Singapore High Court interprets vital term of Competition Act in case of price-fixing by warehouse operators
Source: Business Times
Article Date: 03 Jul 2026
Author: Tay Peck Gek
This is the first time that the High Court has determined an appeal under the Competition Act.
The Singapore High Court has defined a vital term of the Competition Act in the first appeal under this law, providing clarity on what conduct constitutes a restriction of competition.
In a 113-page landmark judgment published on Tuesday (Jun 30), Justice Philip Jeyaretnam interpreted the phrase “by object” under section 34 of the Competition Act to refer to conduct that has a “manifest anti-competitive economic rationale”.
Such conduct, as objectively assessed, has the aim, purpose or rationale to prevent, restrict or distort competition within the relevant market.
He came to this conclusion after extensively examining the competition laws in various jurisdictions and the intention of the Singapore Parliament in enacting the law.
The judge then allowed the appeal by the Competition and Consumer Commission of Singapore (CCS) against the decision of the Competition Appeal Board (CAB), as he held that the conduct of the companies in question did breach the law.
CCS’ findings and financial penalties imposed on the companies were thus restored by Justice Jeyaretnam.
Case involving warehouse operators
CCS found that an exchange of surcharge information between a group of four warehouse operators amounted to a restriction of competition as stipulated under “by object” in section 34 of the Competition Act.
The competition watchdog imposed total financial penalties of nearly S$2.8 million on CNL Logistic Solutions, Gilmon Transportation & Warehousing, Penanshin (PSA KD) and Mac-Nels (KD) Terminal.
CNL Logistic Solutions and Mac-Nels each had to pay about S$500,000, while Gilmon Transportation & Warehousing was slapped with the highest penalty of about S$1.4 million.
Penanshin got a nearly S$300,000 penalty after it voluntarily disclosed involvement in the price-fixing cartel.
The companies provide warehousing services at Keppel Distripark, a multi-tenanted cargo distribution complex.
Their competitor Hup Soon Cheong Services, which operates the largest warehouse at the complex, announced on Jun 15, 2017, that it would be imposing a surcharge.
Its sister company Capital Logistics Services followed suit the same day.
Soon, CNL, Gilmon, Penanshin, Mac-Nels and other companies in Keppel Distripark announced a similar surcharge.
CCS in its decision dated Nov 17, 2022, found that these four warehouse operators had engaged in “price-fixing conduct” when they contacted competitors directly to disclose their future pricing intentions, solicited confirmation that those competitors would follow suit and received the confirmation.
The concerted practice to coordinate the imposition of the surcharge with the objective of preventing, restricting or distorting competition has infringed section 34 of the Competition Act, the watchdog said.
Both CNL and Gilmon challenged the decision on both liability and the amount of financial penalties before CAB.
CAB held that the watchdog had not proven that the concerted practice amounted to a “by object” infringement of section 34 of the Competition Act nor had it paid sufficient regard to the economic context.
CCS’ characterisation of the communication between the four companies as “price-fixing conduct” was also rejected by CAB as it found the watchdog’s definition of price-fixing was too broad.
Any conduct that facilitates the coordination of future pricing conduct between competitors is deemed by CCS to be price-fixing. In contrast, CAB said that an agreement is required between competitors to fix prices, which is different from information sharing.
But Justice Jeyaretnam ruled that the exchange of price-related information can be classified as a “by object” restriction.
The communication between the four warehouse operators had a manifest anti-competitive economic rationale, he held, dismissing their argument that it was merely “casual talk”.
“The underlying and fundamental economic justification for the respondents’ conduct was anti-competitive,” the judge pointed out.
CCS had thus correctly identified that the market was price-sensitive, that imposing the surcharge carried risks of losing customers, and that the communications reduced this uncertainty for the four companies.
This has made it easier or more likely for them to impose the surcharge on their clients.
Justice Jeyaretnam said: “I therefore hold that the CCS had sufficient regard to the economic context when coming to its conclusions.”
Source: The Business Times © SPH Media Limited. Permission required for reproduction.
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