Commonwealth Director of Public Prosecutions v Bingo Industries Pty Ltd;; Commonwealth Director of Public Prosecutions v Tartak
[2024] FCA 121
•23 February 2024
FEDERAL COURT OF AUSTRALIA
Commonwealth Director of Public Prosecutions v Bingo Industries Pty Ltd;
Commonwealth Director of Public Prosecutions v Tartak
[2024] FCA 121
File number(s): NSD 647 of 2022
NSD 648 of 2022Judgment of: WIGNEY J Date of judgment: 23 February 2024 Catchwords: CRIMINAL LAW – sentencing – cartel conduct – making an arrangement containing a cartel provision – giving effect to a cartel provision – where corporate offender provided collections services and processing services for building and demolition waste in the Sydney metropolitan region – where the offender and its chief executive officer pleaded guilty – consideration of objective seriousness of the cartel offences – consideration of appropriate discounts for mitigating factors including plea of guilty and cooperation with law enforcement agencies – consideration of specific and general deterrence in sentencing cartel conduct – consideration of totality principle and parity with sentence imposed on co-offenders – consideration whether disqualification order should be made under s 86E of the Competition and Consumer Act 2010 (Cth) – appropriate sentence Legislation: Competition and Consumer Act 2010 (Cth) ss 45AB, 45AF, 45AG, 79(1), 86E, 154X, 155
Corporations Act 2001 (Cth) ss 206B(1), 206G
Crimes Act 1914 (Cth) Pt IB, ss 16A, 16AC, 16BA, 16C, 17A, 19AC, 20(1)(b), 20AB
Crimes (Sentencing Procedure) Act 1999 (NSW) Pt 2 Div 3, Pt 5, ss 7, 17C, 17D, 66, 67, 69, 73, 73A
Cases cited: Australian Competition and Consumer Commission v ABB Transmission and Distribution Limited (No 2) (2002) 190 ALR 169; [2002] FCA 559
Australian Competition and Consumer Commission v Apple Pty Limited [2012] FCA 646
Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd (2015) 327 ALR 540; [2015] FCA 330
Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd (No 3) (2005) 215 ALR 301; [2005] FCA 265
Australian Competition and Consumer Commission v Renegade Gas Pty Ltd (trading as Supagas NSW) [2014] FCA 1135
Australian Competition and Consumer Commission v Visy Industries Holdings Pty Limited (No 3) (2007) 244 ALR 673; [2007] FCA 1617
Australian Securities and Investments Commission v Wooldridge [2019] FCAFC 172
Azari v The Queen [2021] NSWCCA 199
Bui v Director of Public Prosecutions (Cth) (2012) 244 CLR 638; [2012] HCA 1
Cameron v The Queen (2002) 209 CLR 339; [2002] HCA 6
Camilleri’s Stock Feeds Pty Limited v Environment Protection Authority (1993) 32 NSWLR 683
Commissioner for Corporate Affairs (WA) v Ekamper (1987) 12 ACLR 519
Commonwealth Director of Public Prosecutions v Alkaloids of Australia Pty Ltd [2022] FCA 1424
Commonwealth Director of Public Prosecutions v Joyce [2022] FCA 1423
Commonwealth Director of Public Prosecutions v Kawasaki Kisen Kaisha Ltd (2019) 137 ACSR 575; [2019] FCA 1170
Commonwealth Director of Public Prosecutions v Nippon Yusen Kabushiki Kaisha (2017) 254 FCR 235; [2017] FCA 876
Commonwealth Director of Public Prosecutions v Vina Money Transfer Pty Ltd (2022) 294 FCR 449; [2022] FCA 665
Commonwealth Director of Public Prosecutions v Wallenius Wilhelmsen Ocean AS (2021) 386 ALR 98; [2021] FCA 52
Darter v Diden (2006) 94 SASR 505; [2006] SASC 152
Director of Public Prosecutions (Cth) v El Karhani (1990) 97 ALR 373; 21 NSWLR 370
Director of Public Prosecutions (Cth) v Page [2006] VSCA 224
Dunn v The Queen [2018] NSWCCA 108
Einfeld v The Queen (2010) 200 A Crim R 1; [2010] NSWCCA 87
Elias v The Queen (2013) 248 CLR 483; [2013] HCA 31
Environment Protection Authority v Barnes [2006] NSWCCA 246
Gaggioli v The Queen [2014] NSWCCA 246
Green v The Queen (2011) 244 CLR 462; [2011] HCA 49
Hanley v The Queen [2018] NSWCCA 262
Hili v The Queen (2010) 242 CLR 520; [2010] HCA 45
Jahandideh v The Queen [2014] NSWCCA 178
Jimmy v The Queen (2010) 77 NSWLR 540; [2010] NSWCCA 60
Johnson v The Queen (2004) 218 CLR 451; [2004] HCA 15
Kovacevic v Mills (2000) 76 SASR 404; [2000] SASC 106
Markarian v The Queen (2005) 228 CLR 357; [2005] HCA 25
Mill v The Queen (1988) 166 CLR 59; [1988] HCA 70
Mourtada v The Queen [2021] NSWCCA 211
Muldrock v The Queen (2011) 244 CLR 120; [2011] HCA 39
R v Curtis (No 3) (2016) 114 ACSR 184; [2016] NSWSC 866
R v Geddes (1936) 36 SR (NSW) 554
R v Hannes (2000) 36 ACSR 72; [2000] NSWCCA 503
R v Pullen (2018) 87 MVR 47; [2018] NSWCCA 264
R v Rivkin (2004) 59 NSWLR 284; [2004] NSWCCA 7
R v Zamagias [2002] NSWCCA 17
Stanley v Director of Public Prosecutions (NSW) (2023) 97 ALJR 107; [2023] HCA 3
Tapper v The Queen (1992) 39 FCR 243
Totaan v The Queen (2022) 108 NSWLR 17; [2022] NSWCCA 75
Tyler v The Queen (2007) 173 A Crim R 458; [2007] NSWCCA 247
Wany v Director of Public Prosecutions (NSW) (2020) 103 NSWLR 620; [2020] NSWCA 318
Wong v The Queen (2001) 207 CLR 584; [2001] HCA 64
Xiao v The Queen (2018) 329 FLR 1; [2018] NSWCCA 4
Division: General Division Registry: New South Wales National Practice Area: Federal Crime and Related Proceedings Number of paragraphs: 306 Date of last submissions: 2 August 2023 Date of hearing: 9 March 2023 Counsel for the Prosecutor: Mr P McGuire SC with Ms S Andrews Solicitor for the Prosecutor: Commonwealth Director of Public Prosecutions Counsel for the Accused in NSD 647 of 2022: Ms K C Morgan SC with Ms G Huxley Solicitor for the Accused in NSD 647 of 2022: Herbert Smith Freehills Counsel for the Accused in NSD 648 of 2022: Mr T Game SC with Ms R C A Higgins SC and Ms J Roy Solicitor for the Accused in NSD 648 of 2022: Herbert Smith Freehills ORDERS
NSD 647 of 2022 BETWEEN: COMMONWEALTH DIRECTOR OF PUBLIC PROSECUTIONS
Prosecutor
AND: BINGO INDUSTRIES PTY LIMITED
Accused
ORDER MADE BY:
WIGNEY J
DATE OF ORDER:
23 FEBRUARY 2024
THE COURT ORDERS THAT:
1.Convictions be entered against Bingo Industries Pty Limited in respect of the following offences:
a. the offence of making a cartel provision contrary to s 45AF(1) of the Competition and Consumer Act 2010 (Cth) as particularised in charge 1 in the indictment dated 1 March 2023 (count 1); and
b. the offence of giving effect to a cartel provision contrary to s 45AG(1) of the Competition and Consumer Act 2010 (Cth) as particularised in charge 2 in the indictment dated 1 March 2023 (count 2).
2.The following sentences be imposed on Bingo Industries Pty Limited:
a. in respect of count 1, a fine of $15,000,000; and
b. in respect of count 2, a fine of $15,000,000.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
ORDERS
NSD 648 of 2022 BETWEEN: COMMONWEALTH DIRECTOR OF PUBLIC PROSECUTIONS
Prosecutor
AND: DANIEL CHARBEL TARTAK
Accused
ORDER MADE BY:
WIGNEY J
DATE OF ORDER:
23 FEBRUARY 2024
THE COURT ORDERS THAT:
1.Convictions be entered against Daniel Charbel Tartak in respect of the following offences:
a. the offence of aiding, abetting, counselling or procuring Bingo Industries Limited to contravene a cartel offence provision, namely s 45AF(1) of the Competition and Consumer Act 2010 (Cth) as particularised in charge 1 in the indictment dated 16 August 2022 (count 1); and
b. the offence of aiding, abetting, counselling or procuring Bingo Industries Limited to contravene a cartel offence provision, namely s 45AG(1) of the Competition and Consumer Act 2010 (Cth) as particularised in charge 2 in the indictment dated 16 August 2022 (count 2).
2.The following sentences be imposed on Daniel Charbel Tartak:
a. in respect of count 1:
i.imprisonment for 18 months to commence on 23 February 2024 and end on 23 August 2025, with such imprisonment to be served by way of intensive correction in the community pursuant to s 7(1) of the Crimes (Sentencing Procedure) Act1999 (NSW); and
ii.a fine of $50,000;
b. in respect of count 2:
i.imprisonment for 18 months to commence on 23 August 2024 and end on 23 February 2026, with such imprisonment to be served by way of intensive correction in the community pursuant to s 7(1) of the Crimes (Sentencing Procedure) Act 1999 (NSW); and
ii.a fine of $50,000;
c. the following conditions are to apply to the intensive corrections orders referred to in orders 2(a)(i) and 2(b)(i):
i.the standard conditions prescribed by s 73 of the Crimes (Sentencing Procedure) Act 1999 (NSW), namely that Daniel Charbel Tartak must not commit an offence and must submit to supervision by a community corrections officer; and
ii.an additional condition pursuant to s 73A(2)(d) of the Crimes (Sentencing Procedure) Act 1999 (NSW), namely that Daniel Charbel Tartak perform community service work for 400 hours.
