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Latest Australian Competition Law News and Commentary

New Year20 September 2017 - Judgment on Tabcorp merger: back to the Tribunal

The Full Federal Court (comprising Justice Besanko, Justice Perram and Justice Robertson) handed down its judgment on the appeals by ACCC and Crownbet against the decision of the Australian Competition Tribunal in relation to the Tatts/Tabcorp merger authorisation.

The appeal was successful and the Court has sent the matter back to the Australian Competition Tribunal for review. Reasons for judgment have been embargoed for the next five days.

See Scott Murdoch, 'Tabcorp merger with Tatts sent back to Australian Competition Tribunal' (The Australian, 20 September 2017) and Scott Murdoch, 'Tabcorp, Tatts merger hits hurdle' (The Australian, 20 September 2017). See also Nick Toscano, 'Tabcorp and Tatts merger derailed in Federal Court' (SMH, 20 September 2017).

The ACCC has issed a media release indicating it is 'pleased that the Full Federal Court has set aside the decision'.

See further

 

20 September 2017 - ACCC conducting local market screening re: BP's proposed acquisition of Woolworths' retail service station sites

The ACCC has published a Local market screening letter inviting submissions from interested parties by 28 September 2017.

The ACCC issued a Statement of Issues outlining preliminary competition concerns on 10 August 2017. The proposed day for the announcement of the ACCC's findings is 26 October 2017.

See ACCC merger register.

See also Sue Mitchell, 'BP, Woolworths fuel deal under spotlight' (AFR, 19 September 2017)

 

Image of electrical storm20 September 2017 - Sims's speech to National Press Club on energy affordability

ACCC Chairman, Rod Sims, address the National Press Club at lunchtime today on the issue of gas and electricity affordability.

The speech is now available:

 

Image of gaval20 September 2017 - Tabcorp listed for judgment in Federal Court today

The Federal Court Registry lists the ACCC and Crownbet appeals against the decision of the Austrlaian Competiton Tribunal for judgment at 2:15pm today.

The matter was heard by Justice Besanko, Justice Perram and Justice Robertson.

See further

 

Image of electrical storm20 September 2017 - Sims to address National Press Club on energy affordability today

ACCC Chairman, Rod Sims, will address the National Press Club at lunchtime today. His topic: 'Shining a light: Australia's gas and electricity affordability problem'.

For some media ahead of the speech, see:

 

20 September 2017 - ACCC wants four pillars bank policy reviewed

In a submission to the Productivity Commission's Inquiry into the Australian Financial System, the ACCC has suggested that the PC consider the impact of the four pillars policy on competition (para 3.2). The policy prevents mergers between the four major banks. The submission states, in part:

... the “four pillars” policy provides clarity and certainty that any mergers between the large banks would not be permitted. In that sense, the policy reflects a decision by the government to prevent further consolidation in an otherwise concentrated market rather than leaving this decision potentially with the Court, should a merger be challenged on competition grounds.

Conversely, it could be argued that the policy insulates the large banks from competition. Arguably the effect of the “four pillars” policy in addition to the implicit guarantee and prudential measures entrenches the large banks’ strong position in relevant markets and reinforces their “too big to fail” status. Whether this limits the ability of new entrants and smaller banks to constrain the large banks is a question we consider warrants further consideration. ...

The ACCC indicates it has not formed a final view on the issue. Its submission sets out in more detail the divergent views about the policy. The submission also sets out a number of initiatives the ACCC considers may reduce barriers to competition in retail banking, including reducing restrictions on the use of the term 'bank'.

See further:

 

Image of time - rushing14 September 2017 - Looks like October for the Harper Bill

The Competition and Consumer Amendment (Competition Policy Review ) Bill 2017 (Harper Bill) was back on the Senate Red today, but further lengthy debate on Broadcasting Legislation Amendment (Broadcasting Reform) Bill 2017 (which eventually passed around 4:30pm) means the Senate is not likely to get to it today (update: it didn't make it ... October it is).

The Senate does not sit again until mid-October.

See, eg, John Durie, 'Parliamentary delay keeps competition reform at bay' (The Australian, 14 September 2017).

 

Image of generic power station14 September 2017 - Sims: AGL's ownership of Liddell and Bayswater anticompetitive

In an interview with the Australian Financial Review, ACCC Chairman, Rod Sims, described AGL's ownership of the Liddell and Bayswater powerplants as anticompetitive.

Sims points to the ACCC's opposition to AGL's deal to buy MacGen from the NSW government, which was approved by the Australian Competition Tribunal in 2014 after the ACCC refuse to grant informal clearance. Sims told the AFR that the ACCC thinks the merger 'is having an effect on increasing power prices right now'.

