ACCC proposes to approve membership rules for Consumer Electronic Clearing System

The Australian Competition and Consumer Commission proposes to authorise certain regulations governing the operation of the Consumer Electronic Clearing System managed by the Australian Payments Clearing Association.

The CECS provides a forum in which participants in the EFTPOS and/or ATM systems agree on minimum mandatory standards and procedures for the clearing and settlement of EFTPOS and ATM transactions.  These standards include specifications for equipment, cards, communication links and message formats.  The CECS Regulations and Manual have been authorised by the ACCC since 2000.

APCA sought reauthorisation only for certain provisions of the CECS Regulations and Manual relating to the certification of participants in CECS and suspension and termination of CECS membership.

"The ACCC considers that the requirement that CECS participants be certified, and the CECS suspension and termination provisions, will produce a public benefit by promoting the efficient operation and enhanced security and integrity of the consumer electronic clearing system," ACCC chairman Graeme Samuel said.

"Without these provisions, the confidence of users with the CECS system would likely be diminished."

The ACCC also considers that the anti-competitive detriment associated with the certification, suspension and termination provisions is likely to be minimal.

"The ACCC considers that the certification, suspension and termination provisions do not place unreasonable requirements on participants.

"Further, refusal of certification or termination of CECS membership does not preclude an institution from participating in the EFTPOS or ATM system. Many financial institutions are not members of CECS and instead enter into agreements with a CECS member to process their transactions in CECS and clear and settle transactions on their behalf."

The ACCC is now inviting comments on the draft determination. The ACCC's draft determination and information about making a submission will be available from the ACCC website, www.accc.gov.au/AuthorisationsRegister and by following the links to this matter.  Parties wishing to make submissions should do so by 4 December 2009.

Authorisation provides immunity from court action for conduct that might otherwise raise concerns under the competition provisions of the Trade Practices Act 1974. Broadly, the ACCC may grant an authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.