Australia reviews its Immunity Policy for Cartel Conduct in Consumer Law

Thursday 20 June 2013 @ 12.17 p.m. | Trade & Commerce

The Australian Competition and Consumer Commission (ACCC) is currently undertaking a review of its immunity policy for whistleblowers, in light of the experience gained since Australia criminalised its cartel laws in July 2009.

The review will focus on:

  • The joint roles of the Director of Public Prosecution and the ACCC;

  • The carve-out for ringleaders; and

  • Waiver letters

Current Cartel Laws

There has been a direct prohibition on cartel conduct through Part IV of the Australian Consumer Law (contained in Schedule 2 of the Competition and Consumer Act 2010 (Cth)). This includes price fixing, bid rigging, market division and restricting outputs in Australia.

Cartel conduct is defined as a "contract, arrangement or understanding" and two or more of the parties involved are competitors (or would be but for the conduct). The criminal and civil prohibitions are the same save for an additional fault element of 'knowledge or belief' in relation to the criminal offence.

Some examples of cartel conduct include:

  • Visy and Amcor packaging cartel - 2000 - 2004

  • Power Transformers Cartel - 1994 - 1999

  • Marine Hose Cartel - 2010

  • Viscas Corporation - 2013

Current ACCC Policy on Immunity

The ACCC's immunity policy has been central to its efforts to detect and prosecute cartel conduct, which is often highly lucrative and therefore problematic also to deter, even in the face of the toughest sanctions.

Under Australia's concurrent civil and criminal procedure, only the DPP can grant immunity for a criminal prosecution, while the ACCC retains the power to grant immunity in respect of civil liability.

Under the policy the first eligible cartel member to blow the whistle receives full immunity from legal proceedings and penalties, irrespective of the party’s culpability or the harmfulness of its conduct.

Since its immunity policy was launched in 2005, the Commission has received about 110 marker applications and currently is actively pursuing between 20 and 30 investigations, not all of which include cartel allegations.

Australia has yet to see a prosecution initiated under the new criminal cartel legislation.

Questions have been raised in the current review aimed at the effectiveness of:

  • Protection against coercion

  • Interaction between DPP and ACCC regarding criminal immunity

  • The effectiveness of immunity

It will be interesting to see the results of the review when released.

Sources:

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