Loyal has admitted that in early June 2009 when it was majority owned by members of the Obeid family that entered into an understanding with Cascade Coal which provided that Loyal would withdraw from the tender process and refrain from pursuing competing bids in respect of Mount Penny and Glendon Brook.
In return Cascade would grant a 25% interest in its mining venture in respect of the Mount Penny coal release area to Buffalo, another Obeid family company.
Loyal subsequently gave effect to the understanding by withdrawing its bids and Cascade won the tender for the Mount Penny and Glendon Brook coal release areas and Buffalo was granted a 25% interest in the Mount Penny project.
Loyal has admitted that by engaging in this conduct it made an understanding containing an exclusionary provision, and gave effect to the exclusionary provision, in breach of the Competition and Consumer Act 2010 (Cth). The parties will ask the Federal Court to make orders to this effect, by consent.
Whitehaven Coal is now the parent company of Loyal, which it acquired in August 2012 through a hostile takeover of Coalworks Limited.
The ACCC acknowledges that Whitehaven was not in any way involved in, or aware of the conduct, and acquired its majority shareholding in Loyal well after the conduct occurred.
The ACCC commenced proceedings in the Federal Court of Australia against 11 respondents for alleged bid rigging conduct involving mining exploration licences in the Bylong Valley, NSW.