3.Pursuant to s 86E of the Competition and Consumer Act 2010 (Cth), Daniel Charbel Tartak be disqualified from managing corporations for a period of five years commencing on 23 February 2024.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
TABLE OF CONTENTS
FACTS RELATING TO THE OFFENCES
[10]
The waste management industry
[11]
Collections services and processing services in the Sydney region
[17]
The context and circumstances in which the arrangements were made
[25]
The making of the arrangements
[28]
Giving effect to the arrangements
[35]
Abandonment of the arrangements
[41]
The impact of the arrangements
[42]
THE OFFENCES
[44]
MAXIMUM PENALTIES
[49]
ADDITIONAL EVIDENCE ADDUCED BY THE PROSECUTOR
[52]
EVIDENCE ADDUCED BY THE ACCUSED
[55]
Evidence adduced by Bingo
[56]
Evidence adduced by Mr Tartak
[62]
COOPERATION AND GUILTY PLEAS
[71]
RELEVANT SENTENCING PROVISIONS AND PRINCIPLES
[83]
Matters which the Court must take into account
[85]
MAXIMUM PENALTIES
[89]
THE SENTENCE TO BE IMPOSED ON BINGO
[94]
Issues raised by the competing submissions
[95]
The objective seriousness of the offences in question
[96]
The nature and circumstances of the offence – s 16A(2)(a) of the Crimes Act
[97]
The duration and scale of the offending conduct
[102]
The extent to which the conduct was deliberate, systematic and covert
[105]
Seniority of the offending officer(s) and corporate culture
[108]
Benefits obtained as a result of the conduct
[110]
Injury, loss or damage resulting from the offence – s 16A(2)(e) of the Crimes Act
[116]
Course of conduct – s 16A(2)(c) of the Crimes Act
[122]
Overall assessment of the seriousness of the offences
[128]
Bingo’s subjective circumstances
[133]
Contrition and remorse – s 16A(2)(f) of the Crimes Act
[135]
Guilty plea – s 16A(2)(g) of the Crimes Act
[140]
Cooperation - s 16A(2)(h) of the Crimes Act
[144]
Character, antecedents, and prospects of rehabilitation – s 16A(2)(m) and (n) of the Crimes Act
[155]
Financial circumstances – s 16C of the Crimes Act
[158]
Deterrence – s 16A(2)(j) and (ja) of the Crimes Act
[160]
Need for adequate punishment – s 16A(2)(k) of the Crimes Act
[166]
Sentences imposed on corporations in other cartel offence cases
[167]
Totality
[172]
Parity
[173]
The appropriate sentence for Bingo
[187]
THE SENTENCE TO BE IMPOSED ON MR TARTAK
[191]
Issues raised by the competing submissions
[192]
Differences between Bingo’s offences and Mr Tartak’s offences
[201]
The objective seriousness of the offences
[206]
Other offences – ss 16A(2)(b) and 16BA of the Crimes Act
[212]
Mr Tartak’s subjective circumstances
[220]
Character and antecedents – s 16A(2)(m) of the Crimes Act
[221]
Contrition – s 16A(2)(f) of the Crimes Act
[224]
Prospect of rehabilitation – s 16A(2)(n) of the Crimes Act
[225]
Plea of guilty and cooperation – s 16A(2)(g) and (h) of the Crimes Act
[226]
Financial circumstances – s 16C of the Crimes Act
[232]
Deterrence – s 16A(2)(j) and (ja) of the Crimes Act
[233]
Other subjective considerations
[235]
Other sentencing considerations – totality and parity
[239]
Sentences imposed on individuals in other cartel cases
[245]
The appropriate sentence to impose on Mr Tartak
[257]
Is imprisonment the only appropriate sentence?
[260]
The appropriate term of the sentence of imprisonment
[268]
Should the Court make a recognizance release order?
[274]
Is it appropriate for imprisonment to be served by way of an intensive correction order?
[277]
Imposition of a fine
[290]
DISQUALIFICATION
[295]
CONCLUSION AND DISPOSITION
[303]
REASONS FOR JUDGMENT
WIGNEY J:
Bingo Industries Pty Limited and its former chief executive officer, Mr Daniel Charbel Tartak have each pleaded guilty to two cartel offences under the Competition and Consumer Act 2010 (Cth). The Court must now impose sentences in respect of those offences.
Bingo is a large waste management company based in New South Wales. At the time the cartel offences were committed, Bingo was a public company and was the largest provider of collections services and processing services for building and demolition waste in the Sydney metropolitan region. Collections services involved the collection and transportation of waste in skip bins to facilities for processing. Processing services involved sorting, processing, and recycling of the waste. Mr Tartak was Bingo’s chief executive officer at the time the offences were committed.
Many other small companies provided processing and collections services in Sydney. The second largest provider of collections services in Sydney at the time was Aussie Skips Bin Services Pty Ltd (Aussie Skips), though it had a significantly smaller market share than Bingo. A related company, Aussie Skips Recycling Pty Ltd (Aussie Recycling) was also a small provider of processing services in Sydney. Those two companies will collectively be referred to in these reasons as the Aussie Companies, other than where it is necessary to distinguish between them. Mr Emmanuel Roussakis was the chief executive officer of the Aussie Companies.
Over a five-day period commencing on 20 May 2019, Mr Tartak and Mr Roussakis engaged in a series of communications during which they made arrangements concerning the prices at which their respective companies would provide collections services and processing services. The essence of the arrangement in respect of collections services was that Bingo would maintain a price increase of 25% (or 23% in respect of its “top tier” customers) which it had advised its customers it would implement from 1 July 2019 and that Aussie Skips would increase its prices by at least 20%. The essence of the arrangement concerning processing services was that Bingo would maintain a price increase of at least $60/tonne and $35/m3 at its processing facilities which were near Aussie Recycling’s facility at Strathfield South and that Aussie Recycling would increase its prices at its Strathfield South facility by at least $50/tonne and $27.50/m3.
Over the following three months, Bingo, aided by Mr Tartak, gave effect to the arrangements that it had made with Aussie Skips and Aussie Recycling. As a result of the arrangements, there was a real chance that some customers would pay more than they otherwise would have paid for collections services and processing services.
Bingo was charged and pleaded guilty to an indictment containing one charge of intentionally making arrangements containing cartel provisions contrary to s 45AF(1) of the Competition and Consumer Act and one charge of giving effect to cartel provisions in arrangements contrary to s 45AG(1) of the Competition and Consumer Act. The particulars of those charges referred to both the arrangement containing the cartel provision concerning the prices for collections services and the arrangement containing the cartel provision concerning the prices for processing services.
Mr Tartak was similarly charged and pleaded guilty to an indictment containing two charges: a charge that he aided and abetted Bingo to contravene s 45AF(1) of the Competition and Consumer Act by making an arrangement containing a cartel provision; and a charge that he aided and abetted Bingo to contravene s 45AG(1) of the Competition and Consumer Act by giving effect to an arrangement containing a cartel provision. Those charges both concerned the arrangement with Aussie Skips which contained the cartel provision concerning the prices for collections services. Mr Tartak also asked the Court to take into account, in sentencing him for those offences, the fact that he admitted his guilt in respect of similar or corresponding offences relating to the arrangement with Aussie Recycling which contained the provision concerning the prices for processing services.
The task for the Court, in sentencing both Bingo and Mr Tartak in respect of the offences to which they have pleaded guilty, is to impose penalties that are of a severity appropriate in all the circumstances. The maximum penalty for each of the offences committed by Bingo is $40,200,000, being 10% of its annual turnover in the preceding 12-month period. The maximum penalty for the offences committed by Mr Tartak is a term of imprisonment not exceeding 10 years, or a fine not exceeding $420,000, or both.
The Prosecutor, the Commonwealth Director of Public Prosecutions, also applied for an order, pursuant to s 86E of the Competition and Consumer Act, the effect of which was to disqualify Mr Tartak from managing corporations for a period of five years.
FACTS RELATING TO THE OFFENCES
The primary facts relating to the offences upon which both Bingo and Mr Tartak are to be sentenced were for the most part not in dispute. The Prosecutor tendered separate statements of agreed facts in respect of Bingo and Mr Tartak. While there were some slight differences between those documents, those differences were largely immaterial for the purposes of sentencing. The facts relevant to the offences committed by each offender were essentially the same. Following is a short summary or distillation of the material facts. Unless stated otherwise, the facts relate to the period during which the offences were committed.
The waste management industry
The waste management industry in New South Wales generally dealt with three streams of waste: building and demolition waste, commercial and industrial waste, and municipal waste.
Companies in the waste management industry generally provided one or more of three types of services in respect of building and demolition waste: collections services, processing services, and disposal services.
Collections services, or skip bin services, involved the physical collection and transporting of building and demolition waste in skip bins to facilities for processing. Waste processors charged collectors a fee to accept and process the waste. Those fees were generally calculated by the tonnage of waste or the cubic metre size of the skip bin containing the waste.
Processing services, or “tipping”, involved the sorting, processing, and recycling of the waste. Material would be sorted into its component parts and any reusable material would be recycled or further processed and resold.
Disposal services involved disposing of residual waste that could not be recycled, primarily by way of landfill.
The pricing of the services in the industry were affected by landfill disposal costs. Those costs were to some extent passed through to recycling and collections pricing.
Collections services and processing services in the Sydney region
Bingo was the largest provider of collections services, including for mixed building and demolition waste in Sydney. It operated about 165 collections trucks and had an estimated market share of 22% in respect of collections services. In the 12 months preceding August 2018, its estimated revenue from collections services alone was $134 million.
Bingo was also the largest provider of processing services for mixed building and demolition waste. It operated nine processing facilities in the Sydney region. Those facilities were located at Greenacre, Revesby, Auburn, Alexandria, Artarmon, Smithfield, Eastern Creek, Minto, and St Marys. As at 22 November 2018, Bingo had approximately 21% of the market capacity to process mixed building and development waste in Sydney, based on the capacity of processing facilities.
Aussie Skips and Aussie Recycling were also waste management companies based and operating in New South Wales.
Aussie Skips provided collections services for building and demolition waste in Sydney. It operated about 25 collections trucks and had an estimated market share of 3% in respect of collections services. In the 12 months preceding August 2018, its estimated revenue from collections services was $26 million.
Aussie Recycling provided processing services for building and demolition waste. It operated one processing facility at Strathfield South, a suburb of Sydney. That facility was approximately one kilometre from Bingo’s Greenacre facility and about eight kilometres from Bingo’s Revesby and Auburn facilities.
Bingo competed with Aussie Skips in the market for collections services, and with Aussie Recycling in the market for processing services, in Sydney.
Many other companies provided collections services in Sydney. The next largest provider, a business known as Grasshopper, operated 18 trucks, had a market share of 2% and generated revenue of $12 million in the 12 months preceding August 2018. None of the other companies that provided collections services had a market share of more than 2%. Most had a market share of 1% or less.
Aside from Bingo and Aussie Recycling, about 13 other companies had building and demolition waste processing facilities in the Sydney region. Most of them had only one facility, though a few had two.
The context and circumstances in which the arrangements were made
Prior to 1 July 2019, many building and demolition waste processors in New South Wales, including Bingo and Aussie Recycling, transported and disposed of residual waste in Queensland landfills. That was generally a cheaper alternative to disposing of the waste in New South Wales landfills. That was because Queensland landfills did not have a waste levy, whereas New South Wales landfills did. In November 2018, however, the Queensland Government announced that it would re-introduce a waste levy, and in February 2019, the relevant legislation in Queensland was amended to re-introduce a waste levy of $75.00/tonne, commencing 1 July 2019.
The reintroduction of the waste levy in Queensland increased the costs for those waste management companies in New South Wales who had previously utilised landfills in Queensland. They no longer had access to levy-free landfills in Queensland. As a result, it was widely anticipated that waste management companies would have to increase their fees from July 2019.
On the afternoon of 20 May 2019, Bingo sent a letter to its customers which advised that it would increase its prices for both collections services and processing services from 1 July 2019. The precise timing of the sending of that letter is of some importance and is discussed later. The letter advised that there was to be a 25% price increase for collections services and that the price for processing services was to be increased by $35/m3 and $60/tonne for processing mixed building and demolition waste at Bingo’s Sydney processing facilities, other than Eastern Creek, where the fees would be increased by $28/m3 and $50/tonne. Those price increases were greater than the amount that was required to directly offset the anticipated additional costs arising from the reintroduction of the waste levy in Queensland.
The making of the arrangements
At 2.30pm on 20 May 2019, Mr Tartak and Mr Roussakis met at a café in Belfield, a suburb of Sydney. The meeting was held at Mr Tartak’s request. The events that followed that meeting support the inference that Mr Tartak and Mr Roussakis discussed the increased prices that Bingo and the Aussie Companies were proposing to charge for their services.
Bingo’s letter to its customers advising of its price increases was emailed to its customers shortly after that meeting.
Over the following days, Mr Tartak and Mr Roussakis engaged in a lengthy series of “WhatsApp” communications. WhatsApp is an encrypted text message service. Mr Roussakis also engaged in a series of WhatsApp communications with a senior employee of Bingo. That senior employee is referred to as AB in the agreed facts.