See Angela Macdonald-Smith, 'AGL Energy's Liddell ownership 'anti-competitive': Sims' (AFR, 13 September 2017)

See also 'ACCC sys AGL behaviour 'anti-competitive' (Sky News, 14 September 2017) (includes video)

 

14 September 2017 - ACCC to investigate Google and Facebook

Image of facebookImage of Google Chrome

As part of a deal to get media laws through the Senate, Treasurer Scott Morrison has agreed to have the ACCC conduct an inquiry into Google and Facebook (and other internet giants).

This follows Senator Xenophon (whose vote was crucial to the Govt) expressing concerns that Google and Facebook were 'hoovering up' billions in advertising revenue.

See,e g, Bevan Shield and Lucy Battersby, 'Media reforms to pass the Senate, clearing the way for major mergers and acquisitions' (SMH, 14 September 2017), Kylar Loussikian and Sharri Markson, 'Media Reforms: Senate Inks Deals on Critical Media Shake-Up' (Daily Telegraph, 14 September 2017), AAP, 'Media reforms set to pass Senate' (SkyNews, 14 September 2017), Darren Davidson, 'Fifield close to media reform breakthrough with crossbench' (The Australian, 11 September 2017).

See also Stephanie Dalzell, 'Media laws package to pass after Xenophon deal' (ABC Radio, AM with Sabra Lane, 14 September 2017).

 

14 September 2017 - Harper Bill listed again in today's Senate Red

The Competition and Consumer Amendment (Competition Policy Review ) Bill 2017 (Harper Bill) was listed in the Senate yesterday, but lengthy debate on the Marriage Law Survey (Additional Safeguards) Bill 2017 and Broadcasting Legislation Amendment (Broadcasting Reform) Bill 2017 prevented the Senate reaching the Harper Bill before adjourning.

The Bill is back on the Red today. Broadcasting Reform bill still up first, but debate not expected to last long this morning. It's possible that may be followed by introduction of the Higher Education Support Legislation Amendment (A More Sustainable, Responsive and Transparent Higher Education System) Bill 2017. Then follows second reading debate on the Australian Border Force Amendment (Protected Information) Bill 2017 before the Harper Bill. If it doesn't make it today we'll have to wait until the next sitting in mid-October.

 

Image of phone data app13 September 2017 - Sims: Fuel price data can benefit motorists and retailers

ACCC Chair, Rod Sims, has delivered a speech at the Asia Pacific Fuel Industry Forum, outlining how 'fuel price data from websites and apps empower price-sensitive customers'.

The speech sets out the ACCC's role and activity in petrol, including quarterly reporting, market studies in regional markets, investigating of shopper dockets and merger review. Sims also discusses the ACCC's investigation into Informed Sources and the resulting undertaking that Informed Sources makes the same fuel price information it provides to subscribers available to consumers (which has happened since May 2016). Sims then goes on to discuss international evidence around the benefits of petrol price transparency and the recent increase in availability of price information to customers in Australia.

See ACCC media release.

View speech.

 

Image of court bench8 September 2017 - Inquiry into Competition and Consumer Amendment (Abolition of Limited Merits Review) Bill 2017 now accepting submissions

The Senate yesterday referred the Competition and Consumer Amendment (Abolition of Limited Merits Review) Bill 2017 to the Environment and Communications Legislation Committee for report by 16 October 2017.

The Committee is now accepting submissions until 19 September 2017.

See my inquiry page for further details.

 

7 September 2017 - ACCC launches first business to business unfair contracts term case

The ACCC has instituted proceedings against waste management company, JJ Richardss & Sons Pty Ltd, alleging eight clauses in its standard form small business contract are void because they are 'unfair' under the Australian Consumer Law. See ACCC media release for details.

The unfair terms law has applied to consumer transactions for a number of years, but only extended to small business contracts in November 2016. See also ACCC report discussing unfair terms in small business contracts, published 10 November 2016.

See also Cara Waters, 'ACCC launches first small business unfair contracts court action' (SMH, 7 September 2017), Stephen Letts, 'ACCC accuses JJ Richards over rubbish contracts with small businesses' (ABC, 7 September 2017), Michael Roddon, 'ACCC sues waste firm for unfair contracts' (The Australian, 8 September 2017), John Durie, 'Test case for new small business contracts law' (The Australian, 7 September 2017).

 

Image of powerlines7 September 2017 - Competition and Consumer Amendment (Abolition of Limited Merits Review) Bill 2017 off to Committee

The Selection of Bills Committee External linkreported (report 10 of 2017) in the Senate today that it was unable to reach agreement about whether to refer the Competition and Consumer Amendment (Abolition of Limited Merits Review) Bill 2017 to Committee.

Senator Gallagher then moved that the bill be referred to the Environment and Communications Legislation Committee for report by 16 October 2017. The Senate divided. The motion to adopt the report was agreed to as amendmed by Senator Gallagher (Ayes 33, Noes 24).

 

7 September 2017 - Senate debate on competition reform bills

Three competition bills were before the Senate yesterday.

The Competition and Consumer Amendment (Abolition of Limited Merits Review) Bill 2017, while listed (after being introduced Tuesday afternoon), was not debated yesterday; it is scheduled for resumption of debate today.

