There have been a number of important developments in competition/antitrust law in Australia over the previous 12 months.
Firstly, the much anticipated changes to competition laws proposed by the Harper Panel are likely to become law in 2017. The key changes include the introduction of:
- an“effects” test to the misuse of market power prohibition – despite widespread commentary that this change will have significant ramifications on decisions made by big business, we believe that the “effects” test will only result in increased rigour around decisions of competitive significance by those businesses without having a material impact on those decisions; and
- a “concerted practices” prohibition where such conduct has the purpose or effect of substantially lessening competition. This new prohibition is likely to catch conduct which previously fell short of Australian competition law but it remains to be seen whether the law will operate in a manner that is consistent with international jurisdictions.
Secondly, the Australian Competition and Consumer Commission (ACCC) has continued its vigorous enforcement of international and domestic cartel conduct with the Commonwealth Director of Public Prosecutions commencing the first ever cases for criminal cartel conduct (seven years after the laws came into effect). The ACCC has explicitly stated that it anticipates investigating 1-2 criminal cartel cases every year going forward.
Thirdly, the ACCC continues to take a robust approach to the enforcement of the Australian Consumer Law by all businesses – big, medium, small and both domestic and international companies. In addition to the many cases brought by the ACCC (for misleading claims, unconscionable conduct and product safety issues), a new unfair terms regime commenced in November 2016 which prohibits unfair terms in standard form small business contracts.
Fourthly, the ACCC has become very vocal in raising its concerns about the monopoly pricing conduct of successful bidders following the acquisition of essential government facilities such as utilities. While the ACCC has in the past considered that privatisation results in more efficient operation of infrastructure, it is concerned that high sale prices for assets are being recouped through monopoly pricing practices to the ultimate detriment of Australian consumers.
Finally, in August 2016 the Chairman of the ACCC, Rod Sims was reappointed for a further three years. In light of the ACCC’s successes over the previous 12 months, we anticipate that the ACCC will (with the increased confidence brought by a second Sims’ term), continue its vigorous investigation and enforcement of competition and consumer laws in Australia for many years to come.