It is unnecessary to set out the full content of the various WhatsApp messages. It suffices to note that the overall effect of the communications was that Mr Tartak, on behalf of Bingo, agreed that Bingo would maintain its price increase of at least 25% for collections services that it had announced to its customers, save that the price increase could be as low as 22% for “top tier” customers, and Mr Roussakis agreed that Aussie Skips would increase its prices for collections services by at least 20%. It was also agreed that Bingo would maintain its price increase of at least $60/tonne and $35/m3 for processing services at its facilities near Aussie Recycling facility at Strathfield South and that Aussie Recycling would increase its prices by at least $50/tonne and $27.5/m3 for processing services at its Strathfield South facility.
Throughout his communications with Mr Roussakis, Mr Tartak encouraged Mr Roussakis, on behalf of the Aussie Companies, to adhere to the arrangements and “stick to [his] guns”. He also sought to reassure Mr Roussakis that Bingo would abide by the arrangements and confirmed that he would not “back paddle” [sic] when pressed by Mr Roussakis. Presumably Mr Roussakis meant back-pedal.
Mr Tartak was aware that the arrangements he made, on behalf of Bingo, with Mr Roussakis, on behalf of the Aussie Companies, had the purpose and likely effect of fixing the price of collections services and processing services that the companies provided to their customers. Mr Tartak was also aware that Bingo competed with the Aussie Companies in respect of the provision of those services.
On 24 May 2019, the Aussie Companies sent letters to its customers advising them of price increases consistent with those that were the subject of the arrangements between Mr Tartak and Mr Roussakis.
Giving effect to the arrangements
The WhatsApp communications between Mr Roussakis, on the one hand, and Mr Tartak and AB, on the other, continued after 24 May 2019. Commencing on around 30 May 2019, Mr Roussakis sent a number of WhatsApp messages to Mr Tartak, AB and others in an effort to arrange a meeting. That meeting eventually occurred at Mr Roussakis’s home on 4 June 2019. On the following day, Mr Tartak and Mr Roussakis exchanged WhatsApp messages in which they discussed their competitors’ pricing.
Mr Roussakis also exchanged WhatsApp messages with Mr Tartak on 24 June and 4 July 2019, sent WhatsApp messages to Mr Tartak on 24 July and 8 August 2019 and engaged in several WhatsApp exchanges with AB in June, July, and August 2019. Those WhatsApp messages and exchanges referenced the arrangements that had been made between Bingo and the Aussie Companies, discussed pricing, and included complaints, mainly by Mr Roussakis, that the Aussie Companies were losing customers. Some of the messages included suggestions or accusations, mostly by Mr Roussakis, but also in later messages by AB, that the arrangements were not being adhered to. Mr Roussakis also met with AB at a café on 12 June 2019.
Despite some of the claims made in the WhatsApp exchanges between Mr Roussakis, AB, and Mr Tartak, Bingo and the Aussie Companies generally adhered to, and gave effect to, the provisions in the arrangements concerning their pricing for collections services and processing services in the period from 24 May to 31 August 2019.
In Bingo’s case, it implemented and generally maintained the price increases in respect of its collections services that it had announced to its customers effective from 1 July 2019. The average price Bingo charged customers for building and demolition waste for the most common type of skip bin increased from approximately $790 in June 2019 to approximately $940 in July 2019, and $915 in August 2019. Throughout July and August 2019, Bingo charged approximately 42% of its customers, including some top tier customers, a price increase of at least 25% for at least one type of skip bin, though price increases varied in the case of other skip bins.
Bingo also implemented and generally maintained the price increases in respect of its processing services effective from 1 July 2019. The average price it charged account customers for processing building and demolition waste increased from $192.46/tonne in June 2019 to $246.70/tonne in July 2019, and $241.68/tonne in August 2019. Throughout July and August 2019, in most cases Bingo charged its account customers at its Greenacre, Revesby and Auburn facilities a price increase of at least $60/tonne or $35/m3 for processing services.
Mr Tartak assisted, and was knowingly involved, in Bingo’s adherence to the arrangements. He was, as chief executive officer, undoubtedly involved in pricing decisions and, as noted earlier, continued his communications with Mr Roussakis concerning the price increases during June, July, and August 2019.
Abandonment of the arrangements
The arrangements between Bingo and the Aussie Companies were effectively abandoned by about 1 September 2019. That was a product of both commercial considerations and the fact that, as had been adverted to in some of the WhatsApp exchanges referred to earlier, there were some instances of non-compliance with the arrangements, or at least allegations by each of the parties to the arrangements that the other party was not complying with the arrangements.
The impact of the arrangements
As a result of the arrangement between Bingo and Aussie Skips concerning their pricing in respect of collections services, there was a real chance that some customers of Bingo and Aussie Skips would pay more than they otherwise would have for collections services in Sydney. Mr Tartak and Bingo were aware that there was a real chance that the prices charged by Bingo and Aussie Skips for collections services pursuant to the arrangement would have an impact on the prices that their competitors charged their customers in Sydney.
Similarly, as a result of the arrangement between Bingo and Aussie Recycling concerning their pricing in respect of processing services, there was a real chance that customers of Aussie Recycling at its Strathfield South facility, and Bingo’s customers at its Greenacre, Revesby, and Auburn processing facilities (those being the facilities closest to Aussie Recycling’s Strathfield South facility) would pay more than they otherwise would have for processing services. There was also a possibility that those customers who tipped building and demolition waste at other processing facilities in Sydney could have paid prices different to those they would have paid had the arrangement not been made and implemented. Mr Tartak and Bingo were aware that there was a real chance that the prices charged by Bingo and Aussie Recycling for processing services pursuant to the arrangement would most likely have an impact on the prices that their competitors charged their customers in Sydney.
THE OFFENCES
The indictment presented against Bingo contained the following two charges:
1.Between about 20 May 2019 and about 24 May 2019 at Auburn in the State of New South Wales and elsewhere, Bingo Industries Pty Limited intentionally made an arrangement with each of Aussie Skips Bin Services Pty Ltd and Aussie Skips Recycling Pty Ltd which contained a cartel provision, knowing or believing that the arrangements each contained a cartel provision.
Contrary to section 45AF(1) of the Competition and Consumer Act 2010 (Cth).
Particulars of the Arrangements
a.Bingo Industries Pty Limited and Aussie Skips Bin Services Pty Ltd made an arrangement about the price of skip bin services in respect of mixed building and demolition waste in the Sydney Metropolitan region that:
i.Bingo Industries Pty Limited would maintain a price increase of at least 25% (save that the price increase may be as low as 22% for top tier customers); and
ii.Aussie Skips Bin Services Pty Ltd would increase its prices by at least 20%,
from at least 1 July 2019 (the Collections Arrangement).
b.Bingo Industries Pty Limited and Aussie Skips Recycling Pty Ltd made an arrangement about the price of processing services for the mixed building and demolition waste stream that:
i.Bingo Industries Pty Limited would maintain a price increase of at least $60/tonne and $35/m3 at its facilities proximate to Aussie Skips Recycling Pty Ltd's Strathfield South facility; and
ii.Aussie Skips Recycling Pty Ltd would increase its prices by at least $50/tonne and $27.50/m3 at its Strathfield South facility,
from at least 1 July 2019 (the Processing Arrangement).
2.From about 24 May 2019 until at least 31 August 2019 at Auburn in the State of New South Wales and elsewhere, Bingo Industries Pty Limited intentionally gave effect to cartel provisions contained in arrangements made with each of Aussie Skips Bin Services Pty Ltd and Aussie Skips Recycling Pty Ltd, knowing or believing that the arrangements each contained a cartel provision.
Contrary to section 45AG(1) of the Competition and Consumer Act 2010 (Cth).
Particulars
a.Bingo Industries Pty Limited gave effect to the cartel provision contained in the Collections Arrangement.
b.Bingo Industries Pty Limited gave effect to the cartel provision contained in the Processing Arrangement.
Bingo entered pleas of guilty to both charges.
The indictment presented against Mr Tartak included the following two charges:
1.Between about 20 May 2019 and about 24 May 2019 at Auburn in the State of New South Wales and elsewhere, Daniel Charbel Tartak did aid, abet, counsel or procure Bingo Industries Ltd to contravene a cartel offence provision, namely, section 45AF(1) of the Competition and Consumer Act 2010 (Cth), in that Bingo Industries Ltd intentionally made an arrangement with Aussie Skips Bin Services Pty Ltd containing a cartel provision, which to the knowledge or belief of Bingo Industries Limited and Daniel Charbel Tartak contained a cartel provision.
Contrary to section 45AF(1) with section 79(1)(a) of the Competition and Consumer Act 2010 (Cth).
Particulars of Arrangement
Between about 20 May 2019 and about 24 May 2019, Bingo Industries Ltd and Aussie Skips Bin Services Pty Ltd made an arrangement about the price of skip bin services in respect of mixed building and demolition waste in the Sydney Metropolitan region that:
a.Bingo Industries Ltd would maintain a price increase of at least 25% (save that the price increase may be as low as 22% for top tier customers); and
b.Aussie Skips Bin Services Pty Ltd would increase its prices by at least 20%,
from at least 1 July 2019 (the Collections Arrangement).
2.From about 24 May 2019 until at least 31 August 2019 at Auburn in the State of New South Wales and elsewhere, Daniel Charbel Tartak did aid, abet, counsel or procure Bingo Industries Ltd to contravene a cartel offence provision, namely, section 45AG(1) of the Competition and Consumer Act 2010 (Cth), in that Bingo Industries Ltd intentionally gave effect to the cartel provision contained in the Collections Arrangement, which to the knowledge or belief of Bingo Industries Ltd and Daniel Charbel Tartak contained a cartel provision.
Contrary to section 45AG(1) with section 79(1)(a) of the Competition and Consumer Act 2010 (Cth).
Mr Tartak entered pleas of guilty to each of those charges.
Mr Tartak also asked the Court to take into account, pursuant to s 16BA of the Crimes Act 1914 (Cth), two additional offences. Those two offences related to the arrangement entered into between Bingo and Aussie Recycling which contained the cartel provision concerning prices in respect of processing services. Those two offences were particularised in the following terms in the notice filed pursuant to s 16BA:
[Between about 20 May 2019 and about 24 May 2019, at Auburn, New South Wales and elsewhere,] Daniel Charbel Tartak was knowingly concerned in the contravention by Bingo Industries Ltd of a cartel offence provision, namely, section 45AF(1) of the Competition and Consumer Act 2010 (Cth), in that Bingo Industries Ltd intentionally made an arrangement with Aussie Skips Recycling Pty Ltd which contained a cartel provision, which to the knowledge or belief of Bingo Industries Limited and Daniel Charbel Tartak contained a cartel provision, contrary to section 45AF(1) with section 79(1)(a) of that Act.
Particulars
Daniel Charbel Tartak was knowingly concerned in Bingo Industries Ltd making an arrangement with Aussie Skips Recycling Pty Ltd about the price of processing services for the mixed building and demolition of waste stream that:
a.Bingo Industries Ltd would maintain a price increase of at least $60/tonne and $35/m3 at its facilities proximate to Aussie Skips Recycling Pty Ltd’s Strathfield South facility; and
b.Aussie Skips Bin Services Pty Ltd would increase its prices by at least $50/tonne and $27.50m3 at its Strathfield South facility,
from 1 July 2019 (the Processing Arrangement).
