ACCC accuses Delta Building Automation of attempted ‘cartel conduct’

A contract business owner allegedly tried to take part in “cartel conduct” by offering a competitor a payment during a meeting in a cafe.

A businessman allegedly tried to rig the bidding for a major contract with the National Gallery of Australia by offering a payment to his main competitor during a meeting at a Canberra cafe.

Court documents filed by the Australian Competition and Consumer Commission in the Federal Court in Canberra accuse Delta Building Automation and its sole director Timothy Dixon Davis of “attempted cartel conduct”, which the ACCC describes as one of the “most egregious violations of competition law.”

Delta Building Automation director Timothy Dixon Davis. Picture: Twitter

The ACCC claims Mr Davis rang Logical Electrical Solutions (LES) general manager Antony McEvilly on December 16, 2019, inviting him to a meeting to discuss a tender to upgrade the National Gallery’s building management system, which controls lights, air-conditioning and power. The tender had not been publicly announced.

According to court documents, the men allegedly met at a cafe two days later, with Mr Davis accused of telling Mr McEvilly that the tender would be announced in early 2020 and that “Delta would win … even if it ranked second … and impliedly represented that he was confident that Delta would win … even if it submitted a higher priced and/or lower quality bid than LES.”

The ACCC alleges “ (Mr) Davis expressly offered to make a payment to ‘appease” (Mr) McEvilly or LES so that (Mr) McEvilly would not be ‘wasting’ his time or LES’s time) in connection with the BMS Upgrade Tender”.

According to the court document, Mr McEvilly rejected the alleged offer. He is not accused of any wrongdoing.

ACCC chairman Rod Sims said: “The alleged cartel behaviour, involving an attempt to bid rig with a competitor in respect of bids for the tender of a government institution like the National Gallery of Australia, is of particular concern as it had the potential to impact the cost to taxpayers.

It is illegal to make or attempt to make cartel arrangements with competitors.

“Cartel arrangements usually drive up prices to the detriment of consumers or other businesses and organisations and are strictly prohibited,” Mr Sims said.

The ACCC is seeking declarations, monetary penalties and injunctions, plus an order disqualifying Mr Davis from managing a company, and orders for compliance training.

A court date has yet to be set.

Delta employs 38 people in Canberra and has operations in NSW and other states.

LES has 15 employees.

The approximate value of the tender is not known.