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Two Canadian Freight Forwarders plead guilty in Price Fixing Investigation

On April 8th and April 9th 2014 the Competition Bureau of Canada announced separate plea arrangements with two Canadian freight forwarders in relation to an investigation into anti-competitive practices under the Competition Act.

On April 8th, the Bureau announced that ECU Line Canada Inc. (ECU) and two of its executives pleaded guilty to fixing surcharges in Non-Vessel Operating Carrier (NVOC) consolidated export services. ECU agreed to a fine of CAD$1 million (USD$914,6000), while the two named executives received conditional sentences of four and three months. Under Canadian law, breaches of competition rules may be treated as criminal offences for which the corporation and its officers may be held liable.

On April 9th, the Bureau announced Overseas Container Forwarding Inc. (OCF) had also pleaded guilty in relation to the same investigation, agreeing to a fine of CAD$675,000 (USD$617,000). While the admitted facts included conspiring with ECU and its named executives, no principals of OCF were named in the announcement.

The guilty pleas come more than five years after the commencement Bureau’s investigation, which began in 2009 as a result of evidence obtained under its Immunity Program. “Under the Immunity Program, the first party to disclose to the Competition Bureau an offence not yet detected or to provide evidence leading to the filing of charges may receive immunity from prosecution from the Director of Public Prosecutions of Canada (DPP) as long as the party co-operates with the Bureau.”

While there was no further announcement on April 10th, several other freight forwarders were named in the initial Information and subject to execution of search warrants; the status of those investigations remains unknown.

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