Small business fears bullying by price fixers Visy and Amcor
Wednesday, October 17, 2007/
Small business owners who may have been ripped off by price fixers Visy and Amcor may opt out of the class action because they fear further bullying by the two giants.
About 17,000 businesses that include small and large businesses are eligible to participate in the class action against Visy and Amcor, who colluded to overcharge cardboard customers for five years.
Maurice Blackburn principal Rebecca Gilsenan says she estimates the price fixing cartel cost customers between $300 million and $700 million.
The average business may have been overcharged by between 8% to 23% for their cardboard boxes, she says.
She says her phone has been running hot from businesses who want to participate in the class action and be compensated for the overcharging. But she says many are too sacred to speak out about their losses as they don’t want to be persecuted.
Visy and Amcor have tied up about 90% of the cardboard box market between them. Small businesses still need to buy their boxes from the giants as there are few alternative suppliers.
“They (small business) are very concerned about how they will be treated in the future,” says Gilsenan. She says they need to keep buying their cardboard boxes from Amcor and Visy. “They don’t want to be persecuted (for participating in the class action)” she says.
The class action is open to any business that, between 2000 and 2005, bought more than $100,000 of cardboard from Amcor, Visy and other third party suppliers.
Companies that fit the description will be included unless they opt out. The Federal Court will contact companies before the trial to see if they want to opt out, she says.
Gilsenan says only Cadbury Schweppes has opted out so far in order to pursue its own action against Amcor.
She says Amcor and Visy can work out who is in the class action and approach them, maybe to reach an individual settlement. She says it would not be proper if the giants bullied them. “I am not suggesting it’s occurring, but it’s a worry on the company’s part.”
Meanwhile it emerged yesterday that Allan Fels, the former competition watchdog chief, has been working with Visy staff to improve their knowledge of the Trade Practices Act.