ACCC compliance and enforcement strategy

To achieve its compliance objectives the ACCC employs three flexible and integrated strategies:

• Enforcement of the law, including resolution of possible contraventions both administratively and by litigation.
  
• Encouraging compliance with the law by educating and informing consumers and businesses about their rights and responsibilities under the Competition and Consumer Act.
  
• Working with other agencies to implement these strategies.

These strategies are discussed further below.

The ACCC has two additional enforcement strategies, the cooperation policy and the immunity policy for cartels. These are discussed briefly below.

Policies and strategies discussed:

 

Cooperation policy

The ACCC encourages persons and companies who might have contravened the Competition and Consumer Act to come forward and cooperate with the ACCC to address these possible contraventions.

The ACCC may recognise cooperation by:

• permitting complete or partial immunity from ACCC action
• making submissions to the court for a reduction in penalty, or 
• agreeing to an administrative settlement instead of litigation.

This policy is flexible, with the ACCC determining each case on its merits. Further information regarding the ACCC cooperation policy for enforcement matters is available in the publication ACCC cooperation policy for enforcement matters.

Immunity policy for cartels

The ACCC also has an immunity policy designed to encourage self-reporting of cartel involvement. The immunity policy confers immunity from ACCC action to the first eligible cartel participant to report involvement in a cartel. Immunity is provided subject to certain conditions being met, including full, frank and truthful disclosure and continued cooperation with the ACCC’s investigation and any subsequent legal proceedings against other participants. Further information regarding the ACCC Immunity policy for cartels is available in the publication ACCC immunity policy for cartel conduct. 

Compliance and enforcement outcomes

The ACCC uses a range of compliance and enforcement tools in order to encourage compliance with the Competition and Consumer Act. In deciding which compliance or enforcement tool (or the combination of such tools) to use, the ACCC’s first priority is always to achieve the best possible outcome for the community.

Education, advice and persuasion

The ACCC makes comprehensive use of educational campaigns to provide information and advice to consumers and businesses, and to use persuasion to encourage compliance with the Competition and Consumer Act. The ACCC takes the firm view that prevention of a breach of the Competition and Consumer Act is always preferable to taking action after a breach has occurred.

The ACCC provides targeted and general publications; it liaises broadly with business, consumer and government agencies about the Competition and Consumer Act and the ACCC’s role in its administration. The ACCC aims to ensure that consumers are sufficiently well-informed to benefit from, and stimulate, effective competition.

Communicating its enforcement role is fundamental to the effectiveness of the ACCC’s information and liaison activities.

Voluntary industry self-regulation codes and schemes

The ACCC encourages and assists genuine voluntary compliance initiatives by individual businesses and industry sectors. These initiatives range from individual trader compliance programs to sector-wide initiatives, including industry charters and voluntary codes of conduct that apply the requirements of the Competition and Consumer Act to the specific circumstances of a particular industry sector.

Administrative resolution

In some cases—for example, where the ACCC assesses potential risk flowing from conduct as low—the ACCC may accept an administrative resolution. Depending on the circumstances, administrative resolutions can range from a commitment by a trader in correspondence to a signed agreement between the ACCC and a trader setting out detailed terms and conditions of the resolution. Administrative resolutions generally involve the trader agreeing to stop the conduct and compensate those who have suffered a detriment because of it, and to take other measures necessary to ensure that the conduct does not recur. The ACCC is unlikely to accept an administrative resolution for conduct that recurs after having been subject to a previous administrative resolution.

Infringement notices

The ACCC may issue an infringement notice where it believes there has been a contravention of the Competition and Consumer Act that requires a more formal sanction than an administrative resolution but where the ACCC considers that the matter may be resolved without legal proceedings.

Section 87B enforceable undertakings

The ACCC often resolves contraventions of the Competition and Consumer Act by accepting court enforceable undertakings under s. 87B of the Act. In these undertakings, which are on the public record, companies or individuals generally agree to:

• remedy the mischief 
  
• accept responsibility for their actions 
  
• establish or review and improve their trade practices compliance programs and culture.

Court cases

Legal action is taken where, having regard to all the circumstances, the ACCC considers litigation is the most appropriate way to achieve its enforcement and compliance objectives. The ACCC is more likely to proceed to litigation in circumstances where the conduct is particularly egregious (having regard to the factors set out at Prioritisation of enforcement matters and the exercise of the ACCC's discretion), where there is reason to be concerned about future behaviour or where the party involved is unwilling to provide a satisfactory resolution.

Under the Competition and Consumer Act, legal action may result in the court:

• making declarations that a company or individual has contravened the Act 
  
• making injunctions restraining current or future conduct, or requiring respondents to take certain action 
  
• requiring respondents to publish notices about their conduct and corrective advertising, and to disclose relevant information to others (for example to their customers) 
  
• making findings of fact that show contraventions of the Act so that damages may be recovered by consumers and businesses affected by the conduct 
  
• making orders to achieve financial redress for consumers or businesses harmed by the conduct 
  
• making various non-punitive orders, including community service or probation orders (which may include orders for implementing a compliance or an education and training program) 
  
• imposing significant pecuniary penalties for breaches of the consumer protection or restrictive trade practices provisions (the ACCC is more likely to seek pecuniary penalties in matters which result in significant consumer detriment, involve blatant conduct or where the traders or individuals concerned have a history of past conduct) 
  
• convicting persons found to have contravened various offence provisions in the Act, and/or
• imposing prison sentences for serious cartel conduct.