On 26 March 2018, the Organisation for Economic Co-operation and Development (OECD) released its report “Pecuniary Penalties for Competition Law Infringements in Australia”. The report compares Australia's pecuniary sanctions regime for competition law infringements to that of a number of other major OECD jurisdictions.
The report indicates that the amount of pecuniary penalties imposed for competition law infringements in Australia is significantly lower, in both absolute and relative terms, than the amounts imposed in other OECD jurisdictions, particularly as regards large companies or conduct that lasted for a long period of time. For example, for penalties imposed in Australia in a number of cartel cases up to November 2017, the average pecuniary penalty in Australia was AUD 25.4 million, while the average base penalty in the comparator jurisdictions would have been AUD 320.4 million.
The Report recommends that Australian authorities consider actions to ensure that pecuniary penalties better deter anticompetitive conduct, such as:
- increasing awareness of and taking into account international practices in the determination of pecuniary penalties;
- linking the amount of the penalty to the economic impact of the sanctioned company’s conduct and the seriousness and duration of the infringement, and decoupling it from the sanction amounts imposed for similar anticompetitive conduct in the past; and
- studying whether to develop and adopt a structured method for the calculation of the amount of pecuniary penalties – including, potentially, the identification of a base pecuniary penalty.
In a speech on the report also given on 26 March 2018, ACCC Chairman Rod Sims:
- noted that the ACCC will re-think its approach to assessing penalties that it puts to the Courts, in particular how to take into account the size and revenue of the contravening firm, both in determining the penalty amount considered appropriate in the circumstances and in its submissions; and
- flagged the possibility of public ACCC guidance materials on penalties.