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What's News in Competition & Consumer Law? – 2 October 2018

02 October 2018

#Competition & Consumer Law

What's News in Competition & Consumer Law? – 2 October 2018

In the media

A new rule will give customers time to switch power companies before planned price increases
Electricity and gas customers will receive at least five days notice of price increases so they can consider switching to other providers, under changes to national energy rules. The rule change builds on measures already introduced to crack down on price gouging by energy retailers (27 September 2018).  More...

Leading Australian hearing clinic pays penalties for misleading customers
Australian Hearing Services has paid penalties totalling $37,800 after the ACCC issued three infringement notices alleging the Australian Government owned corporation engaged in false or misleading conduct in connection with the supply of hearing services to consumers (28 September 2018).  More...

Fear for independent service stations as thousands sign up for nationwide fuel station boycott amid spike in petrol prices
More than 50,000 social media users have signed up to boycott service and fuel stations across the country on 26 October 2018 to protest high fuel prices. CommSec economist Ryan Felsman attributed the price increases to the global price of crude oil, which has risen to above $80 a barrel, but also to what he describes as evidence of ‘price gouging’ behaviour among local retailers (26 September 2018).  More...

Fitness First pays penalty for excessive surcharging
Fitness First Australia Pty Ltd has paid a penalty of $12,600 after the ACCC issued an infringement notice for an alleged breach of the excessive payment surcharge provisions of the Competition and Consumer Act 2010. ACCC Deputy Chair Mick Keogh said “Businesses charging excessive payment surcharges, intentionally or not, do so at the risk of breaching the Competition and Consumer Act (26 September 2018).  More...

ACCC commences market study into wine grape industry
The wine grape industry will be the focus of a new ACCC market study. The study will examine competition, contracting practices, transparency, and risk allocation issues in the wine grape supply chain (25 September 2018).  More... 

Australian regulator cracks down on misleading digital coin offerings
Australia’s corporate watchdog said it was stepping up scrutiny on “misleading” initial coin offerings (ICOs) targeted at retail investors while adding it has already acted against several such proposals (20 September 2018).  More...

AAMI could have been fined $7m over dodgy ads, got away with paying just $43k
The banking royal commission hears Suncorp's AAMI made a "commercial assessment" to settle a potential $7.2 million ASIC legal claim over misleading advertising for just $43,200, despite maintaining there was nothing wrong with the ads (20 September 2018).  More...

Full Court upholds appeal by Unique College
The Full Federal Court has upheld an appeal by Unique International College Pty Ltd (Unique) and dismissed a cross appeal by the ACCC and the Commonwealth (on behalf of the Department of Education and Training). The Full Court found that Unique did not engage in a system of unconscionable conduct regarding the enrolments of vulnerable consumers into diploma courses (19 September 2018).  More...

Processors warned not to mislead dairy farmers about milk prices
The ACCC has warned dairy processors not to mislead farmers about milk prices, following reports of processors blaming their private-label milk contracts with supermarkets for the low prices offered to farmers. A key finding of the ACCC’s Dairy Inquiry was that almost all contracts for the supply of private label milk allow processors to pass-through movements in farm gate prices to supermarkets (18 September 2018).  More...  More...

ASIC sues Terry McMaster and Dover for their deceptive 'client protection' policy
The corporate regulator has sued scandal-plagued Dover Financial Advisers and its director, Terry McMaster, for engaging in misleading and deceptive conduct (17 September 2018).  More...

Effective airport regulation needed
Given that some of the second-tier airports such as Adelaide and Canberra potentially hold significant market power, the current inquiry provides an opportunity for the Productivity Commission to consider whether other major airports should be subject to similar types of regulatory oversight as the four monitored airports. The ACCC has also been formally directed by the Australian Government to monitor prices, costs, profits and quality of service of both aeronautical and car parking activities (17 September 2018).  More...

Telcos put on notice over 'unlimited data' mobile deals
Telcos are being warned they face fines of millions of dollars for misleading advertising promoting 'unlimited data' mobile plans. Australia's consumer watchdog, the ACCC, issued the warning, saying penalties for contraventions increased on 1 September to the greater of $10 million, three times the value of the benefit received, or where the benefit cannot be calculated, 10 per cent of the annual turnover in the preceding 12 months (17 September 2018).  More...  More...

In practice and courts

ACCC submission to the Productivity Commission's Inquiry into the economic regulation of airports
On 17 September 2018, the ACCC provided a submission to the Productivity Commission in response to the issues paper in relation to its inquiry into the economic regulation of airports.  More...

Wine grapes – a market study by the ACCC: issues paper
Australian Competition and Consumer Commission: 26 September 2018
This issues paper will assist interested parties in making submissions to the ACCC’s wine grape market study. The paper outlines the issues that the ACCC plans to explore during the market study, based on our previous consultation with the industry, issues raised during various inquiries, and the results of the recent grower survey.  More...

