A federal government package of measures aimed at promoting competition and cracking down on anti-competitive behaviour by powerful businesses was announced today.
To defend small business from predatory pricing and give it a permanent voice, the Australian Competition and Consumer Commission (ACCC) will attempt to ensure genuine competition for the benefit of consumers and small businesses by:
1) Cracking down on anti-competitive behaviour by powerful businesses with new rules to make it easier to prosecute businesses engaging in anti-competitive behaviour.
The Government’s amendments will:
- ensure that victims of predatory pricing will not need to prove that the predator has the ability to recoup losses after participating in an anticompetitive below cost pricing strategy
- clarify the meaning of the term ‘take advantage’ in section 46 in response to concerns raised by businesses and the ACCC that the present meaning of that term has prevented section 46 from capturing anticompetitive behaviour
- remove the unnecessary uncertainty that has arisen following the ‘two track’ process for predatory pricing that developed under the previous government. The ACCC has said that the dual track process has “caused considerable confusion” because they focus on the “fundamentally different concepts” of market power and market share
“The uncertainty surrounding the operation of the provision [Birdsville amendment] has the potential to dampen legitimate competitive behaviour.”
The reforms will also strengthen the role of the ACCC by enabling it to fully investigate suspected breaches of the law by enhancing its information gathering powers. The Government will also extend the reach of the ACCC by removing the arbitrary monetary threshold currently applicable to allegations of unconscionable conduct, enhancing the protection of small business from transactions involving such things as undue influence.
These amendments will deal with predatory pricing while allowing businesses to engage in genuine competition and discounting to the benefit of consumers.
2) Giving small business prominent and permanent representation on the ACCC
Small business will now have a permanent voice in the ACCC, with a requirement for at least one ACCC Deputy Chairperson to have small business expertise.
Giving small business a permanent voice within the ACCC will improve understanding of the special circumstances confronting small businesses and the difficulties they face in dealing with anti-competitive behaviour by more powerful businesses.
3) Giving small business cheaper and more efficient judicial access
Small and medium business to save significant costs by allowing cases involving a misuse of market power to be heard in the Federal Magistrates Court rather than in the Federal Court, in appropriate circumstances.
The Assistant Treasurer will write to the States and Territories seeking their approval for the proposed amendments.
For more info contact:
James Cullen (Minister Bowen) – 0409 719 879
Chris Ward (Minister Emerson) – 0418 424 654
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