Australian Competition and Consumer Commission
Encyclopedia
The Australian Competition and Consumer Commission (ACCC) is an independent authority of the Australia government. It was established in 1995 with the amalgamation of the Australian Trade Practices Commission
(TPC) and the Prices Surveillance Authority to administer the Trade Practices Act 1974
(TPA) (Cth). Its mandate is to protect consumer rights, business rights and obligations, perform industry regulation and price monitoring and prevent illegal anti-competitive behaviour.
to enforce its provision. The Trade Practices Act contains a broad range of provisions, such as provisions on [price fixing] cartels, misuse of market power, and misleading or deceptive conduct
. The ACCC also reviews mergers. The ACCC, under the Act, also regulates certain industries by providing access to national infrastructure. The ACCC also has an educative role and seeks to educate both consumers and businesses as to their rights and responsibilities under the act.
The Australian Energy Regulator
is a constituent but separate part of the ACCC and is responsible for economic energy regulation. It shares staff and premises with the ACCC, but has a separate board, although at least one board member must also be a Commissioner at the ACCC.
Companies that do not comply with the restrictive trade practices provisions of the Trade Practices Act may be fined by the Federal Court. There are three ways the maximum fine can be calculated. The maximum possible fine is the larger of A$10,000,000; or three times the value of the illegal benefit; or (if the value of the benefit cannot be ascertained) 10% of turnover for the preceding 12 months. Individuals may be fined up to $500,000
Companies that do not comply with the consumer protection provisions of the Trade Practices Act may be fined by the Federal Court, up to $1.1 M for companies and $220,000 for individuals.
The ACCC also has power to accept, on its on behalf, court enforceable undertakings under s87B of the Trade Practices Act. Such undertakings may include a wide range of remedies to the conduct.
A range of other remedies can be ordered by the court. For example, companies are frequently forced to publish retractions of false advertising claims in national newspapers and at their places of business. Companies found in breach of the Trade Practices Act are usually bound to implement a compliance program to ensure future compliance with the act.
Although the penalties permitted by the Trade Practices Act are quite severe, there has been a reluctance by the courts to impose the maximum penalty. There has been a move recently to make certain offences under competition law (such as price fixing or participation in a cartel) into criminal offences rather than purely civil breaches. It is generally thought that the possibility of being found guilty of a criminal offence—and the possibility of a custodial sentence for executives involved—will provide a much stronger deterrent to anti-competitive behaviour.
Recently the ACCC has exercised its authority in a number of retail areas, including fining retailer Target
for false advertising and Woolworths
(including some Safeway
branded supermarkets in Victoria, Australia) for anti-competitive liquor deals. In 2008 the ACCC published findings of its inquiry into the competitiveness of retail prices for groceries in Australia. The report found that the Australian supermarket sector is "workably competitive", but price competition is limited by barriers to entry and a lack of incentive for the two major players, Coles
and Woolworths
, to compete on price. The report also noted that Coles and Woolworths engage in deliberate strategies designed to ensure they maintain exclusive access to prime sites such as shopping centres to prevent centre managers leasing space to competing supermarkets. In September 2009 the ACCC reached agreement with Coles and Woolworths to phase out restrictive lease agreements. The ACCC has enforced the law against producers of quack devices with medical claims like Power Balance
.
s and the following organisations are commissioned to assist with the surveillance and monitoring of product safety in relevant areas.
The ACCC, in conjunction with state and territory offices of fair trading, is responsible for developing and enforcing mandatory consumer product safety standards except where the product falls into the jurisdiction of one of the specialist regulators mentioned above.
General:
Australian Trade Practices Commission
The Australian Trade Practices Commission was the agency responsible for monitoring and enforcement activities under the Trade Practices Act 1974. It was replaced by the Australian Competition and Consumer Commission in 1995....
(TPC) and the Prices Surveillance Authority to administer the Trade Practices Act 1974
Trade Practices Act 1974
The Competition and Consumer Act 2010 is an act of the Parliament of Australia. On 1 January 2011 the Trade Practices Act 1974 was renamed the Competition and Consumer Act 2010. The act provides for protection of consumers and prevents some restrictive trade practices of companies. It is the key...
(TPA) (Cth). Its mandate is to protect consumer rights, business rights and obligations, perform industry regulation and price monitoring and prevent illegal anti-competitive behaviour.