The Competition and Consumer Amendment (Competition Policy Review ) Bill 2017 was introduced and read for the first time. Second reading speeches commenced, with Senator Ruston's reading speech incorporated in Hansard (in substantially the same form as the Treasurer's second reading speech in the House earlier this year). Debate was adjourned.

Finally, the External linkLegislation Committee's Report on the External linkTelecommunications Legislation Amendment (Competition and Consumer) Bill 2017 was tabled by Senator Fawcett. Two related bills were considered as part of this inquiry. They relate to regulatory arrangements for the NBN and follow the Vertigan Panel report. The Committee recommended some amendment to the related bill, but otherwise recommended passage of both bills.

 

6 September 2017 - Competition reform bills in the Senate

Two competition reforms bills passed the House yesterday.

The first, the Competition and Consumer Amendment (Abolition of Limited Merits Review) Bill 2017 is listed for second reading debate this morning.

The second, the Competition and Consumer Amendment (Competition Policy Review ) Bill 2017 - is simply noted on today's order of business as a bill for concurrence.

 

5 September 2017 - Competition and Consumer Amendment (Competition Policy) Bill passes House

The main Harper Bill - the Competition and Consumer Amendment (Competition Policy Review ) Bill 2017 - passed the House late this afternoon.

The bill contains many of the changes to the law proposed by the Harper panel, including changes relating to cartels, price signally and concerted practices, third line forcing, resale price maintenance, authorisations, notifications and class exemptions, among other things. It also proposes to increase penalties for secondary boycott conduct (to align with the existing penalties for other Part IV breaches), a move strongly opposed by the Labor party (Labor has indicated it supports the remaining amendments).

The introduction of the effects test for misuse of market power was passed into law late last month via separate legislation (Competition and Consumer Amendment (Misuse of Market Power) Act 2017 (Act 87 of 2017)), but the key provisions won't come into operation unless and until the main Harper Bill is passed.

See my bill page for further details and links to second reading speeches etc.

 

Hot topics

Competition Policy Review (Harper)

Harper Review

Read moreThe first major review of competition policy in Australia was conducted in 2014-2015 with the final report released on 31 March 2015. The Government has accepted many of the recommendations. A reform bill designed to implement these recommendations was introduced into the House on 30 March 2017 and passed the House on 5 September 2017; a separate MMP bill has passed both houses.

 

Misuse of market power

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Read moreAlways topical, the issue of misuse of market power featured prominently in the Harper Review, with the Panel recommending introduction of an effects test. In March 2016 the Government announced that it would introduce an effects test; a bill was introduced on 1 December 2016 and has now passed both houses. It will not come into force unless and until the main Harper Bill comes into operation.

First criminal cartel case

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Read moreOn 14 July 2016 the Commonwealth Director of public prosecutions filed an indictment against Nippon Yusen Kabushiki Kaisha in the Federal Court of Australia. NYK pleaded guilty to criminal cartel conduct on 18 July 2016 and on 3 August 2017 was convicted and fined $25m. This was the first criminal cartel conviction under Australia's (relatively) new cartel laws.

 

Market in Australia

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Read moreIn June 2017 the High Court unanimously dismissed appeals from Air NZ and PT Garuda Indonesia relating to the air cargo cartel; the focus of the appeal was on whether the parties' conduct occurred in a 'market in Australia', as was then required in relation to price fixing. The High Court unanimously held that there was a market in Australia.

Another merger authorisation

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Read moreOn 22 June 2017 the Tribunal handed down its decision in Tabcorp's merger authorisation application; the merger was approved. This represents the third successful application for merger authorsation to the Tribunal since it became first instance decision maker in merger authorisation claims in 2007; there have been no unsuccessful applications. The ACCC and CrownBet successfully applied for judicial review of the Tribunal's decision (Judgment 20 Sept 2017); the matter will now return to the Tribunal.

 

Cartels and agency arrangements

TPA cover

Read moreThe 2013 arguably inconsistent outcomes in the ANZ and Flight Centre cases in 2013 led to some uncertainty about the circumstances in which agents may be considered in competition with their principals for purposes of the cartel laws. The appeal decisions in both cases were handed down on 31 July 2015. The ACCC successfully appealed the Flight Centre decision to the High Court (decision of 14 December 2016)

 

Images copyright: Images in the Hot Topic section (left column): male runner on starting blocks courtesy of stockimages at FreeDigitalPhotos.net; gas pump filling nozzles courtesy of Rawich at FreeDigitalPhotos.net and price magnifier definition means promotions and savings courtesy of Stuart Miles at FreeDigitalPhotos.net.(right column): business man and stock graph report courtesy of watcharakun at FreeDigitalPhotos.net; vacations computer key courtesy of Stuart Miles (Image ID: 10091676) at FreeDigitalPhotos.net; handshaking courtesy of Photokanok at FreeDigitalPhotos.net,

 

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