[From about 24 May 2019 until at least 31 August 2019, at Auburn, New South Wales and elsewhere] Daniel Charbel Tartak was knowingly concerned in the contravention by Bingo Industries Ltd of a cartel offence provision, namely, section 45AG(1) of the Competition and Consumer Act 2010 (Cth), in that Bingo Industries Ltd intentionally gave effect to the cartel provision contained in the Processing Arrangement, which to the knowledge or belief of Bingo Industries Ltd and Daniel Charbel Tartak contained a cartel provision, contrary to section 45AG(1) with section 79(1)(c) of that Act.
MAXIMUM PENALTIES
At the time Bingo committed the offences, the maximum penalty for an offence committed against each of ss 45AF(1) and 45AG(1) was a fine not exceeding the greater of: $10,000,000; or, if the court can determine the total value of the benefits that were obtained by one or more persons and that are reasonably attributable to the commission of the offence, three times that total value; or, if the court cannot determine the total value of those benefits, 10% of the corporation’s annual turnover during the 12‑month period ending at the end of the month in which the corporation committed, or began committing, the offence: ss 45AF(3) and 45AG(3) of the Competition and Consumer Act.
The Prosecutor and Bingo agreed that it was not possible to determine the total value of the benefits obtained by Bingo that were reasonably attributable to the commission of the offences. The Prosecutor and Bingo also agreed that Bingo’s annual turnover during the 12-month period ending on the date the offences were committed was $402 million. It follows that the maximum penalty for each of the offences committed by Bingo is $40,200,000.
A person who is not a body corporate and who, by virtue of having aided, abetted, counselled, or procured a person to commit a cartel offence provision, is taken to have contravened that provision, is punishable by a term of imprisonment not exceeding 10 years or a fine not exceeding 2,000 penalty units, or both: s 79(1) of the Competition and Consumer Act. A penalty unit at the time Mr Tartak aided and abetted Bingo’s commission of the two cartel offences was $210. It follows that the maximum penalty in respect of each of the offences committed by Mr Tartak is 10 years imprisonment, or a fine of $420,000, or both.
ADDITIONAL EVIDENCE ADDUCED BY THE PROSECUTOR
The Prosecutor relied on affidavit evidence from an Australian Competition and Consumer Commission (ACCC) investigator, Mr Blake Donald. That evidence was primarily adduced in respect of the case against Bingo and mainly concerned the extent to which Bingo had cooperated with the ACCC’s investigation into their offending conduct.
Mr Donald’s evidence, in summary, was that on 4 December 2019 he executed a search warrant at Bingo’s business premises in Auburn. That search warrant had been issued to Mr Donald pursuant to s 154X of the Competition and Consumer Act. The ACCC subsequently issued and served on Bingo a series of notices under s 155 of the Competition and Consumer Act. Those notices, which were dated 6 November 2020, 26 February 2021, 30 March 2021, and 28 April 2021, required Bingo to furnish specified information and produce specified documents relevant to the ACCC’s investigation. Bingo complied with those notices. On 11 December 2020, the ACCC sent letters to the legal advisers who were acting for Bingo and Mr Tartak. Those letters outlined the ACCC’s allegations concerning cartel conduct by Bingo and Mr Tartak. Mr Tartak was invited to cooperate by attending an interview.
The Prosecutor also separately tendered, in its case against Mr Tartak, a letter signed by Mr Donald which concerned the assistance that Mr Tartak had provided to the ACCC in its investigation. The letter was tendered in a manner which suggested that its contents were confidential, though the nature and quality of Mr Tartak’s assistance was referred to openly in the parties’ submissions. Mr Tartak’s assistance and cooperation is a topic which is addressed separately, and in more detail, later in these reasons.
EVIDENCE ADDUCED BY THE ACCUSED
Both Bingo and Mr Tartak adduced evidence in support of their plea in mitigation.
Evidence adduced by Bingo
Bingo adduced affidavit evidence from Mr Christopher Jeffrey, who was appointed chief executive officer of Bingo in September 2021. Mr Jeffrey apologised unreservedly on behalf of Bingo for the conduct which resulted in its conviction and its failure to comply with competition law. His evidence was that that conduct does not reflect Bingo’s values. Mr Jeffrey stated that, in his position as chief executive officer, he reinforced what he referred to as Bingo’s “Zero Harm” focus, a key pillar of which was compliance with the law. According to Mr Jeffrey, Bingo recognises that the conduct which resulted in its conviction was unacceptable and should not have occurred.
Perhaps more significantly, Mr Jeffrey’s evidence was that Bingo, with the full support of its board of directors, had taken active steps to ensure that the offending conduct does not occur again. Those steps included: allocating additional resources to support compliance with competition law; retaining external legal advisers to identify and implement necessary improvements to Bingo’s competition compliance processes; establishing and implementing processes and procedures which govern the way in which Bingo and its personnel engage with Bingo’s competitors; implementing processes to monitor dealings with competitors; directing that Bingo’s employees not use WhatsApp or other messaging formats for business communications; the rolling-out of a comprehensive competition compliance training to all Bingo sales and executive team members in New South Wales and Victoria; the appointment of a new risk and compliance manager who reports to the general counsel; and the implementation of annual quality assurance reviews during which each sales team member is required to confirm their compliance with internal processes and policies, including those concerning competition law.
Mr Jeffrey also stated that the composition of Bingo’s board of directors had changed in August 2021. A new independent chair was appointed along with three new directors. Mr Tartak stepped down from his role as chief executive officer of Bingo in September 2021 and he stepped down from the boards of all “Bingo entities” in May 2022. The Bingo board initially resolved to ‘freeze’ certain financial incentives that were otherwise payable to Mr Tartak pending the ACCC investigation. Those financial incentives, which exceeded $4 million, were ultimately not paid to Mr Tartak. Finally, Mr Jeffrey noted that, apart from the matters the subject of this proceeding, Bingo has not been the subject of any proceedings alleging a contravention of the Competition and Consumer Act.
Bingo also adduced affidavit evidence from Mr Stephen Schmidhofer, who has held the position of general counsel and company secretary of Bingo since January 2019. In early 2020, shortly after the search warrant was executed at Bingo’s premises, Mr Schmidhofer was responsible for engaging external advisers and considering what improvements could be made to Bingo’s compliance program. Mr Schmidhofer candidly conceded that competition compliance had not been a focus at Bingo until after the commencement of the ACCC investigation. The primary focus of the compliance program up until then had been occupational health and safety and environmental compliance.
In June 2020, Mr Schmidhofer was involved, with the assistance of external advisers, in the presentation of competition compliance training for Bingo employees. The training focused on the management of interactions between Bingo’s sales staff and Bingo’s competitors, particularly in circumstances where the competitors were also customers. Mr Schmidhofer’s evidence was that Bingo has since “rolled-out” comprehensive competition compliance training to Bingo staff and executive team members in New South Wales, Victoria and Queensland. Mr Schmidhofer also noted that an internal risk and audit manager had been appointed in January 2020. The “key focus” of that role was said to be “to embed a risk and compliance focus across the business and further develop effective controls to manage key risks”.
Mr Jeffrey and Mr Schmidhofer were not cross-examined, and their evidence was not otherwise the subject of any substantive challenge or criticism.
Evidence adduced by Mr Tartak
Mr Tartak tendered eleven letters or references from various people that attested to his good character. Those letters included letters from his spouse, former and current leaders of his former school and the school currently attended by three of his sons, leaders from his church community, business colleagues and associates, and officers of charitable organisations which he has assisted and supported. All the authors of the letters and reports were aware of the offences committed by Mr Tartak.
It is possible to shortly summarise those letters and references because they essentially speak with one voice. That is not to downplay their impressive nature and significance.
There could be no doubt that, putting to one side the offences currently under consideration, Mr Tartak is a man of good character with many laudable qualities. He is well-respected by those who know him well. He has been married for over a decade and has five children: four sons and a daughter. He is a devoted, supportive, and loving husband and father. One of his children has a medical condition which has undoubtedly given rise to additional parental responsibilities and pressures.
He is a distinguished alumnus of the well-regarded school he attended. He maintains a close contact with that school. He excelled at school and was vice-captain in his senior year. The current headmaster of the school spoke of Mr Tartak’s ongoing support for the school and its philanthropic endeavours.
He is a valued member of his church community. His parish priest always found him to be a “dedicated, responsible, honest, and reliable person with good morals and spiritual character”. He has served on parish committees, has volunteered his time, and has donated to charities associated with the church.
Mr Tartak’s business colleagues and associates respected and admired his work-ethic, motivation, commitment, and diligence. They spoke of the pressure and anxiety he suffered upon his appointment as a relatively young and inexperienced chief executive officer of a public company. They also spoke of Mr Tartak’s philanthropic and charitable endeavours.
Leaders of a wide range of charities that Mr Tartak has assisted and supported over the years referred to his outstanding contribution to those charities.
A consistent theme of the letters and references is that Mr Tartak’s offending conduct was out of character and came as a considerable surprise to those who knew him. Each of the authors also referred to Mr Tartak’s feelings of shame, regret and remorse in having committed the offences. As his wife put it:
It is hard to overstate [Mr Tartak’s] feeling of great shame at having fallen from the position for which he was so admired and respected by our family and friends. He reproaches himself constantly and feels great regret for his actions and the effect it has had on both the family he loves so much and everyone else affected by them.
The evidence concerning Mr Tartak’s sense of shame and remorse was supported by the opinion evidence of a psychologist who Mr Tartak consulted following his conviction. In his report, which was tendered without objection, the psychologist also expressed the opinion, based on his forensic interview and clinical assessment of Mr Tartak, that in the period leading up to and during the commission of the offences, Mr Tartak was suffering from an “Adjustment Disorder with Anxiety … secondary to high-level work and major family stressors”. Mr Tartak’s stressors at the time included: a higher-than-normal level of work demands; escalating concern for the well-being of his wife and children; the special needs of his son who was born with a medical condition; the deteriorating health and ultimate passing of his sister-in-law; and fatigue and sleep deprivation. According to the psychologist, the “accumulation and enmeshing of the major stressors over a protracted period led to the development” of the adjustment disorder. The psychologist was not cross-examined, and his evidence was not otherwise disputed.
COOPERATION AND GUILTY PLEAS
Bingo and Mr Tartak first became aware of the ACCC’s investigation into their cartel conduct when the search warrant was executed at Bingo’s business premises on 4 December 2019. On 11 December 2020, the ACCC wrote to Mr Tartak, through his legal representatives, and invited him to participate in an interview. That invitation was declined in March 2021, however Mr Tartak’s legal representatives invited further dialogue with the ACCC concerning the ACCC’s investigation.
Between June 2021 and August 2021, the ACCC, legal representatives for Bingo, and legal representatives for Mr Tartak, had several discussions about the ACCC’s investigation, including the charges to which Bingo and Mr Tartak may be willing to plead guilty, and the form of any cooperation that Bingo and Mr Tartak may be able to provide the ACCC. Mr Tartak was still chief executive officer of Bingo at that time. Mr Tartak indicated that he could potentially encourage the Aussie Companies and Mr Roussakis to approach the ACCC and enter negotiations. He also indicated that he could potentially provide an induced statement to the ACCC.
In July 2021, the ACCC was told that Mr Tartak’s legal advisers had contacted the legal advisers acting for Mr Roussakis and the Aussie Companies. ACCC investigators subsequently contacted and engaged in discussions with those legal advisers. Mr Roussakis, Aussie Skips and Aussie Recycling were eventually charged with cartel provision offences in late 2022. They entered pleas of guilty to the charges in an amended indictment in early 2023.
