07 March 2022
The Australian Competition and Consumer Commission (ACCC) has signalled a focus on competition and consumer issues arising from the COVID-19 pandemic, including disruptions to global and domestic supply chains, consumer environmental claims and sustainability, and manipulative or deceptive advertising in the digital economy, in its 2022-23 Compliance and Enforcement Policy and Priorities.
In his recent annual address, outgoing ACCC Chair, Mr Rod Sims, announced the regulator’s enforcement priorities for the year ahead and highlighted the existing and emerging issues and their potential impact on consumer welfare and the competitive process. Mr Sims said the ACCC’s role was to make markets work for consumers, now and in the future, by maintaining and promoting competition, fixing market failure, and protecting consumers’ interests and safety in support of a fair marketplace. By identifying and communicating the ACCC’s focus areas, he believes behaviour change can be achieved.
This year, the ACCC’s priorities have been aligned to the financial year for the first time. However, the regulator vowed to give them immediate focus. Businesses and stakeholders are therefore encouraged to take note of the types of conduct and the industries in which the ACCC will concentrate their resources going forward.
Despite recent setbacks in their competition enforcement program, with the NSW Ports decision not going their way and the Commonwealth Department of Public Prosecutions recently dropping criminal charges in the banking cartel cases, the ACCC remains resolved to pursue action on critical competition issues. This includes the following new priorities for the coming year.
Global and domestic supply chains
COVID-related staff shortages, port congestion and transport interruptions have disrupted global and domestic supply chains resulting in higher freight rates and higher prices for consumers. To deal with these issues, the ACCC recently joined global efforts to prevent anti-competitive conduct through a working group with the US Department of Justice and Federal Bureau of Investigation, Canadian Competition Bureau, NZ Commerce Commission, and UK Competition and Markets Authority.
In light of the pandemic-induced disruptions, the five competition authorities will focus on illegal conduct, including collusion, in global supply chains. Businesses that fix prices or share markets in 2022-23 are on notice for enforcement action.
Exclusive supply or acquisition arrangements by firms with market power that impact competition will also face close examination this financial year. The ACCC noted instances of large and powerful Australian firms engaging in exclusionary behaviour that impacted competition, particularly firms with market power restricting access to bottleneck goods or services and limiting competitors or new entrants.
With several investigations regarding this priority area already underway, including against Peters ice cream, the ACCC vowed to undertake further enquiries to identify and address this conduct of concern.
Financial services sector
The ACCC will continue to focus on competition issues in the financial services sector, particularly payment services. With Australian consumers increasingly using payment cards when buying goods or services, the regulator believes competition in the market is vital. The ACCC also identified a number of issues regarding competition in relation to mobile digital wallet services, such as Apple Pay, and signalled its intention to investigate.
Agriculture and franchising
In the agriculture sector, the ACCC highlighted the importance of ensuring compliance with industry codes of conduct, including in dairy and horticulture. Several enforcement actions have been taken under these codes recently (see for example the action taken for breaches of the Dairy Code) and will be subject to further scrutiny this year.
Enduring competition law priorities
The ACCC also announced that it has continued enduring priorities in the competition law enforcement space, including:
In his recent speech, Mr Sims noted that the ACCC will always prioritise the enforcement of these key provisions of the Competition and Consumer Act 2010 (Cth).
Mr Sims also raised two areas of potential legislative reform to address the concerns that ACCC has with the effectiveness of the current enforcement regime.
In his speech, Mr Sims again voiced his concerns about the adequacy of the merger control regime in Australia, particularly its ability to ensure relevant transactions are subject to the appropriate level of scrutiny to prevent anti-competitive mergers. With Australia experiencing a significant surge in merger and acquisition activity, Mr Sims believes reform is needed to better ensure that merger control in Australia is fit for purpose and in line with international best practices. It is ultimately a matter for the government to determine what the next steps are, but discussions on these issues will remain a priority for the ACCC this year.
The ACCC has also recently released a discussion paper of proposed legislative reform to address concerns about the dominance of digital platforms and the ability of enforcement action to address the systemic competition and consumer concerns identified in the digital platform markets inquiry.
In his speech, Mr Sims confirmed that the outcomes from this discussion paper would be the subject of a report by the ACCC to the Commonwealth Treasurer in September this year.
The ACCC has identified a number of consumer and fair trading priorities for compliance and enforcement action in 2022-23.
COVID-19 has continued to disrupt many businesses and consumers, leading to cancellations and difficulties in obtaining refunds. After receiving a number of consumer complaints in the initial stages of the pandemic, the ACCC worked with companies to facilitate refunds and improve communication practices.
With new and ongoing challenges stemming from the pandemic, particularly as a result of travel credits and the supply of rapid antigen tests, the ACCC said it would focus on adapting and reacting with speed as new issues arise.
Environmental claims and sustainability
The ACCC also acknowledged growing community concerns that some businesses are misappropriating environmental or green credentials in their promotions to capitalise on consumer preferences.
The regulator vowed to crackdown on this form of ‘greenwashing’. Unfortunately, many consumers are unable to determine the legitimacy of these claims, while businesses employing genuinely environmentally friendly manufacturing processes face unfair competition from those who don’t. The ACCC flagged collaborative work with other regulators, particularly ASIC and the Clean Energy Regulator, and will take action where businesses have engaged in false, misleading or deceptive conduct.
The ACCC raised concerns about the growing number of manipulative online tactics to exploit or pressure consumers towards certain products rather than those matching their search terms.
After recent successes against Trivago for its misleading manipulation of search results and against Google for misleading consumers about its collection of personal data, the ACCC intends to maintain this momentum through its current proceedings against Facebook for allegedly misleading consumers as to the use of their personal data.
The ACCC has carried over its priority compliance and enforcement action regarding the pricing and selling of essential services from last year.
With numerous cases undertaken against telecommunication and energy companies for making false and misleading representations, enforcement action in this sector is likely to continue apace across 2022-23.
Motor vehicles and caravans
The motor vehicle and caravan sector experienced significant growth due to COVID and international travel restrictions. The ACCC will continue to focus on consumer guarantee obligations this financial year.
Enduring consumer law priorities
In addition to the above priorities, the ACCC has reiterated the following consumer “enduring” priorities:
The 2022-23 priorities and Mr Sims’ valuable insights are relevant for public sector entities, private businesses and consumers to understand their legal rights and obligations. They are particularly useful when businesses are keen to ensure they are doing the right thing.
It is important for public sector entities and private businesses to be familiar with these compliance and enforcement priorities, and know where to seek help.
Our team can assist you in understanding your legal rights and obligations, staying up to date with any impending changes to the law, or providing advice that may address emerging issues by:
If you would like to get in touch, please contact us or send us your enquiries here.
Author: Joanne Jary & Kayla Plunkett
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 article is accurate at the date it is received or that it will continue to be accurate in the future.