5 September 2016
Media Release - #2016091, 2016

Release of Exposure Draft for Consultation: Strengthening Australia’s Competition Law

Today the Turnbull Government has released Exposure Draft legislation to strengthen Australia’s competition law and improve the long-term welfare of consumers, businesses and the economy.

The draft legislation contains changes to the Competition and Consumer Act 2010 (the Act) as recommended by the Harper Review, and includes a significant reform to the misuse of market power provision (section 46).

The Harper Review found that Australia’s current misuse of market power law is not reliably enforceable and does not effectively target and deter anti competitive conduct. This uncertainty and inefficiency creates a barrier to the entry and expansion of new and innovative firms, delays the development of new technologies in Australia and hinders productivity growth in the long term.

The Government’s decision to adopt the Harper Review recommendation to reframe section 46 means Australia will have a commercially and legally robust law, preventing firms with substantial market power engaging in conduct that harms the competitive process.

This package contains a number of other important changes to the Act, designed to simplify the law and better deal with anti competitive conduct while supporting pro competitive behaviour, including:

  • broadening the definition of ‘competition’ to include potential imports of goods and services, to fully reflect the range of competitive pressures facing Australian firms;
  • confining the cartel conduct provisions to conduct affecting competition in Australia and broadening the exceptions for joint ventures and vertical trading restrictions to apply to common, pro competitive business arrangements;
  • amending the National Access Regime declaration criteria, including to ensure third-party access is only mandated where it is in the public interest;
  • consolidating the various authorisation processes into a single, streamlined process; and
  • simplifying the Act by repealing separate, specific prohibitions on price signalling and exclusionary provisions, and introducing a prohibition against concerted practices.

The ACCC has released frameworks for guidelines on its proposed approaches to the enforcement of the amended section 46 and in relation to the prohibition against anti competitive concerted practices. The frameworks provide a summary of the proposed content of future guidelines to be released by the ACCC, which will ultimately outline the ACCC’s approach to misuse of market power and concerted practices. The frameworks will help interested parties understand the reforms and provide them with the opportunity to give the ACCC feedback that will inform and improve the guidelines.

Concurrently with the release of this exposure draft, the Department of Communications and the Arts has released a discussion paper on the telecommunications specific anti competitive conduct regime in Part XIB of the Act. This allows the ongoing operation of the anti competitive conduct provisions in Part XIB to be assessed in light of the proposed amendments to section 46.

The Government is committed to ensuring Australia’s competition law provides the best foundation for an innovative, competitive and agile economy. These amendments will make markets work better for the benefit of all Australians and help to lift our long term productivity growth.

The consultation period on the Exposure Draft will run for four weeks until 30 September, and includes public consultation and consultation with the states and territories.

The Exposure Draft Bill and Explanatory Memorandum will be available on the Treasury website.