On 21 February 2013 the Chairman of the ACCC Rod Sims outlined the ACCC’s priorities for 2013.

Background

By way of general background, Mr Sims outlined that the ACCC:

  • ‡ ‡would continue with its policy of “strong enforcement”, noting that with strong enforcement comes the ability to effect change of behaviour of companies
  • ‡ ‡would also continue to be proactive, seeking to address “main problem areas”
  • ‡ ‡needs to get “big and usually very public decisions right” in the context of authorisation, merger, enforcement and regulatory decisions
  • ‡ ‡needs to be “practical” and engage with industry and parties
  • ‡ ‡recognises the role of competition and the importance of regulating monopolies
  • ‡ ‡needs to explain what they are and are not doing, and why.#

It is evident that over the last 12 months the ACCC has been successful on several fronts. It has instigated and had a number of proceedings resolved in its favour. The ACCC has been increasingly prominent with its achievements and obtained considerable media coverage. Likewise it has undertaken a number of educative initiatives, including with respect to consumer guarantees and its ACCC Shopper App, its Knock, Knock, Who’s There door to door campaign amongst others. In the area of competition law, the ACCC has been considerably successful with respect to cartel conduct in the airline freight sector, with significant penalties imposed by the Federal Court on a number of airlines.

Mr Sims has highlighted the priority areas for the ACCC in 2013.

Competition

The ACCC will continue to focus on cartel conduct, anti-competitive agreements and misuse of market power. Some specific areas of focus are highly concentrated sectors, which includes supermarkets and fuel sectors.

Further emphasis has also been placed on online competition and consumer issues, including conduct impeding emerging online competition or limiting the ability of small business to effectively compete online.

Mergers and Acquisitions

The ACCC will continue to pay close attention in areas where mergers raise serious competition concerns and especially in large complex transactions and mergers in concentrated markets.

Particular focus will be had by the ACCC of mergers in the supermarket, liquor and hardware sectors. Further, electricity generation is also another sector which currently undergoing considerable activity with long term implications.

At the same time, the ACCC recognises that it needs to be effective, transparent and responsive to the needs of business when administering its statutory processes. To this end, it is currently revising the Informal Merger Process Guidelines and will continue to work and be communicative with businesses during the merger review process, allowing submissions to address issues prior to the public consultation stage - the statement

of issues process (SOI). Likewise after receiving responses during the SOI process, the ACCC recognises the need to work cooperatively with parties to address any remaining concerns.

Regulation: Part IIIA

The ACCC awaits the Productivity Commission’s report relating to the National Access Regime.

Regulation: National Broadband Network (NBN)

Having received submissions, the ACCC is currently formulating its position with respect to the Special Access Undertaking that will apply to the NBN. NBN Co proposes that the Undertaking to apply until 2040 and as such, the ACCC is proceeding accordingly, with regard to the long term interests of end users (LTIE). The ACCC proposes to have a draft decision by March 2013.

Regulation: Electricity

More resources have been dedicated to the Australian Electricity Regulator (AER). Of particular focus is the need to have the interests of consumers “better represented in regulatory decision making”. There is also a proposal to develop a national consumer advocacy body to “provide a consumer voice for energy policy and regulatory development”.

Regulation: Wheat code

This sector is currently undergoing legislative and regulatory changes, in particular with respect to access to wheat ports.

Consumer Problems

Given the introduction of the Australian Consumer Law over two years ago, it has become apparent to the ACCC that particular areas require focus.

Online consumer issues

In addition to emerging competition mentioned above, the ACCC is continuing to look closely at online group buying websites. It is also interested in “fake testimonials” and reviews in an online retail context, given the increased trend of online shopping.

Telecommunications and energy

Of particular concern to the ACCC has been the conduct of some energy retailers towards consumers, with respect to door to door sales. It will therefore continue with its education campaign including handing out “Do Not Knock” stickers.

continue to be vigilant with respect to representations made regarding goods and services with respect to tech products and IP services. The ACCC has been particularly successful in this space over the last couple of years.

Consumer guarantees

Education of consumers and businesses alike with respect to consumer guarantees will be an issue for the next 12 months.

It appears the ACCC will continue initiating actions for alleged misrepresentation of consumer guarantees provisions of the Australian Consumer Law.

Consumer protection issues impacting on Indigenous communities

The ACCC recognises the need to empower indigenous communities and instill a sense of confidence in dealings with business. Telephone plans in out of coverage areas and misrepresentations about the authenticity, nature and characteristics of art will continue to be areas where enforcement action will be taken.

Credence claims, particularly in the food industry

It is apparent that consumers place importance on representations where, in many instances, such representations cannot be readily verified. In such cases, a consumer is reliant or dependent on the supplier, manufacturer or producer on the provision of accurate information.

Unfair contract terms

With respect to the new unfair contract terms provisions that were introduced along with the Australian Consumer Law in late 2010 and 2011, the ACCC will soon release a report in relation to clauses of concern, particularly in telecommunications sector, airline sector, hire car industry and with respect to online trading.

Mr Sims has indicated that the ACCC has spent a lot of time in the past year working with businesses to ensure they are not infringing unfair contract terms, and now it will be shifting its emphasis to prosecuting those who have not taken heed.

Carbon pricing

The ACCC will continue to consider unjustifiable price increases attributed to the “carbon tax”.

Small business

There will be a continued focus on the ACCC on anti-competitive conduct and unconscionable conduct impacting on small businesses. This extends to the exploitation of small businesses by other businesses with a superior bargaining position, including in the context of supermarkets and suppliers, and also within the online sector.

Given a perceived imbalance of bargaining power by small businesses generally, the ACCC will “continue to facilitate collective bargaining by suppliers, including primary producers”.

An industry working group is also proposing to establish a supermarket code to apply to supply chain issues. The ACCC is of the view that such a code should be given the force of the Competition and Consumer Act and feature meaningful enforceable provisions.

There is also a review currently being undertaken with respect to the Franchising Code of Conduct. Consideration is being had as to whether certain penalties should apply to contraventions in order to act as a deterrent. Further, the ACCC is reviewing the range of remedies available for contraventions and potentially increasing and expanding options available, including pecuniary penalties, against franchisors who have failed to comply with their obligations.