive at a price fixing understanding and that BlueScope's proposals to OneSteel in that regard were capable of assent. BlueScope argued that each of those matters occurred prior to 13 December 2013 and that the cause of action must therefore have arisen by 19 December 2013. That argument cannot be accepted.
18. The primary judge did not find (at LJ [1524] or anywhere else) that BlueScope's conduct that constituted its inducement all occurred before 19 December 2013. Indeed, it is clear from his Honour's reasoning at LJ [1524], read fairly and in context, including in the context of the findings summarised at LJ [1522(i) to (n)], that the provision to OneSteel of monthly pricing information, including in the months of February, March, April and June 2014, was part of the overall conduct which constituted the attempt to induce OneSteel to arrive at the impugned understanding. Indeed, as the primary judge explained, the price lists that were sent to OneSteel and other distributors on and after 20 December 2013 for the first time contained an express reference to the "recommended resale price": LJ [1522(i)]. That change was intended to give prominence to the recommended resale price: LJ [1170]. It is not to the point that BlueScope's conduct in sending the recommended prices lists to OneSteel in 2014 may not have been a "necessary element" of the primary judge's reasoning that BlueScope's conduct, taken as a whole, constituted an attempt to induce OneSteel.
19. The primary judge's reasoning and conclusion that the ACCC's claim that BlueScope was liable to pay a pecuniary penalty pursuant to s 76(1) of the Act in respect of its conduct in attempting to induce OneSteel to contravene s 44ZZRJ of the Act by arriving at an understanding containing a cartel provision was correct. BlueScope's arguments that the primary judge erred in so concluding are rejected. Appeal ground 6 has not been made out.

Ellis ground 8: does the Court have the power to make a non-indemnification order?

1. Having ordered Mr Ellis to pay pecuniary penalties totalling $575,000 pursuant to s 76(1) of the Act (PJ order 5), the primary judge made the following order (PJ order 6):

Ellis is not to pursue any claim or accept any indemnity under any directors and officers insurance policy to which BlueScope or Ellis is a party or an insured for payment or reimbursement of any part of the pecuniary penalty the subject of order 5.