Roles
The ACCC administers the Trade Practices Act, and has standing to take action in the Federal Court of AustraliaFederal Court of Australia
The Federal Court of Australia is an Australian superior court of record which has jurisdiction to deal with most civil disputes governed by federal law , along with some summary criminal matters. Cases are heard at first instance by single Judges...
to enforce its provision. The Trade Practices Act contains a broad range of provisions, such as provisions on [price fixing] cartels, misuse of market power, and misleading or deceptive conduct
Misleading or deceptive conduct
Misleading or deceptive conduct is a doctrine of Australian law.Section 18 of the Australian Consumer Law , which is found in schedule 2 of the Competition and Consumer Act 2010 prohibits conduct by corporations in trade or commerce which is misleading or deceptive or is likely to...
. The ACCC also reviews mergers. The ACCC, under the Act, also regulates certain industries by providing access to national infrastructure. The ACCC also has an educative role and seeks to educate both consumers and businesses as to their rights and responsibilities under the act.
The Australian Energy Regulator
Australian Energy Regulator
The Australian Energy Regulator is the regulator of the wholesale electricity and gas markets in Australia. It is part of the Australian Competition and Consumer Commission and enforces the rules established by the Australian Energy Market Commission....
is a constituent but separate part of the ACCC and is responsible for economic energy regulation. It shares staff and premises with the ACCC, but has a separate board, although at least one board member must also be a Commissioner at the ACCC.
Restrictive trade practices
In most cases the spirit of the act, and thus the actions of the ACCC, favours neither consumer nor supplier, but strives to achieve a competitive market without artificial restrictions. For example, refusal of supply – a producer refusing to supply a potential retailer or customer with a product – is not itself illegal unless the action would have an anti-competitive effect on the market as a whole.Penalties
The ACCC is committed in bringing court actions against companies that breach the Trade Practices Act. Penalties for non-compliance of the TPA can be quite severe.Companies that do not comply with the restrictive trade practices provisions of the Trade Practices Act may be fined by the Federal Court. There are three ways the maximum fine can be calculated. The maximum possible fine is the larger of A$10,000,000; or three times the value of the illegal benefit; or (if the value of the benefit cannot be ascertained) 10% of turnover for the preceding 12 months. Individuals may be fined up to $500,000
Companies that do not comply with the consumer protection provisions of the Trade Practices Act may be fined by the Federal Court, up to $1.1 M for companies and $220,000 for individuals.
The ACCC also has power to accept, on its on behalf, court enforceable undertakings under s87B of the Trade Practices Act. Such undertakings may include a wide range of remedies to the conduct.
A range of other remedies can be ordered by the court. For example, companies are frequently forced to publish retractions of false advertising claims in national newspapers and at their places of business. Companies found in breach of the Trade Practices Act are usually bound to implement a compliance program to ensure future compliance with the act.
Although the penalties permitted by the Trade Practices Act are quite severe, there has been a reluctance by the courts to impose the maximum penalty. There has been a move recently to make certain offences under competition law (such as price fixing or participation in a cartel) into criminal offences rather than purely civil breaches. It is generally thought that the possibility of being found guilty of a criminal offence—and the possibility of a custodial sentence for executives involved—will provide a much stronger deterrent to anti-competitive behaviour.
Consumer confidence
The ACCC is regarded by some Australian business people as necessary but often ineffective, echoing the critics of American anti-trust laws, while Australian consumers generally hold the ACCC in high regard. Whilst it is acknowledged that the ACCC is required to help safeguard consumer rights, there has been occasional criticism of the organisation as being "all-talk-no-action". This criticism is most likely due to the inherent difficulty in obtaining sufficient evidence to prove breaches of the restrictive trade practices provisions of the Trade Practices Act.Recently the ACCC has exercised its authority in a number of retail areas, including fining retailer Target
Target (Australia)
Target Australia Pty Ltd is an Australian department store chain owned by Wesfarmers . It operates 172 Target stores and 119 Target Country stores making 291 combined stores with its head office located in North Geelong, Victoria. It sells clothing, cosmetics, toys, homewares, electrical and...
for false advertising and Woolworths
Woolworths Limited
Woolworths Limited is a major Australian company with extensive retail interest throughout Australia and New Zealand. It is the:* largest retail company in Australia and New Zealand by market capitalisation and sales...
(including some Safeway
Safeway (Australia)
Safeway was the trading name used by Woolworths Limited until 2008 for its supermarkets in Victoria, Australia. Elsewhere in Australia the trading name is Woolworths. In August 2008, Woolworths announced the discontinuation of the Safeway name, and has since gradually rebranded Victorian stores as...
branded supermarkets in Victoria, Australia) for anti-competitive liquor deals. In 2008 the ACCC published findings of its inquiry into the competitiveness of retail prices for groceries in Australia. The report found that the Australian supermarket sector is "workably competitive", but price competition is limited by barriers to entry and a lack of incentive for the two major players, Coles
Coles Supermarkets
Coles Supermarkets is an Australian supermarket chain owned by Wesfarmers. It has 741 stores nationally Coles Supermarkets is an Australian supermarket chain owned by Wesfarmers. It has 741 stores nationally Coles Supermarkets is an Australian supermarket chain owned by Wesfarmers. It has 741...
and Woolworths
Woolworths Limited
Woolworths Limited is a major Australian company with extensive retail interest throughout Australia and New Zealand. It is the:* largest retail company in Australia and New Zealand by market capitalisation and sales...