On 1 September 2021, legal officers in the Prosecutor’s office engaged in separate plea negotiations with the legal representatives of Bingo and Mr Tartak.
On 15 September 2021, Mr Tartak stepped down as chief executive officer of Bingo. He resigned as a director of Bingo and related companies effective from 9 June 2022.
The plea negotiations between the Prosecutor’s office and the separate legal representatives of Bingo and Mr Tartak continued until 16 August 2022, when the parties each signed an agreed statement of facts and the Prosecutor filed indictments in this Court. There were no committal proceedings.
Bingo entered pleas of guilty to the charges in the indictment referrable to him on 16 August 2022.
Mr Tartak entered pleas of guilty to the charges in the indictment referrable to him on 20 October 2022.
Mr Tartak also participated in interviews with the ACCC on 7 and 9 November 2022. He signed an induced statement on 11 November 2022. On 6 February 2023, he signed an undertaking pursuant to s 16AC of the Crimes Act.
As noted earlier, the Prosecutor tendered a letter signed by an ACCC investigator, Mr Donald, which referred to and assessed the substance and quality of the cooperation and assistance provided to the ACCC by Mr Tartak. According to Mr Donald, the main elements of the assistance provided by Mr Tartak were his participation in an interview with the ACCC, his provision of an induced statement, and the steps he took to encourage the Aussie Companies and Mr Roussakis to engage in discussions or negotiations with the ACCC.
In relation to the interview and induced statement, Mr Donald noted that the ACCC investigators had no reason to doubt that Mr Tartak had been “full and frank in his disclosures”, and that Mr Tartak had provided some “material information regarding the offending conduct which was not previously known to the ACCC”. The information provided by Mr Tartak otherwise corroborated evidence already known to and held by the ACCC. Mr Donald stated, however, that Mr Tartak’s evidence had not been used in any current ACCC investigation and was unlikely to be used in any future investigation.
Ultimately, Mr Donald assessed the value of the assistance provided by Mr Tartak as being of “medium value”.
RELEVANT SENTENCING PROVISIONS AND PRINCIPLES
The statutory provisions pursuant to which Bingo and Mr Tartak are to be sentenced are primarily found in Pt IB of the Crimes Act.
The overarching principle in Pt IB is that any sentence imposed by the Court must be of a “severity appropriate in all the circumstances of the offence”: s 16A(1) of the Crimes Act.
Matters which the Court must take into account
Section 16A(2) of the Crimes Act details the matters that the Court must take into account so far as they are relevant and known to the Court. Those matters relevantly include: the nature and the circumstances of the offence; other offences (if any) that are required or permitted to be taken into account; if the offence forms part of a course of conduct, that course of conduct; the personal circumstances of any victim of the offence; any injury, loss or damage resulting from the offence; the degree to which the offender has shown contrition for the offence; if the offender has pleaded guilty, that fact; the degree to which the offender has cooperated with law enforcement agencies in the investigation of the offence or other offences; the deterrent effect of any sentence on the offender or any other person; the need to ensure that the offender is adequately punished for the offence; the character and antecedents of the offender; and the prospect of rehabilitation of the offender.
The Court must identify and ascribe weight to the relevant factors and make a value judgment as to what is the appropriate sentence given those factors; a process sometimes referred to as “instinctive synthesis”: Markarian v The Queen (2005) 228 CLR 357; [2005] HCA 25 at [51].
The factors that are of relevance in sentencing Bingo and Mr Tartak are specifically identified and considered later in these reasons.
The “checklist” of matters detailed in s 16A(2) does not exclude other relevant considerations, including common law sentencing principles: Director of Public Prosecutions (Cth) v El Karhani (1990) 97 ALR 373; 21 NSWLR 370 at 377-378; Bui v Director of Public Prosecutions (Cth) (2012) 244 CLR 638; [2012] HCA 1 at [18]; Johnson v The Queen (2004) 218 CLR 451; [2004] HCA 15 at [15]. Sentencing principles such as totality and proportionality are important considerations in fixing a sentence of a severity appropriate in all the circumstances: Hili v The Queen (2010) 242 CLR 520; [2010] HCA 45 at [25]; Wong v The Queen (2001) 207 CLR 584; [2001] HCA 64 at [78].
Maximum penalties
The maximum penalty for an offence is often viewed as a “yardstick” that bears on the ultimate discretionary determination of the sentence for the offence: Elias v The Queen (2013) 248 CLR 483; [2013] HCA 31 at [27]. It can also be taken to represent the legislature’s assessment of the seriousness of the offence: Muldrock v The Queen (2011) 244 CLR 120; [2011] HCA 39 at [31]. The maximum penalty, however, is only one of many factors that should be taken into account when determining the appropriate sentence. In some cases, and in some circumstances, it may provide little to no assistance: Markarian at [65]; R v Geddes (1936) 36 SR (NSW) 554 at 555-556. As the High Court has observed, “[i]t is wrong to suggest that the court is constrained, by reason of the maximum penalty, to impose an inappropriately severe sentence on an offender for the offence for which he or she has been convicted”: Elias at [27].
The maximum penalty for an offence against ss 45AF and 45AG of the Competition and Consumer Act is not a single specified sum or formula. The provision instead provides for alternative maximum penalties.
As discussed earlier, the maximum penalty in Bingo’s case is based on its annual turnover, as defined in s 45AB of the Competition and Consumer Act. That is because, as was agreed by the parties, it was not possible to determine the total value of the benefits obtained by one or more persons that were reasonably attributable to the commission of the offence, and 10% of Bingo’s agreed annual turnover was greater than the sum of $10,000,000: see ss 45AF(3) and 45AG(3) of the Competition and Consumer Act.
The relevance of this basis of assessment of the maximum penalty was explained in Commonwealth Director of Public Prosecutions v Kawasaki Kisen Kaisha Ltd (2019) 137 ACSR 575; [2019] FCA 1170 (CDPP v K-Line) at [274] as follows (see also Commonwealth Director of Public Prosecutions v Nippon Yusen Kabushiki Kaisha (2017) 254 FCR 235; [2017] FCA 876 (CDPP v NYK) at [211]):
One can readily comprehend why the legislature chose to include a maximum penalty for cartel offences which may be based on the offending corporation’s annual turnover. Specific deterrence is a major consideration in determining the appropriate size of the fine to impose in relation to a cartel offence. The fine should be such as to ensure that the penalty is not to be regarded by the offender or others as an acceptable cost of doing business. The sum required to achieve that objective will generally be larger where the offending corporation is a very large corporation, as may be reflected in its annual turnover. That said, in some cases a maximum penalty based on the offending corporation’s annual turnover may not provide a realistic guide to the objective seriousness of the offending conduct or criminality involved in the offence. It is, for example, possible to imagine a case where a large corporation with a very high annual turnover committed a single relatively minor offence against s 44ZZRG [now s 45AG] of the [Competition and Consumer Act].
As indicated earlier, in Mr Tartak’s case, the maximum penalty is imprisonment not exceeding 10 years, or a fine not exceeding $420,000, or both.
THE SENTENCE TO BE IMPOSED ON BINGO
As discussed earlier, the appropriate course to adopt in determining the appropriate sentence to impose on Bingo is to identify and ascribe weight to the relevant factors, including, but not necessarily limited to, those referred to in s 16A(2) of the Crimes Act. Those factors may conveniently be categorised as those that are relevant to the objective seriousness of the offences and the offending conduct and those that concern the subjective or personal circumstances of the offender in question.
Issues raised by the competing submissions
The main issues that divided the parties in respect of the appropriate sentence for Bingo concerned the seriousness of the offences and the nature and extent of Bingo’s cooperation with the authorities. Bingo submitted that, while the offences it committed were serious, they were nevertheless towards the “lower to mid-range” end of the scale having regard to the limited nature, duration and scope of the arrangements. Bingo also emphasised that it was not possible to identify any real benefit derived from the offences, or any harm to consumers caused by the offences. Bingo also took issue with the Prosecutor’s characterisation of the conduct in question as systematic.
The objective seriousness of the offences in question
The factors that are generally relevant to assessing the seriousness of the offences include: the nature and circumstances of the offence; the duration and scale of the offences; the extent to which the offences were deliberate, systematic and covert; the nature and extent of any benefits obtained as a result of the offence; any loss or damage caused by the offence; and whether the offences formed part of a course of conduct.
The nature and circumstances of the offence – s 16A(2)(a) of the Crimes Act
Section 16A(2)(a) provides that the Court must take into account “the nature and circumstances of the offence”.
Cartel conduct generally involves anti-competitive conduct of a very serious nature that should be emphatically condemned and deterred by the imposition of appropriately stern penalties. Such conduct is “extremely destructive of the competition on which the prosperity of a free market economy depends”: Australian Competition and Consumer Commission v Visy Industries Holdings Pty Limited (No 3) (2007) 244 ALR 673; [2007] FCA 1617 at [306]. It can “never really be considered as anything other than serious”: Australian Competition and Consumer Commission v ABB Transmission and Distribution Limited (No 2) (2002) 190 ALR 169; [2002] FCA 559 at [13]. While Visy and ABB were both civil penalty cases, the observations concerning the seriousness of cartel conduct apply equally to cartel offences.
Prior to 2009, cartel conduct attracted only civil penalties. The fact that cartel conduct was criminalised in 2009 no doubt reflects the fact that Parliament regarded it as sufficiently serious to attract “opprobrium and societal condemnation in a way that the imposition of a civil penalty cannot”: CDPP v NYK at [215]-[216]; see also [1], where the Minister’s Second Reading Speech in respect of the Bill that criminalised cartel conduct is reproduced; see also CDPP v K-Line at [275], [278].
The objective seriousness of cartel offences is reflected in the substantial maximum penalties. It is, however, undoubtedly necessary to have regard to the specific facts and circumstances of the offences committed by the offender in question.
As has already been noted, the factors or considerations which are generally considered to be relevant in assessing the objective seriousness of cartel offences include: the duration and scale of the offending conduct; the extent to which the conduct was deliberate, systematic and covert; the seniority of the officers or employees involved in the offences; the existence or otherwise of any corporate culture of compliance; the profit or benefit attributable to the conduct; and any loss or damage arising from the conduct: see CDPP v NYK at [219]-[220]; CDPP v K-Line at [279]-[281]; Commonwealth Director of Public Prosecutions v Wallenius Wilhelmsen Ocean AS (2021) 386 ALR 98; [2021] FCA 52 (CDPP v WWO) at [174]-[175].
The duration and scale of the offending conduct
The duration of the offending conduct was a little over three months. Bingo made the arrangements with the Aussie Companies between 20 and 24 May 2019 and gave effect to the cartel provisions from about 24 May to about 31 August 2019. The arrangements were effectively abandoned by 1 September 2019. The cartel arrangements did not cease because the participants recognised that what they had been doing was wrong or for any altruistic reasons. Rather, the arrangements were abandoned for reasons of commercial self-interest and because one or other of participants began to independently depart from the arrangements, or at least perceived that the other participant was cheating on the arrangements.
It may be accepted that the duration of the cartel arrangements in question was not as long as the cartel arrangements in most of the other reported cartel offence cases, including the cases concerning the shipping cartel: CDPP v NYK; CDPP v K-Line, and CDPP v WWO. The duration of the arrangements nevertheless could not really be said to be insubstantial or “very short” as Bingo submitted. I also do not consider that there is much to be gained from comparing the circumstances of this case with other cartel cases.
