ACCC sets the bar for Sideshow Alley arrangements
The Australian Competition and Consumer Commission has issued a draft decision setting out a number of changes it expects to see in relation to anti-competitive arrangements between showmen that attend agricultural shows in much of Australia, ACCC Chairman, Professor Allan Fels, announced today.
The draft decision deals with an application for authorisation* made by the Showmen's Guild of Australasia for arrangements within the Guild's Code of Practice and its Rules. The application also sought authorisation for the Guild to negotiate with show societies on behalf of its members in relation to the organisation of the sideshow area including rents charged to showmen. These negotiations are often referred to as collective bargaining arrangements.
The Guild describes itself as a 'trade association for showmen'. Showmen are the operators of sideshow amusements at agricultural shows. The Guild represents showmen in the ACT, New South Wales, the Northern Territory and in Queensland. In its draft decision, the ACCC has stated that it will not authorise* the arrangements until the Guild makes significant changes to reduce their anti-competitive effects. The ACCC is concerned that the arrangements between Guild showmen have the effect of restricting the ability of non-guild showmen to operate in competition with them.
For example, the ACCC is concerned over arrangements administered by the Guild which allocate spaces to showmen in the sideshow area at the majority of agricultural shows. The arrangements give priority to Guild members and provide that guild members can occupy the same space year in, year out. The ACCC is of the view that the arrangements restrict the ability of show societies to offer opportunities to non-Guild showmen.
"Where there is a restriction in the ability of businesses to compete, consumers miss out on the benefits of competition. Competition provides choice to consumers in price, quality and service", Professor Fels said.
The ACCC is also concerned that proposed arrangements to allow the Guild to negotiate on behalf of their members with show societies may have some anti-competitive effect.
"As a collective group the Guild is likely to have significant bargaining power in relation to small show societies that are often staffed by community volunteers and they could drive a very hard bargain that they may not have been able to as individual showmen", he said.
However, the ACCC accepts that the operation of the Guild, which incorporates the Code, the Rules and collective bargaining, is likely to produce some benefits to the public such as:
- assisting small show societies in organising their sideshow area and to some extent attracting more showmen to attend their shows. A successful show often relies on a well attended sideshow area.
- reducing the costs and efforts for show societies in making arrangements with showmen, who are often on the road, and making it easier for show societies to run a successful show.
A successful show can bring both economic and social benefits to communities and in particular regional and rural communities.
Where the Guild is prepared to make the amendments set out in the draft decision, the ACCC has indicated that it would be more likely to grant authorisation in its final decision. Some of these changes would require the Guild to amend its Code and Rules and in including changes which would reduce the effects of the space allocation arrangements administered by the Guild.
The changes expected by the ACCC are designed to increase the potential for genuine competition between showmen and to expand the choices for show societies and consumers. More competition between showmen could bring lower prices and greater choice for rides and amusements at a large number of agricultural shows.
"In making its draft decision the ACCC has also made it very clear to the Guild and to showmen that they must not agree to fix the price of their rides to consumers and they must not collectively boycott any agricultural shows", Professor Fels said.
Before making its final decision, the ACCC provides interested parties with the option of calling a pre-decision conference and providing additional submissions.