Steel & Tube Holdings, along with two other companies, will be prosecuted by the Commerce Commission following the regulator's investigation into seismic steel mesh, while Fletcher Building's steel division has been given a warning.
The commission didn't name the companies in its statement this morning, giving them the opportunity to seek name suppression, and is still investigating several other companies, it said. Steel & Tube said in a statement to the NZX that it was "disappointed" to learn the commission intends to prosecute, and said its mesh had been externally tested since April and it was confident in it.
The investigation started in August 2015 after a complaint was laid about the steel mesh, which is used in housing and driveway construction, not meeting the standards required in New Zealand. This year the commission ordered Euro Corp and Brilliance Steel to stop selling their steel mesh products. The stops placed on Euro Corp and Brilliance Steel have been lifted.
Timber King, based in Mt Wellington, was also under investigation as of April, after testing indicated 500E grade steel mesh it sold mightn't comply with the standard.
The commission said it will allege the companies misrepresented that their mesh complied with the standard, when it did not, and aims to file criminal charges under the Fair Trading Act in early 2017, but as its investigations are ongoing it won't comment further.