Bingo also placed some reliance on the fact that the scope of the cartel arrangements was limited to Sydney, or in the case of the arrangement concerning processing services, that part of Sydney near Strathfield South, and involved only two participants in the relevant waste management services markets in that region. It may be accepted that the nature and scope of the cartel arrangements were limited in that respect, however the market for waste management services in Sydney was nevertheless substantial and lucrative, a fact revealed by the revenue earned by Bingo ($134 million) and Aussie Skips ($26 million) in respect of collections services in Sydney in the 12-month period preceding August 2018. While the arrangements in question were only between two participants, those two participants were effectively the largest two participants in the market for collections services and one of those participants, Bingo, had by far the largest market share or capacity in both the market for collections services (about 22-24% market share) and the market for processing services (about 21% of the market capacity).
The extent to which the conduct was deliberate, systematic and covert
Cartels, by their very nature, generally involve deliberate conduct and require a significant degree of planning and deliberation. They are also likely to be covert and involve conduct which is engaged in such a way as to avoid detection by regulatory authorities: CDPP v NYK at [239]; CDPP v K-Line at [298].
There could be little doubt that Bingo’s conduct, through Mr Tartak, was deliberate. It may be inferred from the nature and content of Mr Tartak’s communications with Mr Roussakis that Mr Tartak knew what he was doing and well-knew that it was wrong. There likewise could be little doubt that the conduct which gave rise to the cartel arrangements, and the way in which those arrangements were implemented, was covert. The meetings that Mr Tartak had with Mr Roussakis did not occur on either of their business premises and most of their communications took place over WhatsApp, which, as noted earlier, is an encrypted messaging application the records of which cannot be readily accessed by persons other than those who participate in the communications. The arrangements were not otherwise recorded or documented. Knowledge of the arrangements was also confined to a very small number of people, no doubt deliberately so.
It is, however, difficult to see how the arrangements could fairly or accurately be characterised as systematic, as contended by the Prosecutor. The arrangements were made, and the cartel provisions were given effect to, essentially through a few meetings between Mr Tartak and Mr Roussakis and a series of WhatsApp messages. The meetings and communications were somewhat ad-hoc and somewhat unsophisticated. No sophisticated, organised or methodical systems were put in place to monitor the arrangements. That perhaps also goes some way towards explaining how and why the arrangements ultimately broke down.
Seniority of the offending officer(s) and corporate culture
This was not a case where the cartel arrangements were made and given effect to by lower-level management. The arrangements were made between the chief executive officers of Bingo and the Aussie Companies respectively. That is particularly significant in Bingo’s case as it was a public company at the time the offences were committed. There is, however, no suggestion that any members of Bingo’s board of directors were aware of the arrangements, let alone authorised or sanctioned them.
It is also readily apparent that at the time the offences were committed, Bingo did not have any compliance programs which specifically addressed competition issues and concerns. Nor is there any evidence to suggest that there was any corporate culture at Bingo concerning compliance with competition law. Indeed, the fact that Bingo’s chief executive officer engaged in the offending conduct would tend to confirm that that there was no culture of compliance at Bingo, at least in respect of competition issues and concerns.
Benefits obtained as a result of the conduct
In assessing the seriousness of a cartel offence, it is relevant to have regard to any benefits that the offender obtained as a result of the offence. That is no doubt why one of the methods by which the maximum penalty may be calculated involves the determination of the financial benefits that were obtained as a result of the offence. Experience shows, however, that it is frequently very difficult to calculate or quantify, in monetary terms, the benefits obtained that may be said to be reasonably attributable to the commission of the offence.
This is such a case. The parties agree that it is not possible to determine the monetary value of any benefits obtained by Bingo that are reasonably attributable to the offence. It does not follow, however, that Bingo did not derive any benefits from the offences it committed. Nor does it follow that the offences committed by either Bingo or Mr Tartak cannot be said to be serious: CDPP v WWO at [223]; Commonwealth Director of Public Prosecutions v Alkaloids of Australia Pty Ltd [2022] FCA 1424 at [89] (CDPP v Alkaloids). The benefits that a corporation may derive from a cartel are not limited to quantifiable financial benefits, but include more intangible, but nonetheless extremely valuable, benefits: CDPP v NYK at [247]; CDPP v K-Line at [307]; CDPP v Alkaloids at [89]-[91].
It can be inferred from the facts of this case that Bingo benefitted from the cartel arrangements, albeit in a way that cannot be precisely quantified. First, Bingo increased its prices. It is true, as Bingo submitted, that Bingo had already effectively determined that it was going to increase its prices in the face of the reintroduction of the waste levy by the Queensland government. It would appear, however, that Bingo’s price increases were higher than the amount that was required to directly offset its additional costs arising from the levy and other regulatory changes that occurred at the time. It is also clear that Bingo only communicated its price increases to its customers after Mr Tartak had met with Mr Roussakis at 2.30pm on 20 May 2019. While other cost and commercial considerations may well have fed into Bingo’s pricing decisions at the time, it is difficult to accept that the price increases that Bingo ultimately conveyed to its customers were not materially influenced by the cartel arrangements.
More significantly, it can readily be inferred that the main point of the cartel arrangements that Bingo made with the Aussie Companies was to avoid the loss of customers which might otherwise have occurred if Bingo unilaterally increased its prices. It may readily be inferred that Mr Tartak and Mr Roussakis believed that if Bingo and the Aussie Companies coordinated their price increases, it was less likely that they would lose customers, not only to each other, but to other suppliers. As Mr Roussakis put it in one of his communications with Mr Tartak: “[w]e need to be on the same page if this is going to work”. Mr Tartak agreed.
While of course there were other service providers, the available inference is that Mr Tartak believed that if both Bingo and the Aussie Companies increased their prices, or maintained their increased prices, as they had agreed, the other smaller service providers would soon follow. There was a sound basis for that belief. There was at the very least a real chance that the prices charged by the two largest providers of collections services in the region would have an impact on how other competitors decided to set their prices.
It may accordingly be inferred that, while it is not possible to quantify the benefit derived by Bingo from its offending conduct, Bingo nevertheless derived benefits because it was able to increase its prices without losing the customers it might otherwise have lost if it had unilaterally increased its prices. That was the very point of the arrangements. It may readily be inferred that Bingo would not have continued to give effect to the arrangements for over three months if it was not deriving, or did not believe it were deriving, any benefit from them.
Injury, loss or damage resulting from the offence – s 16A(2)(e) of the Crimes Act
Section 16A(2)(e) provides that the Court must take into account “any injury, loss or damage resulting from the offence”.
It is common ground that it is not possible to calculate or quantify any loss that may have been suffered by anyone as a direct result of the offences committed by Bingo and Mr Tartak. It does not follow, however, that Bingo and Mr Tartak should be sentenced on the basis that their offending caused no injury, loss or damage.
As has already been noted, Bingo notified its customers that it was increasing its prices at about the time it made the cartel arrangements. The Aussie Companies also increased their prices following the making of the cartel arrangements. There was also a real risk that the increased prices charged by Bingo and the Aussie Companies would have an impact on the prices that other suppliers charged their customers.
There was also no dispute that one of the impacts of the cartel arrangements was that there was a real chance that some consumers of collections services in Sydney paid more for those services than they otherwise would have, and that some consumers of processing services at Bingo’s processing facilities at Greenacre, Revesby and Auburn, and Aussie Recycling’s processing facility at South Strathfield, paid more than they otherwise would have for processing services. It is, however, not possible to identify any specific customers who in fact paid more for the relevant services, and not possible to quantify the price increases that can be reasonably attributed to the cartel arrangements.
The fact that it is not possible to identify or quantify any direct detrimental price effect on Bingo’s customers arising from the cartel arrangements does not significantly detract from the seriousness of the offending conduct. Nor does it follow that the cartel arrangements in question had a “limited impact” as Bingo submitted. The fact remains that the impact of the cartel arrangements was that price competition in the not insubstantial market for collections services in Sydney was reduced and distorted for a not insubstantial period, as was price competition in the market for processing services in part of that region. It may readily be inferred that the reduction of price competition would have had an adverse impact on at least some consumers of those services in those regions.
In relation to loss or damage to the relevant markets and the economic system generally, as was said in CDPP v WWO (at [242]): “[c]artel conduct, like other anti-competitive behaviour, is inimical to, destructive of and may lead to a loss of public confidence in, Australia’s markets and economic system”. The cartel arrangements in question in this matter undoubtedly suppressed and distorted price competition in the important markets for waste collections and processing services in Sydney.
Course of conduct – s 16A(2)(c) of the Crimes Act
Section 16A(2)(c) provides that “if the offence forms part of a course of conduct, consisting of a series of criminal acts of the same or similar character – that course of conduct” must be taken into account.
The offences committed by Bingo could be said to form part of a course of conduct consisting of a series of criminal acts of a similar nature.
Both offences committed by Bingo could fairly be characterised as being “rolled-up” offences. A rolled-up charge or offence is generally one where, while only one offence is charged, the particulars involve multiple acts each of which is capable of constituting a separate and discrete offence: see CDPP v K-Line at [269]. The offences committed by Bingo are rolled-up offences because the particulars to each of the offences refer to two separate arrangements each of which contained a cartel provision. One of those arrangements was the arrangement between Bingo and Aussie Skips which contained a cartel provision concerning their prices for collections services. The other arrangement was the arrangement between Bingo and Aussie Recycling which contained a cartel provision concerning their prices in respect of processing services. Each of those arrangements could have been the subject of a separate charge.
The correct approach to take when imposing a sentence for a rolled-up offence was outlined as follows in CDPP v K-Line at [270]:
In sentencing a rolled-up charge, the Court is required to assess the criminality of an offender’s conduct as particularised. The issue for the Court on sentence is the criminality disclosed by the offence, not the number of charges: R v Knight [2004] NSWCCA 145 at [25]-[26]. The more contraventions or episodes of criminality that form part of the rolled-up charge, the more objectively serious the offence is likely to be: R v Richard [2011] NSWSC 866 at [65(f)]; R v Glynatsis [2013] NSWCCA 131; 230 A Crim R 99 at [66]; R v De Leeuw [2015] NSWCCA 183 at [116]. That said, the maximum penalty for the rolled-up charge is the maximum penalty for one offence, not the aggregate of the penalties for what could have been charged as separate offences: R v Richard at [105]; R v Donald [2013] NSWCCA 238 at [85].
In Bingo’s case, while each of the offences in fact involves two “criminal acts” of a similar character, because they involved two separate arrangements, those criminal acts formed part of a single course of conduct. In relation to the offence under s 45AF(1) of the Competition and Consumer Act, both arrangements were made in the course of the meetings and WhatsApp messages between Mr Tartak and Mr Roussakis between 20 and 24 May 2019. Those meetings and communications effectively constituted a single course of conduct. Mr Tartak and Mr Roussakis did not have separate meetings and communications in respect of the two arrangements. Likewise, both arrangements were given effect to in the course of meetings and WhatsApp communications between Mr Tartak (and in some instances AB) and Mr Roussakis between 24 May and 8 August 2019. While there were multiple meetings and communications, the conduct involved in giving effect to the two arrangements was effectively part of a single course of conduct.
It follows that, while it is appropriate to approach both offences on the basis that they are more objectively serious because they involve two contraventions and could have been charged as separate offences, that is not a particularly significant or weighty consideration. That is because the two contraventions involved in each offence in any event arose out of a single course of conduct.
Overall assessment of the seriousness of the offences
There could be little doubt that the offences committed by Bingo were very serious offences which warrant a condign sentence.
