Competition Law Review and the Role of the ACCC
Thursday 31 October 2013 @ 9.26 a.m. | Trade & Commerce
Speaking to 150 food and grocery industry representatives at an Australian Food and Grocery Council forum in Canberra yesterday (30 October 2013), new Federal Minister for Small Business, Bruce Billson said he expected the terms of reference for a further competition review would be released before the end of the year.
Currently in progress, there is an independent review of the operation of Division 16 of Part XIB of the Competition and Consumer Act 2010 (Cth), as required by section 151DD of that Act. Division 16 provides authorisation for certain NBN Co conduct that is reasonably necessary to achieve uniform national wholesale pricing. The review is scheduled to report in October 2013.
Mr Billson cautioned against attacks on the competition watchdog, the Australian Competition and Consumer Commission (ACCC) for a perceived lack of teeth in pursuing alleged anti-competitive behaviour, saying the ACCC was using the tools at its disposal, which are provided by Parliament. Mr Billson also said that a review of Australian competition law is vital to make sure those tools, the existing laws, are fit for their purpose.
These statements come after the supermarkets have come under fire from farmers and smaller retailers, who allege Coles and Woolworths are abusing their market power and screwing down prices, in contravention of competition laws. The supermarkets refute those claims, and say lower grocery prices are unequivocally a good thing for consumers.
Mr Billson said:
"In some respects, Section 46 [of the Competition and Consumer Act 2010] is a hunting dog that won't leave the porch. It looks great, it may growl, but it rarely bites...Some of the alleged behaviour by supermarkets may not necessarily breach the competition laws as they are today. But at the same time, that doesn't mean that the status quo is necessarily delivering the most efficient or optimal outcomes for the market, our economy and our consumers."
Meanwhile, the ACCC Chairman, Rod Sims, provided a regulator's perspective on the debate and said they should be able to release the findings of their investigation into alleged anti-competitive behaviour by the supermarkets by the end of March 2014.
“At the ACCC, we are completely clear that our role is only to protect the competitive process, and this is how we see the current debate. It is simply incorrect to label all those who question aspects of the degree of market power of the major supermarket chains as people wanting to protect inefficient businesses. Second, we see the supermarket issues capable of being dealt with under the Competition and Consumer Act, and we do not see use of the Act as excessive regulation...Indeed, effective implementation of the Act is vital for the success of our market economy. It provides clear and wide boundaries within which we can all benefit from the power of the profit motive."
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