01 Mar 2012

ACCC sets out its five priorities for 2012

by Michael Corrigan

The ACCC has given fair warning that it will use its new powers under the Australian Consumer Law, and scrutinise particular sectors and behaviours.

Telcos, fuel, energy, supermarkets and online businesses have particular reason to ensure compliance with competition and consumer laws this year – the ACCC will be paying particular attention to you.

ACCC Chairman Rod Simms outlined the regulator's priorities for 2012 last week, and launched its updated Compliance and Enforcement Policy.

Its priorities fall under five main headings:

Using the new ACL powers

The changes in Australian Consumer Law , described by Mr Sims as "profound", offer more regulatory options to the ACCC, which is keen to explore them in conjunction with the State and Territory agencies.

A main focus this year will be misleading and deceptive conduct, especially in:

  • the telecommunications sector: fresh from its win against TPG over its bundled telco services, the ACCC will continue to work on greater transparency for consumers;
  • the energy industry: Chairman Sims cites representations on savings, and services to find the best available prices, as having the potential to mislead consumers;
  • carbon pricing: the ACCC will be particularly vigilant for claims incorrectly attributing a price increase to the carbon price.

Maintain or enhance competition in concentrated markets

Fuel and supermarkets will be under the ACCC microscope this year. Chairman Sims says:

"The ACCC has not yet formed the view that there are breaches of the Act occurring; but our priority in 2012 will be to determine whether or not there are breaches in these important sectors."

Other priorities will be:

  • unconscionable conduct between businesses;
  • online business: lower barriers to entry make it easier for new entrants to take on established players, so misuse of market power will be a key concern;
  • cartel education and enforcement: "The available evidence suggests that many business people are not aware that price fixing, market sharing, bid rigging, agreeing restrictions on supply or output constitutes cartel activity. Unfortunately it may be that the ACCC needs to take enforcement action, including criminal prosecutions, to get the message across."
  • mergers: the ACCC will be making commercial assessments and not relying on abstract theory.

Invigorate the debate on the effective regulation of monopolies

The regulatory underpinnings of the future operation of the NBN will be determined this year. In addition, there will be discussion on the future shape of regulation of Australia's major airports and electricity networks.

One topic that the ACCC says needs discussion is the regime for access to infrastructure in Part IIIA, "particularly how relevant they are to greenfield investment such as new railways in the Galilee basin and, say, new inter-modal transport facilities in our capital cities."

Particular focus on vulnerable consumers

Elderly and Indigenous consumers can be particularly vulnerable, and the ACCC will put more emphasis on them this year.

ACCC’s international engagement

This has two aspects: international co-operation between regulators to deal with multi-jurisdictional issues, and helping developing countries in the region establish and maintain their competition agencies.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.