Investigation opened into Beijer’s acquisition of Heatcraft NZ and acquisition of rights to apply for HFC import permits
Published24 Jul 2020
The Commerce Commission has opened an investigation into Beijer Ref AB’s 2018 acquisition of Heatcraft New Zealand Limited, and its 2019 acquisition (via its subsidiary Kirby NZ Limited) of a “grandparented” right to import hydrofluorocarbons (HFCs) into New Zealand.
Beijer sold the Heatcraft New Zealand business to Reece New Zealand Limited soon after acquiring it in 2018, but retained the corporate vehicle, which has been renamed Kirby NZ Limited.
The Commission will consider whether competition is likely to have been substantially lessened in any relevant market in breach of sections 47 and/or 27 of the Commerce Act. Beijer did not apply for clearance for the 2018 (or 2019) acquisition.
Beijer (through its subsidiaries Realcold and Patton) and Reece are major suppliers of refrigeration and air conditioning equipment in New Zealand.
The Commission invites parties who consider they hold relevant information to contact the Commission by email to email@example.com with the reference Beijer/Heatcraft/Kirby in the subject line no later than 4pm Friday 7 August 2020.
Section 47 of the Commerce Act prohibits acquisitions that have or are likely to have the effect of substantially lessening competition. The Commission administers a voluntary notification regime that allows firms to apply for clearance if they consider their planned acquisition could raise competition issues. If firms do not apply for clearance, the Commission can initiate an investigation into a proposed or completed acquisition under section 47. If a person breaches section 47 they may be subject to a penalty of up to $500,000 for an individual or $5 million for a firm.
Section 27 of the Commerce Act prohibits agreements that have the purpose, effect or are likely to have the effect of substantially lessening competition. If the Commission concludes that a breach of section 27 has occurred, the maximum penalty is $500,000 for an individual and in the case of a body corporate the greater of $10 million, or either three times the value of any commercial gain resulting from the contravention; or if the commercial gain cannot be easily established, 10% of the turnover of the body corporate and all of its interconnected bodies corporate.