Australian Competition and Consumer Commission v Volkswagen Aktiengesellschaft

• Jurisdiction: Australia Federal only
• Court: Federal Court (Australia)
• Judge: FOSTER J
• Judgment Date: 20 December 2019
• Neutral Citation: [2019] FCA 2166
• Date: 20 December 2019

FEDERAL COURT OF AUSTRALIA

Australian Competition and Consumer Commission v Volkswagen Aktiengesellschaft [2019] FCA 2166

File numbers:	NSD 1462 of 2016NSD 322 of 2017
Judge:	FOSTER J
Date of judgment:	20 December 2019
Catchwords:	CONSUMER LAW – Volkswagen and Audi dieselgate scandal – admitted contraventions of s 29(1)(a) of the Australian Consumer Law (ACL) by Volkswagen Aktiengesellschaft – two regulatory proceedings settled as between the regulator, Australian Competition and Consumer Commission, and Volkswagen, its subsidiaries and affiliates – whether the agreed pecuniary penalty is appropriate within the meaning of s 224(1) of the ACL and having regard to all relevant circumstances – consideration of relevant matters in determining the amount of the requisite pecuniary penalty – agreed penalty held to be manifestly inadequate and not appropriate – higher penalty imposed – whether declarations substantially in accordance with the parties’ settlement should be made – whether agreed costs order should be made
Legislation:	Australian Consumer Law, Pt 3.3 and ss 18(1), 29(1)(a), 29(1)(g), 33, 106, 224 and 246 Competition and Consumer Act 2010 (Cth), Sch 2 Evidence Act 1995 (Cth), s 191 Federal Court of Australia Act 1976 (Cth), s 20(1A) Motor Vehicle Standards Act 1989 (Cth), ss 5, 7, 10A, 14 and 18 Petroleum Retail Marketing Sites Act 1980 (Cth) Trade Practices Act 1974 (Cth), ss 45, 45A and 76 ; Australian Design Rule 79—Emission Control for Light Vehicles) United Nations Economic Commission for Europe Regulation 83, Uniform Provisions Concerning the Approval of Vehicles with Regard to the Emission of Pollutants According to Engine Fuel Requirements ; 18 U.S.C. §371 18 U.S.C. §542 18 U.S.C. §1343 18 U.S.C. §1512(c) 42 U.S.C. §7413(c)(2)(A)
Cases cited:	Attorney-General (SA) v Tichy (1982) 30 SASR 84 Australian Competition and Consumer Commission v Australia and New Zealand Banking Group Ltd (2016) 118 ACSR 124 Australian Competition and Consumer Commission v Cement Australia Pty Ltd [2017] FCAFC 159 Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd (2015) 327 ALR 540 Australian Competition and Consumer Commission v Cornerstone Investment Aust Pty Ltd (In Liq) (No 5) [2019] FCA 1544 Australian Competition and Consumer Commission v FFE Building Services Limited (2003) ATPR ¶41-969 Australian Competition and Consumer Commission v Hillside (Australia New Media) Pty Ltd (t/as Bet365) (No 2) [2016] FCA 698 Australian Competition and Consumer Commission v Qantas Airways Ltd (2008) 253 ALR 89 Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd (2016) 340 ALR 25 Australian Competition & Consumer Commission v Roche Vitamins Australia Pty Ltd [2001] FCA 150 Australian Competition and Consumer Commission v Woolworths Limited [2016] FCA 44 Australian Competition and Consumer Commission v Yazaki Corporation (2018) 357 ALR 55 Barbaro v The Queen (2014) 253 CLR 58 Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd (2003) 216 CLR 161 Clean Energy Regulator v MT Solar Pty Ltd [2013] FCA 205 Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate (2015) 258 CLR 482 Construction, Forestry, Mining and Energy Union v Cahill (2010) 269 ALR 1 Director, Fair Work Building Industry Inspectorate, v Construction, Forestry, Mining and Energy Union (2015) 229 FCR 331 Johnson v The Queen (2004) 205 ALR 346 Markarian v The Queen (2005) 228 CLR 357 Mill v The Queen (1988) 166 CLR 59 Minister for Sustainability, Environment, Water, Population and Communities v Woodley [2012] FCA 957 Minister for Industry, Tourism & Resources v Mobil Oil Australia Pty Ltd (2004) ATPR ¶41-993 Mornington Inn Pty Ltd v Jordan (2008) 168 FCR 383 NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission (1996) 71 FCR 285 Pearce v The Queen (1998) 194 CLR 610 R v MacNeil-Brown (2008) 20 VR 677 Singtel Optus Pty Ltd v Australian Competition and Consumer Commission (2012) 287 ALR 249 Trade Practices Commission v Allied Mills Industries Pty Ltd (No 5) (1981) 60 FLR 38 Trade Practices Commission v CSR Limited (1991) ATPR ¶41-076 Ultra Tune Australia Pty Ltd v Australian Competition and Consumer Commission [2019] FCAFC 164 Wong v The Queen (2001) 207 CLR 584
Date of hearing:	16 October 2019 and 13 November 2019
Registry:	New South Wales
Division:	General Division
National Practice Area:	Commercial and Corporations
Sub-area:	Regulator and Consumer Protection
Category:	Catchwords
Number of paragraphs:	278
Counsel for the Applicant:	Dr JK Kirk SC and Ms NL Sharpe SC
Solicitor for the Applicant:	Australian Government Solicitor
Counsel for the Respondents:	Mr GK Rich SC, Mr IJM Ahmed and Ms E Bathurst
Solicitor for the Respondents:	Clayton Utz

Table of Corrections
29 January 2020	In paragraph 272, replace the third last word (“conducted”) with the word “conduct”.
29 January 2020	In the second sentence of paragraph 273, replace the word “various” where it appears before the words “serious deception” with the word “very”.

ORDERS

		NSD 1462 of 2016
BETWEEN:	AUSTRALIAN COMPETITION AND CONSUMER COMMISSION Applicant
AND:	VOLKSWAGEN AKTIENGESELLSCHAFT First Respondent ; VOLKSWAGEN GROUP AUSTRALIA PTY LIMITED (ACN 093 117 876) Second Respondent

JUDGE:	FOSTER J
DATE OF ORDER:	20 december 2019

UPON the basis of the matters set out in the Statement of Agreed Facts dated 15 October 2019 (Ex C in the penalty hearing) (SOAF) and upon the basis of other material admitted into evidence at the penalty hearing and having considered the Joint Written Submissions of the parties dated 15 October 2019 and filed herein and the oral submissions made by the parties on 16 October 2019 and on 13 November 2019

THE COURT DECLARES THAT:

1. On 171 separate occasions in the period from 1 January 2011 to 3 October 2015 (Sales Period), in respect of 57,082 Volkswagen-branded motor vehicles more particularly described in Schedule 1 hereto (Relevant Vehicles), the first respondent (VWAG) submitted to the Delegate (delegate) of the Minister for Infrastructure and Regional Development the documents more particularly described in Schedule...