ACCC Investigation into the Barnawartha Boycott
Thursday 28 January 2016 @ 10.38 a.m. | Trade & Commerce
Following investigation into the alleged Barnawartha boycott, the Australian Competition and Consumer Commission (ACCC) identified some competition concerns but not any breach of Australian consumer laws. The investigation, which was finalised and reported on 9 December 2015, revealed that the evidence obtained by the ACCC did not demonstrate that the nine concerned meat processors reached an agreement to not attend the sale at Barnawartha.
Background
Allegations were brought against nine meat processors suggesting that they had collectively boycotted the prime cattle sale. Leading up to the sale there had been disputes over whether the livestock should be weighed before or after the sale. Producers and the Victorian farm lobby called for the investigation suggesting that the buyers had colluded to boycott the sale. A subsequent Senate inquiry revealed that the saleyard operators knew for months that at least one processor had planned a boycott.
ACCC Investigation
The ACCC launched an extensive investigation into the alleged boycott to establish whether the nine processors had breached the Australian Consumer Law. To establish the breach, evidence needed to demonstrate that there was an agreement as well as a commitment by at least one of the processors not to attend the sale.
Evidence demonstrated that the processors had communicated about the sale and that concerns were expressed regarding the nature of the weighing process. However, the evidence did not go further than this. It was not established that any sort of arrangement was entered or reached to boycott the sales. ACCC Chairman Rod Sims said:
"There is a fine line between social discussions about industry issues on the one hand, and exchanging information in circumstances that may constitute an understanding between competitors on the other…Competitors talking about whether they will buy goods or services is a high-risk activity which may breach competition laws."
However, a breach was not demonstrated in this instance despite there being ‘uncertainty’ ahead of the sale.
The ACCC has recently formed an Agricultural Enforcement and Engagement Unit. As one of its priorities in 2016, the Unit will focus on reviewing practices in the red meat industry that raise competition or fair trading concerns.
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