1. The primary judge and the parties called that order the non-indemnification order.
2. Mr Ellis' appeal ground 8 is, in essence, that the primary judge erred in concluding that s 76 of the Act confers power on the Court to make the non-indemnification order.
3. The context for the making of the non-indemnification order was that there was evidence that BlueScope had taken out a Directors and Officers Liability Policy with an insurance company which the insurer was obliged to "pay to or on behalf of Insured persons any amount the Insured Person is legally obligated to pay as a fine or penalty, to the extent permitted by law": PJ [161]. It was uncontentious that Mr Ellis was an Insured Person for the purposes of the policy.
4. The ACCC sought the non-indemnification order against Mr Ellis given his "central, ongoing and relentless role in the attempts to induce the price fixing understandings, his conduct during the investigation and trial, and his absence of contrition": PJ [162]. The ACCC submitted before the primary judge that a non-indemnification order was "necessary to ensure that he [Mr Ellis] feels a 'real sting or burden' of any penalty ordered and that the penalty achieves the required deterrent effect": PJ [162]. As for the power to make the order, the ACCC relied on the decision of the majority in the High Court in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] HCA 3; 262 CLR 157 (ABCC) concerning the cognate pecuniary penalty provision in the Fair Work Act 2009 (Cth) (s 546) and argued, by analogy, that s 76(1) of the Act included the power to make a non-indemnification order.
5. Mr Ellis opposed the making of the non-indemnification order on the basis that the decision in ABCC was distinguishable because it was concerned with the question whether one respondent (a union official) could be ordered to pay a pecuniary penalty personally and not seek or receive an indemnity from the other respondent (the union in question). It was not concerned with whether a respondent could seek or receive an indemnity from an insurer who was not a party to the proceeding. Mr Ellis also argued that the constructional issue in respect of s 76(1) of the Act was different to the issue in respect of s 546 of the Fair Work Act because the Act included s 77A, which provided that a body corporate must not indemnify an officer in respect of a pecuniary penalty. Mr Ellis also relied on the fact that the Act does not contain a provision like s 199B of the Corporations Act 2001 (Cth), which prohibits a company from paying a premium for a contract insuring an officer of the company against liabilities arising from, among other things, contraventions of certain provisions of that Act.
6. The primary judge accepted the ACCC's submissions, rejected Mr Ellis' submissions (PJ [164]-[173]) and found that the Court had power under s 76(1) of the Act to make the non-indemnification order: PJ [174]. His Honour found that it was appropriate to make the non-indemnification order: PJ [175].
7. Mr Ellis contends that the primary judge erred in concluding that the Court was empowered to make the non-indemnification order. His submissions largely mirrored those that he advanced before the primary judge.
8. The primary judge did not err in concluding that the Court has powers to make personal payment or non-indemnification orders of the sort he made against Mr Ellis. The Court has the power to make such orders essentially for the reasons given by the majority in ABCC. While ABCC involved a different statutory provision and some different circumstances, the reasoning of the majority in that case applies equally to s 76(1) of the Act and the statutory scheme in the Act in relation to pecuniary penalties more generally. The points of distinction relied on by Mr Ellis have no real significance.
9. In ABCC, the primary judge in this Court had made pecuniary penalty orders against a union and one of its officials for contravening a civil remedy provision of the Fair Work Act and made an order that the union must not indemnify the official against the pecuniary penalty orders made against him. The primary judge held that the Court was empowered to make such an order by s 545 of the Fair Work Act, which relevantly provided that the Court may make any order it considered appropriate if the Court was satisfied that a person had contravened a civil remedy provision. The Full Court of this Court allowed an appeal from that order, holding that s 545 of the Fair Work Act did not empower the Court to make such an order. That finding was unanimously upheld in the High Court.
10. The majority in the High Court, however, held that the power in s 546 of the Fair Work Act to make a pecuniary penalty order carried with it an implied power to make an order that a person against whom a pecuniary penalty order is made pay that penalty and not seek or accept an indemnity from a co-contravenor. Section 546(1) of the Fair Work Act is in relevantly the same terms as s 76(1) of the Act. It relevantly provides that the Court "may, on application, order a person to pay a pecuniary penalty that the court considers is appropriate if the court is satisfied that the person has contravened a civil remedy provision". While the finding by the majority was directed to whether the Court was empowered to make an order that a contravenor not seek or accept an indemnity from a co-contravenor, that was simply a product of the fact that the order in question involved co-contravenors. Careful attention to the reasoning of the majority judges reveals that the finding was not limited to the power to make a non-indemnification order as between co-contravenors, but extended to orders requiring a contravenor pay a pecuniary personally, or not seek or accept an indemnity from a third party.
11. Chief Justice Kiefel observed (at [40]) that "[e]very court possesses jurisdiction arising by implication, upon the principle that a grant of power carries with it everything necessary for its exercise" and that the term "necessary" in that context means "reasonably required or legally necessary to the accomplishment of what is specifically provided to be done by the statute". Her Honour reasoned (at [41]) that it was difficult to see how an order requiring a pecuniary penalty to be paid by the union official and not the union "in order that the effect of the penalty to a much greater extent be felt by him ... could not be seen as necessary to the exercise of the power given by s 546(1), particularly when regard is had to its principal, if not its only, purpose".
12. The Chief Justice's reference, in that context, to the purpose of the power to impose a pecuniary penalty was a reference to the principle that the principal, if not only, purpose of imposing a pecuniary penalty is to deter the contravenor and others from engaging in the same or similar contravening conduct: Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate [2015] HCA 46; 258 CLR 482 at [55]. Her Honour concluded (at [44]) that a "personal payment order" (an order preventing the contravenor from seeking indemnification with respect to the payment of the penalty - see [7]) "adds only to the effect which is felt by a contravenor" and thereby "seeks to accomplish the purpose for which the power is given by s 546(1) within the limits of what is necessary to its effective exercise". It followed, her Honour held (at [49]), that the "power to make a pecuniary penalty order given by s 546(1) carries with it a power to make the person the subject of such an order pay the penalty personally".
13. It may be observed that none of that reasoning hinged on, or was in any way influenced by, the fact that the personal payment order in question in ABCC prevented one contravenor from seeking or accepting an indemnity from a co-contravenor. The reasoning focussed on the fact that the purpose of imposing a penalty is to deter, and that an order requiring a person to personally pay a penalty (and not seek or accept an indemnity from anyone else) may be necessary to ensure that the power to impose a pecuniary penalty is effectively exercised. The same can be said in respect of the reasoning in the joint judgment of the other majority judges, Keane, Nettle and Gordon JJ.
14. Like Kiefel CJ, Keane, Nettle and Gordon JJ noted (at [115]) that from the express conferral of power in s 546 of the Fair Work Act to order a person to pay a pecuniary penalty "arises an implied power to make such other orders as are necessary for or facilitative of the type of orders expressly provided for". Their Honours reasoned (at [118]) that it followed that the express grant of power in s 546 of the Fair Work Act to impose a pecuniary penalty carried with it an "implied power to make such further orders as are reasonably required for, or legally ancillary to, the accomplishment of the deterrent effect that the penalty is calculated to achieve" and (at [119]) "to achieve the effect which a pecuniary penalty is calculated to achieve by ordering that a contravenor pay the penalty personally".
15. The reasons of Keane, Nettle and Gordon JJ also included the following (at [120]):