, to compete on price. The report also noted that Coles and Woolworths engage in deliberate strategies designed to ensure they maintain exclusive access to prime sites such as shopping centres to prevent centre managers leasing space to competing supermarkets. In September 2009 the ACCC reached agreement with Coles and Woolworths to phase out restrictive lease agreements. The ACCC has enforced the law against producers of quack devices with medical claims like Power Balance
Power Balance
Power Balance is a brand of hologram bracelet once claimed by its manufacturers and vendors to "use holographic technology" to "resonate with and respond to the natural energy field of the body", and increase sporting ability...
.
Product safety and recalls
The ACCC maintains a website listing all Australian product recallProduct recall
A product recall is a request to return to the maker a batch or an entire production run of a product, usually due to the discovery of safety issues. The recall is an effort to limit liability for corporate negligence and to improve or avoid damage to publicity...
s and the following organisations are commissioned to assist with the surveillance and monitoring of product safety in relevant areas.
- Food products – Food Standards Australia New ZealandFood Standards Australia New ZealandFood Standards Australia New Zealand is the governmental body responsible for developing food standards for Australia and New Zealand .FSANZ develops food standards after consulting with other government agencies and stakeholders...
- Motor vehicles Department of Infrastructure, Transport, Regional Development and Local Government (Australia)
- Therapeutic goods – Therapeutic Goods AdministrationTherapeutic Goods AdministrationThe Therapeutic Goods Administration is the regulatory body for therapeutic goods in Australia . It is a Division of the Australian Department of Health and Ageing established under the Therapeutic Goods Act 1989 ...
- Agricultural and veterinary products – Australian Pesticides and Veterinary Medicines Authority
- Electrical goods – Australian Electrical Equipment Safety Regulators
- Gas and appliance – Gas Technical Regulators Committee Australia New Zealand
The ACCC, in conjunction with state and territory offices of fair trading, is responsible for developing and enforcing mandatory consumer product safety standards except where the product falls into the jurisdiction of one of the specialist regulators mentioned above.
Chairpersons
- Allan FelsAllan FelsProfessor Allan Fels is an Australian economist, lawyer and public servant. He was most widely known in his role as chairman of the Australian Competition and Consumer Commission from its inception in 1995 until 30 June 2003...
1 July 1995 – 30 June 2003 - Graeme SamuelGraeme SamuelGraeme Julian Samuel AC is an Australian businessman. He is currently works as chairman of the Melbourne office of investment bank Greenhill Caliburn, and is a member of the Australian National University Council...
1 July 2003 – 31 July 2011 - Rod SimsRod SimsRod Sims is the current Chairman of the Australian Competition and Consumer Commission effective August 2011. He is also the Chairman of the Independent Pricing and Regulatory Tribunal of New South Wales. He has previously worked as a development economist in Papua New Guinea as well as for the...
1 August 2011
See also
- Economy of AustraliaEconomy of AustraliaThe economy of Australia is a developed, modern market economy with a GDP of approximately US$1.23 trillion. In 2011, it was the 13th largest national economy by nominal GDP and the 17th largest measured by PPP adjusted GDP, representing about 1.7% of the World economy. Australia was also ranked...
- Australian Consumers' Association
- List of Australian Commonwealth Government entities
- Two-price advertising (in Australia)
General:
- Competition lawCompetition lawCompetition law, known in the United States as antitrust law, is law that promotes or maintains market competition by regulating anti-competitive conduct by companies....
- Competition policy
- Competition regulatorCompetition regulatorA competition regulator is a government agency, typically a statutory authority, sometimes called an economic regulator, which regulates and enforces competition laws, and may sometimes also enforce consumer protection laws...
- Consumer protectionConsumer protectionConsumer protection laws designed to ensure fair trade competition and the free flow of truthful information in the marketplace. The laws are designed to prevent businesses that engage in fraud or specified unfair practices from gaining an advantage over competitors and may provide additional...
External links
- Official ACCC website
- Official AER website
- Product Safety Australia website (maintained by ACCC)
- Recalls website (maintained by ACCC)