The Commerce Commission has issued formal warnings to several bricklayers in Blenheim after investigating alleged cartel behaviour.
G J Marfell Ltd, Mike Vis Bricklaying Ltd, along with bricklayers Benjamin Robertson and Andrew Dwyer, are suspected of violating Section 30 of the Commerce Act, which bans cartel behaviour.
The Commission’s investigation revealed a series of “courtesy calls,” including text message exchanges in which the bricklayers discussed project quotes.
ComCom said these discussions, especially those involving the disclosure of specific prices, could result in cover pricing, which is a type of bid-rigging.
Chairperson Dr John Small said the warnings were appropriate because, although the conduct was serious, the potential harm and financial impact were limited.
He added that it would act as a “significant sanction” for relatively small businesses within a small community.
“While these are warnings, we want to highlight this case as it serves as an important reminder to all tradespeople that they must understand and comply with their obligations under the law.”
The investigation began after a tip-off was submitted through the Commission’s Anonymous Reporting Tool.
ComCom said the texts took place when a customer who normally worked with one bricklayer contacted another. They then discussed pricing, and in some instances, one of the bricklayers submitted an “anti-competitive higher quote” to allow the other to keep the customer.
The price-fixing was intended to guarantee that a specific bricklayer would secure the job, which amounts to market allocation.
Small said the bricklayers’ conduct probably misled their customers, who requested multiple competitive quotes “in good faith.”
“It is crucial that sole traders and businesses take steps to ensure their commercial dealings with competitors are lawful.”
The Commission believed they obstructed—or attempted to obstruct—the investigation by not providing information that was required by law.