The Commerce Commission will file criminal proceedings against Carter Holt Harvey and six current and/or former managers following an investigation under the Fair Trading Act.

The Commission alleges that from 1999 to November 2003, Carter Holt Harvey made false and misleading representations that construction timber Carter Holt Harvey sold was of a particular specification, MGP10, when it was not. The Commission further alleges that during this period, a number of Carter Holt Harvey senior managers were parties to the alleged conduct.

The Commission is unable to name the current and/or former managers involved as they need to be allowed the opportunity to seek legal advice.

The Commission is preparing its charges for filing in the Manukau District Court shortly. As this matter will soon be before the Court, the Commission is unable to provide any further comment at this stage.

Background

Machine stress-Graded Pine (MGP) is produced in accordance with specific Australian/New Zealand standards, with minimum properties to meet each represented grade. MGP10 (which stands for machine graded pine of a 10 giga pascals grade) is a premium grade that is used for frames and roof trusses. Under AS/NZS standard 1748:1997, MGP10 graded timber must have (among other properties) a mean Modus of Elasticity (MoE) of 10,000 giga pascals (10GPa) with a minimum of 9.4GPa.

Carter Holt Harvey supplied a structural timber product known as CHH Laserframe MGP10. Three of Carter Holt Harvey's sawmills (at Nelson, Putaruru and Kopu/Thames) graded, packed and labelled the timber as MGP10. MGP10 timber is typically used in roof trusses, window lintels and floor joists.

The Commission has been advised that machine stress grading provides one of the most reliable and economical methods of sorting timber into different grades for structural purposes.