The Australian Competition and Consumer Commission (ACCC) has released its 2016 Compliance and Enforcement Policy. The Policy outlines the approach the ACCC will take to its compliance and enforcement functions and highlights a number of areas targeted for particular scrutiny from the regulator this year. The agriculture sector tops the list, as well as a continued focus on the health and medical sectors.
In this eBulletin, we outline the ACCC's key areas of focus for 2016.
- Agricultural section - new main focus
- Cartel conduct
- Other key trends for 2016
- Further information
Agricultural sector new-main focus
The agriculture sector will be a primary area of focus. In announcing the Policy, ACCC Chairman Rod Sims indicated an intention to follow up the Federal Government's Agriculture White Paper with specific market studies of the sector. Through these studies, the ACCC hopes to enhance its understanding of the competitiveness of particular agricultural supply chains.
In a clear signal of the priority it is giving this focus, the ACCC has established a specialist unit to undertake the work and has appointed Mick Keogh (formerly of the Australian Farm Institute and, previously, the National Rural Advisory Committee) as a Commissioner to lead the project.
There are a number of likely reasons for this new focus. The ACCC has been concerned with the grocery and fresh food markets for some time and it is a logical step to examine markets further up the supply chain. Further, the agriculture sector has experienced considerable growth over the last few years with opportunities for further growth and this has attracted large multinational agricultural companies to Australia's shores.
What this means is that the ACCC is likely to be taking a closer look at the activities of any agribusiness in Australia, in particular companies engaged in mergers or acquisitions in this sector.
Market conduct will also be closely scrutinised and we expect the ACCC will be ready to conduct formal investigations where it has reason to believe market power is being abused or other anticompetitive or unconscionable conduct has occurred.
Clients in this sector should ensure they are strictly compliant with the law and that adequate compliance training has been delivered to relevant staff.
As with 2015, medical service providers and private health insurers can expect the ACCC's interest in their sectors to continue. Adequate disclosures by providers - particularly in relation to out of pocket costs - is a key concern. Insurers will have to ensure that policy information is complete, clear and not at risk of misleading members. The ACCC will also continue to focus on misleading health claims in relation to food products.
The ACCC policy makes it clear that the ACCC will always focus on areas that it considers have the greatest potential for consumer harm, including anti-competitive agreements, cartel conduct, misuse of market power and product safety. Cartel conduct will remain a key a focus for the ACCC, with more than 12 cartel investigations under way as at the end of 2015.
Other key trends for 2016
Other key trends for this year include:
- continued focus on protecting consumers and small businesses;
- a greater focus on indigenous consumer protection; and
- a continued crackdown on large companies making representations in the area of express and extended warranties.
The 2016 Compliance and Enforcement Priorities policy provides insight into the areas that are likely to attract increased attention from the ACCC this year, such as the agriculture sector, and also confirms that the ACCC will continue to vigorously pursue, investigate and enforce breaches of the competition and consumer laws.