Dealing with other professionals

Fee setting

There is nothing in the Competition and Consumer Act 2010that regulates the prices charged by professionals. As such, professionals are free to decide what fees they will charge clients for their services.

The Competition and Consumer Act prohibits agreements that fix prices between competitors. That is, a collective decision among competing professionals as to the price they charge for their services would be likely to breach the Act.

To ensure compliance with the Competition and Consumer Act and to minimise legal risks, professionals should set their fees to be consistent with the business structure they have chosen. For example, professionals who practise independently as sole practitioners or individually incorporated practices must individually set their own fees. In contrast, a group of professionals who have chosen to incorporate their practices can set their fees collectively (within that practice).

Collective boycotts

Professionals should ensure that they do not enter into any agreements with competing professionals to exclude or limit dealings with a particular supplier of goods or services, or customer, or a particular class of suppliers or customers. Such conduct may constitute a ‘primary boycott’ and is prohibited under s. 45/4D of the Competition and Consumer Act.

'Secondary boycotts' are also prohibited under the Act. A secondary boycott is action by one person in concert with a second person (where 'person' can be an individual, corporation or trade union) which hinders or prevents a third person from supplying or acquiring goods or services to/from a business.

The Competition and Consumer Act prohibits collective boycotts but not individual boycotts. Any independent professional is free to individually decide whether or not to deal with a particular supplier or customer.

Examples:

• Following the institution of proceedings in December 2002, the Federal Court declared that a Melbourne doctor attempted to induct a boycott of bulk-billing and after-hours services by doctors wanting to practice at a Berwick Springs medical centre.
• In July 2007 the Federal Court imposed penalties totalling $110,000 on two Adelaide cardiothoracic surgeons over moves to prevent competition from two other cardiothoracic surgeons in the Adelaide metropolitan area. The ACCC had instituted proceedings alleging that the two surgeons engaged in anticompetitive conduct over the provision of cardiothoracic surgical services to private patients in or near South Australia.

For detailed information see the ACCC free publication Professions and the Competition and Consumer Act.