Given that s 546 expressly empowers the court to order a specific person to pay a pecuniary penalty, it is no stretch to accept that there is power in s 546 to make orders designed to ensure that the person against whom the order is made cannot avoid the incidence of the penalty. It is to take too narrow a view of the purpose of s 546 to regard the provision as being concerned with no more than that an amount of money be paid by someone in discharge of a debt created by order of the court. Section 546 is not about the creation and collection of debts; it is about penalising a contravention of the law. It is to take too narrow a view of the extent of the power conferred by s 546 to deny that it extends to the making of orders designed to ensure that a particular person cannot defeat the purpose of an order that the person pay the penalty imposed on him or her.

1. As can be seen, that reasoning applies to any form of order, directed to the contravenor in question, that the contravenor personally pay the pecuniary penalty and not seek or accept an indemnity from anyone else. It is not limited to orders preventing a contravenor from seeking or accepting an indemnity from a co-contravenor.
2. It follows that, while the decision in ABCC was factually concerned with whether the Court could order that a contravenor (the union official) not seek or accept an indemnity or payment of the penalty imposed on him from his co-contravenor (the union), the principle enunciated by the majority was not so limited. Mr Ellis' submission to the contrary is rejected.
3. There is no other reason why the reasoning in ABCC could be said to be inapplicable to s 76(1) of the Act. As already noted, s 76(1) of the Act is in relevantly similar terms to s 546(1) of the Fair Work Act. Mr Ellis' contention to the contrary focussed on the fact that the statutory scheme in relation to the imposition of pecuniary penalties under the Act included s 77A(1) which provides as follows:

(1) A body corporate (the first body), or a body corporate related to the first body, must not indemnify a person (whether by agreement or by making a payment and whether directly or through an interposed entity) against any of the following liabilities incurred as an officer of the first body:

(a) a civil liability;

(b) legal costs incurred in defending or resisting proceedings in which the person is found to have such a liability.

Penalty: 25 penalty units.

1. As can be seen, s 77A(1) of the Act essentially prohibits a company (or related company) from indemnifying a person against a civil liability that the person incurred as an officer of the company. It would, in the present case, prohibit BlueScope from indemnifying Mr Ellis against the pecuniary penalty imposed on him. It would not, however, prohibit Mr Ellis from seeking or accepting an indemnity in respect of the pecuniary penalties under the insurance policy referred to earlier. Nor would it (or did it) prohibit BlueScope from taking out, or paying the premiums in respect of, the insurance policy which relevantly covered Mr Ellis.
2. The Fair Work Act does not include a provision like s 77A of the Act. That is, Mr Ellis submitted, another point of distinction between the constructional issue in this case and the issue considered in ABCC.
3. It may be accepted, as Mr Ellis submitted, that the process of construing s 76(1) of the Act includes considering the statutory text in the context of the statutory scheme of which it forms part and that an implied statutory power must cohere with that statutory scheme. Accordingly, in construing s 76(1) of the Act, s 77A of the Act cannot be set aside. Equally, it is necessary to have regard to other contextual considerations, including any relevant legislative history.
4. Section 77A was originally inserted in the Act which preceded it, the Trade Practices Act 1974 (Cth), by the Trade Practices Legislation Amendment Act (No 1) 2006 (Cth). The Explanatory Memorandum to the Trade Practices Legislation Amendment Bill (No 1) (2005) stated as follows in relation to the insertion of s 77A in the Trade Practices Act:

Part 3 - Indemnities

... Part 3 of this Schedule addresses recommendation 10.2.3 of the Dawson Review. To that end, corporations will be prohibited from indemnifying officers against pecuniary penalties imposed, and legal costs incurred, as a result of proceedings pursuant to section 76 for a contravention of Part IV of the TP Act. Such a prohibition is consistent with the prohibition in section 199A of the Corporations Act 2001.