The offences involved conduct which resulted in the stifling and distortion of price competition in the substantial and relatively lucrative markets for waste collections services and processing services in Sydney or a significant part thereof. The anti-competitive behaviour persisted for a period of just over three months and only ceased because commercial pressures ultimately caused the participants to cheat on the arrangements. The offending conduct was deliberate, covert and was carried out by Bingo’s most senior executive officer in circumstances where there was little or no corporate culture of compliance in respect of competition law. Bingo was the instigator of the cartel arrangements and the largest provider of collections services and processing services in the relevant markets.
I am satisfied that, when all of the relevant facts, matters, and circumstances are weighed in the balance, it can safely be concluded that no sentence other than one involving imprisonment is appropriate in Mr Tartak’s case. While some of Mr Tartak’s subjective circumstances are undoubtedly mitigatory and compel a degree of leniency, the objective seriousness of his offences are such as to require a sentence of imprisonment.
The legislature has seen fit to provide a maximum penalty for cartel offences committed by an individual which includes imprisonment for up to ten years. That reflects how seriously the legislature views cartel offences. There could also be little doubt that the legislature chose to provide penalties which include imprisonment because the prospect of a sentence of imprisonment provides a real and powerful deterrent, not only for the offender in question, but also for would-be cartel offenders. The possibility, if not prospect, of imprisonment would no doubt make officers and employees of other corporations think twice before committing their corporations to cartel arrangements given the possibility, if not prospect, that they may be imprisoned if they do.
The cartel offences committed by Mr Tartak are also objectively very serious offences. Without wishing to unnecessarily repeat what also already been said, Mr Tartak, as the chief executive officer of a publicly owned and ASX listed corporation, caused that corporation to enter and give effect to an arrangement which included a cartel provision. That cartel provision concerned the prices that the two main competitors in the relevant market would charge for their services. In Bingo’s case, it would maintain certain specified price increases. There could be little doubt that the cartel provision had an impact on price competition in the relevant market with the result that there was a real chance that certain customers would pay more than they otherwise would have for the relevant services. The market in question – the market for collections services for building and demolition waste in Sydney – was a substantial and lucrative market.
It is true, as Mr Tartak pointed out, that the cartel arrangement only affected a geographically limited segment of the overall market for waste management services. It is equally true that the arrangement only persisted for a three-month period and that its impact – both in terms of the benefits derived and the harm caused – cannot be precisely identified or quantified. Those features of the cartel arrangement and the conduct generally must obviously be considered in assessing the overall seriousness of the offending conduct. The offences are undoubtedly less serious than they would have been if the cartel arrangements had a larger scope or persisted for longer. It does however not follow that the offences as committed were not very serious.
It is also necessary to have regard to the criminality involved in the two offences that Mr Tartak has requested the Court to have regard to pursuant to s 16BA of the Crimes Act. It is again unnecessary to rehearse what has already been said concerning those offences and the manner and means by which they may be taken into account in sentencing Mr Tartak. It suffices to note that the criminality involved in those offences was also serious, though to an extent they arose out of the same course of conduct that gave rise to the offences for which Mr Tartak is to be sentenced.
Of course, the seriousness of Mr Tartak’s offending must be weighed against his subjective circumstances. Those subjective circumstances were in many respects compelling. Again, without wishing to be repetitive, Mr Tartak was a man of prior good character, and a valued and well-respected member of the community. His fall from grace has been substantial and he has, and will continue to, suffer some extra-curial punishment. The offence was out of character. He is genuinely contrite and remorseful. That is reflected in his early plea of guilty and assistance to the relevant authorities. His early plea and assistance also had a utilitarian benefit. He has good prospects of rehabilitation and there is a low risk of him reoffending. Any sentence involving imprisonment will have a deleterious effect on his family.
As compelling as Mr Tartak’s subjective circumstances may be, I am not persuaded that they outweigh the objective seriousness of his offending such as to warrant or compel the conclusion that some penalty other than imprisonment would or may be appropriate. Rather, I am satisfied that the objective seriousness of Mr Tartak’s offending and the important deterrent effect of a sentence of imprisonment in the case of cartel offences compel the conclusion that no sentence other than imprisonment would be appropriate in Mr Tartak’s case. I am not satisfied that the imposition of a fine, even a large fine, would be a sentence of a severity appropriate in all the circumstances. Nor am I satisfied that any non-custodial sentence in Pt 2 Div 3 of the Sentencing Procedure Act that the Court could impose on Mr Tartak by virtue of s 20AB of the Crimes Act would be of a severity appropriate in all the circumstances.
The appropriate term of the sentence of imprisonment
The process of determining the length of the term of imprisonment that should be imposed on Mr Tartak in respect of the two offences again involves considering and weighing the relevant facts, matters, and circumstances and making a value judgment as to the sentence which would be of a severity appropriate in all the circumstances having regard to the established sentencing principles. It is again unnecessary to repeat what has already been said concerning the facts, matters, and circumstances relevant to the objective seriousness of the offences committed by Mr Tartak and Mr Tartak’s subjective circumstances. Having considered and weighed all those facts, matters, and circumstances, in my judgment the appropriate sentence of imprisonment to impose is as follows.
In respect of the offence under s 45AF(1) and s 79(1)(a) of the Competition and Consumer Act, the sentence that is of appropriate severity is a sentence of imprisonment for eighteen months. In arriving at that sentence, I have applied a discount of 40% for Mr Tartak’s early plea of guilty and assistance and cooperation with the authorities. But for that early plea and assistance, the appropriate sentence would have been two and a half years imprisonment.
In respect of the offence under s 45AG(1) and s 79(1)(a) of the Competition and Consumer Act, the sentence that is of appropriate severity is a sentence of imprisonment for eighteen months. In arriving at that sentence, I have again applied a discount of 40% for Mr Tartak’s early plea of guilty and assistance and cooperation with the authorities. But for that early plea and assistance, the appropriate sentence would have been two and a half years imprisonment.
Having regard to the principle of totality and the fact that there is there is a degree of overlap in the criminality involved in the two offences, it is appropriate to order that the sentences be served partly concurrently. It would in all the circumstances be appropriate for the sentence for the s 45AG(1) offence to commence six months after the commencement of the sentence for the s 45AF(1) offence, meaning that 12 months of the sentence will be served concurrently and there will only be an effective accumulation of six months. The effective sentence is accordingly a sentence of two years’ imprisonment.
In light of Mr Tartak’s submissions, it is next necessary to consider whether the Court should order his immediate release pursuant to a recognizance release order under s 20(1)(b) of the Crimes Act, or in the alternative whether it is appropriate to order that the sentence of imprisonment be served by way of an intensive corrections order.
As discussed later, I also propose to impose a fine on Mr Tartak.
Should the Court make a recognizance release order?
Section 19AC of the Crimes Act provides, in effect, that where a sentencing court imposes a sentence of imprisonment on a federal offender the term of which is between six months and three years, the court is required to make a recognizance release order in respect of that sentence unless “the court is satisfied that such an order is not appropriate having regard to … the nature and circumstances of the offence or offences concerned; and … the antecedents of the person”.
Section 20(1)(b)(i) of the Crimes Act relevantly provides that “[w]here a person is convicted of a federal offence or federal offences, the court before which he or she is convicted may, if it thinks fit … sentence the person to imprisonment in respect of the offence or each offence but direct, by order, that the person be released, upon giving security of the kind referred to in [s 20(1)(a)] … either immediately or after the person has served a specified period of imprisonment …”. In determining what recognizance release order should be made, the Court is required to take into account all of the relevant circumstances, including the matters in s 16A(2) of the Crimes Act, as well as the requirement in s 16A(1) that the sentence imposed must be of a severity appropriate in all the circumstances of the offence: see Hili v The Queen at [40]. In determining what period of imprisonment should be served, the sentencing court must have regard to the objective gravity of the offending and general deterrence: Director of Public Prosecutions (Cth) v Page [2006] VSCA 224 at [53]-[54]; CDPP v Vina Money Transfer at [198]; CDPP v Joyce at [187].
I do not consider that it would be appropriate to make an order under s 20(1)(b) of the Crimes Act directing that Mr Tartak be released immediately. That would not be a sentence of a severity appropriate in all the circumstances. Indeed, it would be far too lenient in all the circumstances. In arriving at that conclusion, I have had regard to all the facts, matters, and circumstances of the offences, including those that relate to the objective seriousness of the offences and those that relate to Mr Tartak’s subjective circumstances. In my view, the objective seriousness of the offences and the importance of general deterrence when sentencing for cartel offences makes immediate release under s 20(1)(b) of the Crimes Act inappropriate.
Is it appropriate for imprisonment to be served by way of an intensive correction order?
I am, however, satisfied that it would be appropriate to make an intensive correction order directing that the sentences of imprisonment be served by way of intensive correction in the community pursuant to s 7 of the Sentencing Procedure Act and s 20AB of the Crimes Act. Section 20AB(1AA)(a)(ix) specifically identifies an order that is known as an “intensive correction order” as being an additional sentencing alternative which is available under s 20AB(1).
A court cannot make, or consider making, an intensive correction order unless and until it has determined that no sentence other than imprisonment is appropriate and has determined the appropriate term of the sentence without regard to the manner in which the sentence will or should be served: Stanley v Director of Public Prosecutions (NSW) (2023) 97 ALJR 107; [2023] HCA 3 at [62]; Wany v Director of Public Prosecutions (NSW) (2020) 103 NSWLR 620; [2020] NSWCA 318 at [18]; R v Zamagias [2002] NSWCCA 17 at [26]. I have, for the reasons already given, determined that no sentence other than imprisonment is appropriate in Mr Tartak’s case and have determined the appropriate length or terms of that imprisonment. I have made those determinations without regard to the potential availability of an intensive correction order.
The sentencing procedure for intensive correction orders is set out in Pt 5 of the Sentencing Procedure Act. Those procedures are also relevantly picked up by s 20AB of the Crimes Act: Mourtada v The Queen [2021] NSWCCA 211 at [20]; CDPP v Joyce at [168].
Section 66(1) of the Sentencing Procedure Act provides that “community safety” is the paramount consideration when determining whether to make an intensive correction order and s 66(2) provides that when considering community safety, the court “is to assess whether making the order or serving the sentence by way of full-time detention is more likely to address the risk of reoffending”. That requirement “recognises that: community safety is not achieved by simply incarcerating an offender, but that incarceration may have the opposite effect; and the concept of community safety is linked with considerations of rehabilitation, which is more likely to occur with supervision and access to programs in the community”: CDPP v Joyce at [168] citing R v Pullen (2018) 87 MVR 47; [2018] NSWCCA 264 at [84]; see also Stanley at [83]-[88].
Section 67 of the Sentencing Procedure Act contains a list of offences and types of offences in respect of which an intensive correction order is not available as a sentencing option. The offences committed by Mr Tartak do not fall within that list. Section 68 provides that intensive correction orders are not available where the term of imprisonment exceeds certain specified durations. Those durations relevantly include, where two or more offences are committed, the duration of the term of imprisonment imposed for all the offences exceeds three years. The sentences of imprisonment that I have determined to be appropriate in Mr Tartak’s case do not exceed three years given the way they have been structured.
In considering whether it is appropriate to make an intensive correction order I have considered the contents of an assessment report in respect of Mr Tartak prepared by a community corrections officer of Corrective Services NSW: see s 17C and s 69 of the Sentencing Procedure Act. That report, among other things, assessed that there was a low risk of Mr Tartak reoffending and that Mr Tartak was suitable to undertake community service work. While the report does not specifically refer to the availability or suitability of an intensive correction order, it may nevertheless be inferred that it is a “relevant assessment report” for the purposes of s 17D(1) of the Sentencing Procedure Act. Even if that was not the case, I am nevertheless satisfied that there is sufficient information before the Court to justify the making of an intensive correction order without obtaining a relevant assessment report: see s 17D(1A) of the Sentencing Procedure Act.