Retail and wholesale petrol market shares in Australia
Australian Competition and Consumer Commission: 25 September 2018
The ACCC produces quarterly petrol monitoring reports focusing on price movements in the capital cities and over 190 regional locations across Australia. It also produces industry reports that focus on particular aspects of consumer interest in the fuel market.  More...

Prescription for poverty: drug companies as tax dodgers, price gougers, and influence peddlers
Mark Fried; Oxfam International: 18 September 2018
Pharmaceutical companies behind some of Australia’s best-known brands avoided an estimated $215 million a year in tax in Australia over a three year period - almost four times the $63 million actually paid, according to this report.  More...

Cases

Australian Competition and Consumer Commission v Cornerstone Investment Aust Pty Ltd (in liq) (No 4) [2018] FCA 1408
CONSUMER LAW – Alleged contraventions of ss 18 and 29 of the Australian Consumer Law – misleading or deceptive conduct in trade or commerce – false or misleading representations about goods or services – where respondent provided online vocational education services, engaging recruiters to market its services direct to consumers – whether recruiters made misleading or deceptive representations to specific consumers, including by silence – various representations that respondent’s courses and laptops given as inducements to enrol were free, or that no liability was incurred until a consumer’s income exceeded a threshold, or that respondent’s courses were specifically for Aboriginals in contravention of ss 18 and 29 – attribution of recruiters’ conduct to respondent.
CONSUMER LAW – Alleged contraventions of ss 74, 76, 78 and 79 of the Australian Consumer Law – whether respondent, and respondent by its recruiters, contravened unsolicited consumer agreement provisions regarding specific consumers – disclosing purpose and identity – requirement to leave premises upon request – requirement to inform consumer of termination period – requirement to give documentation of agreement to consumer – contraventions found.
CONSUMER LAW – Alleged contraventions of s 21 of the Australian Consumer Law – unconscionable conduct in trade or commerce in connection with supply of goods or services – whether respondent’s marketing and enrolment system unconscionable – marketing and enrolment system unconscionable where insufficient training given to recruiters, consumers induced to enrol, unsolicited consumer agreements made without safeguards, minimal verification of consumers’ literacy and numeracy, and targeted at disadvantaged consumers – whether recruiters acted unconscionably regarding specific consumers – recruiters acted unconscionably where they variously contravened ss 18 and 29 and the unsolicited consumer agreement provisions, manipulated or pressured consumers to enrol and assist in the enrolment of others within their communities, forged documents, enrolled consumers in multiple courses, and/or failed to assess consumers’ suitability to enrol – attribution of recruiters’ conduct to respondent.
Australian Consumer Law (contained in Sch 2 to the Competition and Consumer Act 2010 (Cth)) ss 18, 21, 22, 29, 69, 70, 74, 75, 76, 78, 79, 82

Turner v MyBudget Pty Limited [2018] FCA 1407
CONTRACT – Proper construction of interest provision in consumer contract – whether it authorises respondent to take and use interest earned on client funds for its own purposes – whether breach of trust or breach of fiduciary duty – held contract authorises respondent’s actions and no breach.
CONSUMER LAW – Australian Consumer Law s 24(1) – meaning of an unfair term – relevant considerations – whether a term is unfair if it authorised respondent to take and use interest earned on client funds for its own purposes – discussion of matters relevant to establish an unfair term including meaning of a “significant imbalance in the parties’ rights and obligations arising under the contract” – held no unfair term.
REPRESENTATIVE PROCEEDING – Orders made under s 33ZB of Federal Court of Australia Act 1976 (Cth) binding group members who have not opted out.

Unique International College Pty Ltd v Australian Competition and Consumer Commission [2018] FCAFC 155
CONSUMER LAW – Alleged contraventions of s 21 of the Australian Consumer Law – provision of online vocational educational courses covered by the VET FEE-HELP scheme – whether appellant engaged in unconscionable system of conduct or pattern of behaviour – unconscionability as a characterisation related to human conduct by reference to conscience – conscience as reflected in the statute – insufficient evidence to found conclusion of an unconscionable system or pattern of behaviour.
Australian Securities and Investments Commission Act 2001 (Cth), s 12CB
Competition and Consumer Act 2010 (Cth) sch 2, Australian Consumer Law, ss 21, 22
Evidence Act 1995 (Cth), ss 97, 98, 140; Trade Practices Act 1974 (Cth); Competition and Consumer Regulations 2010 (Cth), reg 81(1)(c)

Contacts:
Melbourne

Howard Rapke, Managing Partner, Melbourne
T: +61 3 9321 9752
E: howard.rapke@holdingredlich.com

Sydney
Ian Robertson, National Managing Partner
T: +61 2 8083 0401
E: ian.robertson@holdingredlich.com

Brisbane
Paul Venus, Managing Partner, Queensland
T: +71 7 3135 0613
E: paul.venus@holdingredlich.com

Disclaimer
The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this publication is accurate at the date it is received or that it will continue to be accurate in the future. We are not responsible for the information of any source to which a link is provided or reference is made and exclude all liability in connection with use of these sources.

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