1. As adverted to in that statement, s 199A of the Corporations Act is in relevantly the same terms as s 77A of the Act. Mr Ellis submitted that it was of significance that the Explanatory Memorandum did not refer to s 199B of the Corporations Act, which, as noted earlier, prohibits a company from paying a premium for a contract insuring an officer of the company against liabilities arising from, among other things, contraventions of certain provisions of the Corporations Act. Indeed, he went so far as to contend that there was a deliberate legislative choice to limit the application of s 77A to the scope of operation of s 199A and not s 199B of the Corporations Act. That contention rather overstates the matter and it is at best doubtful whether such an inference can be drawn.
2. As the statement in the Explanatory Memorandum notes, the insertion of s 77A followed a recommendation made in the 2003 Report of the Trade Practices Review Committee, commonly referred to as the "Dawson Review" as one of its lead authors was Sir Daryl Dawson, AC KBE CB. The relevant recommendation in the Dawson Review was as follows:

The New Zealand legislation also prohibits a corporation from indemnifying a director, servant or agent of the corporation against liability for payment of a pecuniary penalty imposed for price fixing. The Committee considers that there should be a similar provision in our Act, but that it should extend to indirect as well as direct indemnification and should apply generally to pecuniary penalties imposed for breaches of Part IV.

1. As can be seen, the recommendation was that a provision similar to a provision in New Zealand's equivalent to the Trade Practices Act (the Commerce Act 1986) should be included in the Trade Practices Act. The recommendation said nothing about the existence of an equivalent provision in the Corporations Act, let alone recommend that a provision like s 199B should or should not be inserted in the Act. The available and preferable inference, in the circumstances, was that no consideration was given to insertion of a provision like s 199B of the Corporations Act, either by the Dawson Review or the legislature when s 77A was inserted into the Trade Practices Act. That is hardly surprising given that s 199B of the Corporations Act is a bespoke provision which essentially prevents a company from indemnifying its officers in respect of breaches of duties owed by officers to the company itself.
2. In any event, the presence of s 77A in the Act, and the absence of a provision like s 199B of the Corporations Act, does not compel a conclusion that s 76(1) of the Act does not carry with it an implied power to make a personal payment or non-indemnification order of the sort that the primary judge made against Mr Ellis. The majority in ABCC considered the relevance of provisions like s 77A of the Act to the constructional task, albeit in the context of the construction of s 546 of the Fair Work Act. The appellant in ABCC had argued that the fact that Parliament had determined that it was necessary to provide an express prohibition of indemnification in the Act and the Corporations Act indicated that a similar express prohibition in the Fair Work Act would be necessary to achieve the same result. That argument was rejected. Chief Justice Kiefel stated (at [46]):

The prohibitions in the statutes mentioned [s 77A of the Act and s 199A of the Corporations Act] reflect a policy which the legislature has determined should be applied universally. It is not suggested that such a policy is to be found in s 546(1). These statutory provisions do not provide assistance in determining the question of construction with respect to s 546(1), as to whether a power may be implied in order to render a pecuniary penalty order effective.

