Commonwealth Government's GST advertising

The Australian Competition and Consumer Commission advised the Shadow Attorney-General, Mr Robert McClelland, today that advertising by the Commonwealth Government in relation to the New Taxation System is not subject to the Trade Practices Act 1974.

The ACCC believes the Act does not apply to political advertising and has taken this stance consistently over the years with complaints from all parties.

The Act prohibits conduct by business in trade or commerce which is misleading and deceptive or which is likely to mislead or deceive. The Commonwealth Government is not generally bound by the Act, except when it is engaging in a business.

The point has been made that the advertisements recently complained of are paid for by the government as part of its public awareness campaign and this differentiates them from advertising during elections. However, the law does not make this distinction, it only covers advertisements issued in trade or commerce. For the Act to apply to them, new legislation would be required.

Mr McClelland had asked the ACCC to consider whether the Commonwealth Government had engaged in misleading and deceptive conduct in relation to its advertisements about the GST. He also asked that the ACCC consider the position of the broadcasters and publishers of the advertising material.

The complaint is one of a number of complaints that the ACCC has received from political parties alleging that other political parties are engaging in misleading and deceptive conduct.

The ACCC, and its predecessor the Trade Practices Commission, have consistently taken the view since 1974 that the Act does not generally apply to political advertisements or the dissemination of government information because these activities are not in trade or commerce. Sections 52 and 53 of the Act, which deal with false, misleading or deceptive representations or conduct, are generally confined to statements in trade or commerce.

In 1974, the Trade Practices Commission noted that there would no doubt be constitutional difficulty in the Act going beyond trade or commerce, but really the whole thrust of the Act is in that area, and the Parliament might well have thought it inappropriate in any event that the Act should attempt to supervise argument in political, religious and other matters.

The 1991 Report of the Senate Select Committee on Political Broadcasts and Political Disclosures' also addressed this issue. At that time, the Trade Practices Commission confirmed that it would be very difficult to apply section 52 of the Act to ideas and noted that such a prohibition would be outside of the scope and intent of the Act itself which relates primarily to trade and commerce in goods rather than ideas. The ACCC took the same view in 1993 when Mr Andrew Robb, then Campaign Director for the Liberal Party, complained that advertisements scheduled by the Australian Labor Party in the course of the Federal Election were misleading and deceptive.

The ACCC advised the Liberal Party on that occasion that the matter was not an appropriate complaint for the ACCC to investigate as the conduct was not in trade or commerce and was thus not within the scope of the TPA. The ACCC also noted at that time that the ACCC had considered similar complaints related to advertising of a political nature in the past and has formed similar views.

A June 1997 Federal Parliament Joint Standing Committee Report said the aim of political truth in advertising would be 'unachievable through legislation'. The Committee considered it inappropriate to make laws about misleading and deceptive conduct in relation to political advertising.

The ACCC notes that the matter has very recently been debated in Parliament and it considers this is an issue for Parliament.

The ACCC also noted, in relation to the position of broadcasters and publishers of the recent Government information, that the Commonwealth Government specifically claims responsibility for authorising the advertisements.

Members of the public who view or read such an advertisement would understand the Commonwealth Government to be the source of the information contained in the advertisement.

The broadcaster or publisher is conveying to the public statements for which another named person, the Commonwealth Government, expressly takes responsibility. Thereby, in effect, the broadcaster or publisher would be seen as disclaiming any responsibility for the accuracy of the statements made in the advertisement. The ACCC is of the view that in those circumstances the conduct of the publisher or broadcaster does not constitute misleading or deceptive conduct in contravention of section 52 or 53 of the Act.

The ACCC's role is to apply the law without fear or favour to whomever it applies. It does not go beyond the provisions of the law stipulated by Parliament, nor does it stop short of applying these provisions".