South Australian milk vendors will be able to begin to collectively negotiate the terms and conditions of distribution contracts with milk processors under an interim authorisation* granted by the Australian Competition and Consumer Commission.
The Milk Vendors Association (SA) has sought authorisation for proposed collective bargaining with National Foods Milk Limited and Dairy Vale Foods Limited.
"The interim authorisation will allow South Australian milk vendors to make use of the collective bargaining process in the current round of contract renegotiations", ACCC Chairman, Mr Graeme Samuel, said today.
"For smaller businesses such as milk vendors, collective bargaining can be a means of redressing an imbalance in bargaining power when negotiating with larger businesses and achieving, what they consider to be, more favourable commercial outcomes".
The ACCC found that there is likely to be little, if any, public detriment in allowing the arrangements to go ahead in the short term.
"There is currently a large disparity in bargaining power between the processors and the vendors. Also, any permanent change to contracts before the ACCC issuing its final determination will only occur if the processors agree".
While interim authorisation allows the parties to engage in the conduct while the ACCC considers the merits of the substantive application, a decision to grant interim authorisation is not necessarily indicative of the ACCC's final decision.
This interim authorisation does not compel any party to take part in the proposed arrangements but will provide immunity against prosecution under the Trade Practices Act 1974 for the conduct covered. Individual vendors and processors retain sole discretion about whether they choose to take part in the collective bargaining arrangements.