My reasons for considering that it is appropriate to make an intensive correction order in Mr Tartak’s case may be briefly stated. In my view, community safety would be better served by Mr Tartak serving his sentences in the community subject to supervision and conditions. I am also of the view that an intensive correction order is more likely to address any risk of Mr Tartak reoffending rather than full-time detention. I consider that both the community and Mr Tartak would be better served by Mr Tartak serving his imprisonment by way of intensive correction in the community as opposed to full-time custody.
As discussed in detail earlier in these reasons, I am satisfied that there is a low risk of Mr Tartak reoffending and that Mr Tartak’s prospects of rehabilitation are good. Mr Tartak’s prospects of rehabilitation are in my view likely to be enhanced by the standard conditions of an intensive correction order, which are that the offender must not commit any offence and must submit to supervision by a community corrections officer.
I also consider that it is appropriate to impose an additional condition that Mr Tartak perform 400 hours of community service: see s 73A(2)(d) of the Sentencing Procedure Act. I note in that regard, that the assessment report indicates that Community Corrections can provide up to 21 hours of community service work per month. As noted earlier, the assessment report states that Mr Tartak has been assessed as suitable to undertake community service work: see s 73A(3) of the Sentencing Procedure Act. In my view, the requirement to perform community service work is likely to further enhance Mr Tartak’s prospects of rehabilitation. The requirement to submit to supervision and engage in community work is likely to cause Mr Tartak to pause and reflect on his wrongdoing in a way which is positive and likely to deter any future reoffending. I doubt that the same could be said if Mr Tartak is subject to full-time custody. I doubt that full-time custody would be more likely to positively address any risk that Mr Tartak might reoffend, particularly given the nature of Mr Tartak’s offending and his subjective circumstances.
I should reiterate that, while Mr Tartak submitted that the Court could not, or would not, be satisfied that no sentence other than imprisonment would be appropriate in all the circumstances of the case, he did not submit that, if the Court was so satisfied and imposed a term of imprisonment, it would not be open to the Court or appropriate to make an intensive corrections order. The Prosecutor also did not submit that the Court could not, or should not, make an intensive correction order and effectively conceded that the Court would not err if it made such an order.
I should also note in that context that, while issues and qualifications have been raised about the availability of intensive correction orders in the exercise of federal jurisdiction (see in particular Mourtada at [15]-[17]), neither party raised any such issues or qualifications. That may well have been because an intensive correction order was made by Abraham J in CDPP v Joyce. In any event, I have proceeded on the basis that there was no issue as to the availability of an intensive correction order in the circumstances of this case.
I do not consider that any other special conditions should be imposed under s 73A(2) of the Sentencing Procedure Act.
Given that I have determined that Mr Tartak’s imprisonment be served by way of an intensive correction order, I do not consider that it is appropriate to make a recognizance order under s 20(1)(b) of the Crimes Act directing that he be released after serving a specified term of imprisonment. As noted earlier, I have also determined that it would not be appropriate to order or direct that Mr Tartak be released immediately pursuant to a recognizance release order.
Imposition of a fine
As has already been noted, the maximum penalty for the offence committed by Mr Tartak is a term of imprisonment not exceeding 10 years, or a fine not exceeding $420,000, or both. In my view, Mr Tartak should be required to pay a fine in addition to the term of imprisonment to be served by way of intensive corrections order. That is appropriate and necessary to ensure that the overall sentence imposed on Mr Tartak is of a severity appropriate in all the circumstances.
Cartel offences are essentially economic crimes. Many economic crimes are motivated by greed, self-interest, and financial gain. While there is no direct evidence that Mr Tartak was motivated by his own financial gain, it may readily be inferred that he was motivated by Bingo’s economic interests and the indirect benefits he might thereby derive as Bingo’s chief executive officer. That perhaps might explain why he advised the community corrections officer who prepared the assessment report that his offence was “mainly committed for financial gain”. A fine is often an effective way of deterring economic crimes because it strikes at the heart of the motivation for the offending.
There was no evidence concerning Mr Tartak’s financial circumstances. As discussed earlier, while s 16C(1) of the Crimes Act requires the Court to take into account the financial circumstances of an offender before imposing a fine for a federal offence, s 16C(2) provides that the inability to determine an offender’s financial circumstances does not prevent the Court from imposing a fine. Moreover, Mr Tartak did not submit that he did not have the financial capacity to pay a fine and appeared to concede that the imposition of a fine would be within the Court’s sentencing discretion in all the circumstances.
I have determined, in all the circumstances, that it is appropriate to fine Mr Tartak $50,000 in respect of each of the offences, in addition to the sentences of imprisonment to be served by way of intensive correction orders. In determining the appropriate amount of the fine, I have taken into account and applied an appropriate discount to reflect Mr Tartak’s plea of guilty and assistance to the authorities. I have also had regard to the principle of totality.
I should finally note that I acknowledge that the sentence that I will impose on Mr Tartak is slightly more severe than the sentence I have decided to impose on Mr Roussakis. As discussed earlier in the context of the discussion concerning parity, the difference may be explained on the basis that: Mr Tartak is to be sentenced in respect of two offences, not one as was the case with Mr Roussakis; Mr Tartak asked the Court to take into account two additional offences pursuant to s 16BA of the Crimes Act, whereas Mr Roussakis only asked the Court to take into account one additional offence; the objective seriousness of the offending conduct in the two cases was different; and the offenders’ subjective circumstances were slightly different.
DISQUALIFICATION
The Prosecutor applied for an order pursuant to s 86E of the Competition and Consumer Act disqualifying Mr Tartak from managing a corporation for a period that the Court considers appropriate. Section 86E provides that the Court can make such an order if satisfied that the person against whom the order is sought has been involved in a contravention of Pt IV of the Act. Part IV of the Act includes the cartel offence provisions. I am, in those circumstances, satisfied that the Court can make a disqualification order against Mr Tartak. The only issue is whether the Court should exercise its discretion to make such an order.
That issue can be dealt with shortly, particularly because Mr Tartak did not oppose the making of a disqualification order. The primary purpose of a disqualification order is to protect the public, though it has also been said that disqualification orders can be imposed by way of deterrence and punishment: Australian Competition and Consumer Commission v Renegade Gas Pty Ltd (trading as Supagas NSW) [2014] FCA 1135 at [90]-[94]. The facts or circumstances that may be relevant to whether a disqualification order should be made include: the nature of the contraventions in question; the risks to the public if, in light of the contraventions, the defendant is permitted to manage a corporation; the interests of shareholders, creditors, and employees of any corporation managed by the defendant; the character of the defendant and his or her honesty and competence; and, any hardship to the defendant and their business interests that would follow from a disqualification order: see Renegade Gas at [95]-[96] citing Commissioner for Corporate Affairs (WA) v Ekamper (1987) 12 ACLR 519 at 525.
The facts and circumstances of this matter are such that it is appropriate for the Court to exercise its discretion in favour of making a disqualification order against Mr Tartak for a period of five years. There are sound reasons to conclude that a disqualification order is appropriate in order to protect the public from any risk that Mr Tartak may be involved in future contraventions if permitted to continue to manage corporations.
The offences committed by Mr Tartak were undoubtedly serious and involved a serious departure from the appropriate duties and standards that should be observed by managers of corporations, in particular chief executive officers of publicly listed companies. Mr Tartak unilaterally committed Bingo to unlawful anticompetitive arrangements in circumstances where, it may be inferred, he was aware of the unlawful nature of the arrangements and deliberately concealed them from Bingo’s board of directors. While I accept that Mr Tartak is contrite, the risks of him reoffending are low, and his prospects of rehabilitation are good, the nature of Mr Tartak’s offences are such that there is nevertheless a strong need to protect the public by ensuring that Mr Tartak is unable to occupy any management position for a period of time. That is a powerful consideration which weighs in favour of making a disqualification order.
Mr Tartak did not point to any consideration which weighed against the making of a disqualification order. He is no longer the chief executive officer of Bingo and there is no reason to believe that the shareholders, creditors, and employees of Bingo or its related companies would be worse off if a disqualification order was made against Mr Tartak. While I accept that a disqualification order may cause Mr Tartak some hardship in the future as it will make it more difficult for him to secure employment, the fact that he has committed these offences would in any event most likely make any prospective employer wary of placing Mr Tartak in a position of responsibility without supervision. I doubt that a disqualification order will add considerably to Mr Tartak’s difficulties in that regard. I also accept that the difficulties that Mr Tartak may encounter in securing employment in the future, including by reason of a disqualification order, may result in some hardship to his family. In my view, however, any hardship that may be suffered by Mr Tartak and his family as a result of a disqualification order is significantly outweighed by the need to protect the public.
While previous authorities have noted that a disqualification order may be imposed by way of deterrence and punishment, I doubt that it would be appropriate to make a disqualification order for either of those purposes. Punishment and deterrence are objectives or considerations that are highly relevant when determining the appropriate sentences to be imposed on an offender. In my view, however, the predominant, if not only, purpose of a disqualification order is the protection of the public. I do not propose to make the disqualification order for the purpose of punishing or deterring Mr Tartak. I do not consider that the disqualification order is part of the sentence imposed on him in respect of his offences. As previously indicated, however, in determining the appropriate sentences, I have taken into account that I would be making a disqualification order on the basis that it can be seen as a form of extra-curial punishment.
It should perhaps be noted in this context that the Prosecutor submitted that Mr Tartak would, in any event, be automatically disqualified from managing a corporation for five years pursuant to s 206B(1)(b) of the Corporations Act 2001 (Cth). The correctness of that submission would depend on whether the offences committed by Mr Tartak could accurately categorised as either offences concerning “the making, or participation in making, of decisions that affect the whole or a substantial part of the business of the corporation”, or offences concerning “an act that has the capacity to affect significantly the corporation’s financial standing” or as offences involving dishonesty: see s 206B(1)(a)(i) and (ii) and (b)(ii) of the Corporations Act. The offences committed by Mr Tartak, at first blush at least, would appear to fall into one or more of those categories. The Prosecutor nevertheless sought a disqualification order under s 86E of the Competition and Consumer Act to ensure that the ACCC was given notice of any application that Mr Tartak might make for leave to manage a corporation pursuant to s 206G of the Corporations Act.
I am satisfied that the disqualification of Mr Tartak from managing corporations is justified and that the appropriate period of disqualification is five years. I accordingly propose to make a disqualification order to that effect pursuant to s 86E of the Competition and Consumer Act.
CONCLUSION AND DISPOSITION
Convictions will be entered against Bingo and Mr Tartak in accordance with their pleas of guilty to the counts in the indictments presented against them.
The appropriate sentence to impose on Bingo in respect of each of the two offences it committed is a fine of $15,000,000, which results in an aggregate fine of $30,000,000. An order will be made to that effect.
The appropriate sentence to impose on Mr Tartak in respect of each of the two offences he committed is a sentence of imprisonment for 18 months, though those sentences are to be served partly concurrently so that the effective sentence of imprisonment is two years. That sentence is to be served by way of an intensive correction, the conditions of which include that Mr Tartak perform 400 hours of community service. Mr Tartak will also be fined $50,000 in respect of each offence, resulting in an aggregate fine of $100,000. Orders will be made to that effect.
Finally, it is appropriate to make an order under s 86E of the Competition and Consumer Act disqualifying Mr Tartak from managing corporations for a period of five years.
I certify that the preceding three hundred and six (306) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Wigney. Associate:
Dated: 23 February 2024
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