1. Justices Keane, Nettle and Gordon similarly observed (at [128]) that s 77A of the Act and s 199A of the Corporations Act "are grounded in policy considerations applicable in all cases falling within the ambit of those sections regardless of the circumstances" and "apply whether or not it is considered that it is otherwise necessary or desirable that indemnity be prohibited". Their Honours reasoned that it followed that those provisions contributed "nothing to the task of determining the scope of the power implicit in s 546 to accomplish the specific remedy imposed by a pecuniary penalty order according to the circumstances of each case". While those observations were made in respect of construing s 546 of the Fair Work Act, the same reasoning applies in respect of the construction of s 76(1) of the Act. The fact that the Act does not contain a provision like s 199B of the Corporations Act is of no moment for essentially the same reasons. Like s 77A of the Act and s 199A of the Corporations Act, s 199B of the Corporations Act is undoubtedly grounded in policy considerations and contributes nothing to the task of determining the scope of the implied powers that are reasonably required or legally necessary to the accomplishment of the power in s 76(1) of the Act.
2. The reasoning of the majority judges in ABCC concerning the relevance of s 77A of the Act and like provisions applies to the constructional issue in respect of s 76(1) of the Act, even though the issue in ABCC was the proper construction of s 546 of the Fair Work Act.
3. It might also be added that s 77A and like provisions, such as ss 199A and 199B of the Corporations Act are different in another respect to the implied power in s 76(1) of the Act to make a personal payment or non-indemnification order. Unlike personal payment orders and non-indemnification orders, which are directed to the person upon whom the pecuniary penalty has been imposed, s 77A of the Act and ss 199A and 199B of the Corporations Act are directed at a third party, namely a company of which the person is an officer. That company need not be a co-contravenor. The prohibitions in those provisions may ultimately have the effect that it is more likely that the contravening officer will pay the pecuniary penalty himself or herself, though they may not necessarily secure that result and they do not, in terms, directly require the contravening officer to personally pay the penalty.
4. In any event, the reasoning in ABCC relevantly applies and Mr Ellis' arguments based on s 77A of the Act and ss 199A and 199B of the Corporations Act have no merit and should be rejected.
5. Two final points should be noted. First, many of Mr Ellis' arguments in support of the proposition that s 76(1) of the Act does not carry with it an implied power to make a personal payment or non-identification order echo the reasoning of the dissenting judge in ABCC, Gageler J (as the Chief Justice then was). Mr Ellis made the formal submission that Gageler J was correct in his reasoning in ABCC and, by implication, the majority judges were incorrect. It is unnecessary to address that formal submissions other than to note that no persuasive argument was advanced as to why this Court should not follow the reasoning of the majority in ABCC and that, for the reasons already given, that reasoning applies equally to the circumstances of this case.
6. Second, Mr Ellis submitted that there was evidence before the primary judge that he had limited financial means to pay a pecuniary penalty. It followed, so it was submitted, that that the non-indemnification order rendered the pecuniary penalty order less efficacious, presumably because it made it less likely that the penalty would in fact be paid.
7. It may be accepted that evidence in relation to Mr Ellis' financial circumstances was adduced at the penalty stage of the proceeding. The primary judge considered that evidence: PJ [142]-[155]. It would be fair to say that the primary judge was somewhat sceptical in respect of Mr Ellis' contention that he had limited access to financial resources to pay any pecuniary penalty. His Honour inferred that Mr Ellis "currently owns no assets by reason of his own financial planning choices, and that such wealth that he has gained over the years is held by other members of his family": PJ [155]. His Honour also accepted that whatever pecuniary penalty he imposed, it would "only be paid if others, no doubt at Mr Ellis' request, choose to make funds available for that purpose": PJ [155].
8. It does not necessarily follow, however, that the imposition of a pecuniary penalty on Mr Ellis was somehow rendered less efficacious by the making of the non-indemnification order. The pecuniary penalty order would undoubtedly be denuded of any sting or burden if Mr Ellis was able to claim or accept indemnification pursuant to an insurance policy. It is also difficult to see how the penalty would have any deterrent effect in those circumstances. If Mr Ellis was not able to claim or receive any such indemnification, the pecuniary penalty would still carry some sting or burden for Mr Ellis. It would also have a deterrent effect, not only on Mr Ellis himself, but on others in like circumstances to him.
9. In any event, the argument based on Mr Ellis' financial circumstances has no significance to the issue of construction to which this appeal ground is directed. It has no bearing on the question whether the primary judge had the power to make the non-indemnification order. The question of whether the primary judge's exercise of the discretion to make the order somehow miscarried is beyond the scope of the appeal ground.
10. Mr Ellis failed to establish or demonstrate that the primary judge erred in concluding that s 76(1) of the Act confers power on the Court to make an order that he be prevented from pursuing any claim or accepting any indemnity under any insurance policy to which he or BlueScope was a party or insured for payment or reimbursement of any part of the pecuniary penalty imposed on him. Mr Ellis' appeal ground 8 must accordingly be dismissed.

1. The appeals are to be dismissed and the appellants are to pay the costs of the ACCC, as agreed or taxed.

I certify that the preceding five hundred and sixty-eight (568) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justices Wigney, Bromwich and Halley.