The ACCC has commenced Federal Court proceedings against Techtronic Industries Australia Pty Limited (Techtronic), after it alleged it has engaged in resale price maintenance in relation to the wholesale supply of Milwaukee brand power tools, hand tools and accessories. This engagement is in breach of the Competition and Consumer Act, according to a recent Mirage News report.
Also known as RPM, resale price maintenance comes about when a supplier prevents, or attempts to prevent resellers of their goods or services from advertising or selling the goods or services below a specific minimum price.
According to the ACCC, Techtronic engaged in RPM conduct by entering into 96 agreements with independent dealers and buying groups which restricted the sale of Milwaukee products below a specified minimum price. The conduct took place between 2015 and 2021, according to the report.
It is also alleged that Techtronic enforced these agreements by issuing reminders, warnings and breach notices to dealers that advertised or sold Milwaukee products below a specific minimum price. According to the report, it is also alleged that Techtronic withheld supply from two of the dealers to enforce the restrictions on price discounting below the specified minimum price.
ACCC Deputy Chair Mick Keogh said that requiring retailers to charge at or above a minimum price for products in the way that we allege Techtronic has done, stifles retailers’ ability to compete on price, which ultimately hurts consumers.
“This is particularly so in industries where retailers would otherwise strongly compete on price, such as by offering price match guarantees to consumers. We alleged that Techtronic’s actions meant Milwaukee power tool dealers could not sell the products at a discount below the specified minimum price, depriving consumers of the chance to benefit from lower prices driven by competition,” Mr Keogh said.
The ACCC is seeking penalties, declarations, injunctions, a compliance program order, as well as an order for corrective advertising and costs, according to the report.