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On the first day of a hearing on claims the union sought to induce cartel behavior, the ACT building union was accused of trying to “run businesses out of town” that did not meet its demands.

After the trade union royal commission in 2016, the claims against the Manufacturing, Forestry, Shipping, Mining and Energy Union (CFMMEU) and Canberra chief Jason O’Mara emerged.

Prosecutor Rowena Orr notified the ACT Magistrates Court that new wage agreements were negotiated by the union in 2012 and 2013, first with a group of steel fixers and then with scaffolding firms.

The five steel fixing companies involved told the union that they were afraid they could not afford the new deal, Ms Orr said.

She said her case would demonstrate that the union, and Mr. O’Mara, then allegedly proposed that they should make an agreement to set a minimum price with each other, so that they could afford the changes.

A similar scheme was reportedly offered to the nine scaffolding firms, the court heard.

Ms. Orr told the court that she will call nearly 40 witnesses, including Fihi Kivalu, a former union figure, who was arrested by the Royal Commission for extortion.

He eventually pled guilty to the charge.

Ms. Orr said witnesses must advise the court how to discuss the minimum price schemes

He eventually pled guilty to the charge.

Ms Orr said witnesses would tell the court how they negotiated the minimum price agreements.

She claimed that some witnesses would also provide evidence of alleged remarks made by the representatives of the union, including threats against anybody who does not adhere to the minimum price.

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“If the union saw anyone charging below the union rate they would run them out of town,” she said.

She said it would be alleged that the union said at some point that it would like the companies to submit their tender documents to demonstrate that they were adhering to the rates.

When charges were filed in 2018, Rod Sims, head of the consumer watchdog ACCC, said cartel behavior affects customers.

“It’s, in general terms, where competitors get together to agree prices, to raise prices, or to restrict supply and have the same effect as raising prices, and that has obvious harm to consumers.”

“The penalties … are either up to $10 million per breach, or three times the profit made, or 10 per cent of turnover.

“In terms of individuals, the maximum penalty can be up to 10 years in jail.”

The ACT Magistrates’ Court hearing will determine whether adequate proof remains for a trial.

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