Anti-competitive conduct

Section 45 of the Competition and Consumer Act prohibits contracts, arrangements, understandings or concerted practices that have the purpose, effect or likely effect of substantially lessening competition in a market, even if that conduct does not meet the stricter definitions of other anti-competitive conduct such as cartels. A number of factors are considered by the courts to reach a decision:

Is there an 'agreement' or 'concerted practice' caught by the Act?

Under the Act, agreements, contracts, arrangements and understandings possess similar meanings. Essentially they involve the development of a plan of action between two or more people that may not be enforceable at law but they have every intention of following.

In relation to the 'arrangement', the court has said:

... when each of two or more parties intentionally arouses in the others an expectation that he will act in a certain way, it seems to me that he incurs at least a moral obligation to do so. An arrangement as so defined is therefore something whereby the parties to it accept mutual rights and obligations.

TPC v Nicholas Enterprises Pty Ltd (No 2) (1979) FLR 83

As to 'understanding':

An understanding must involve the meeting of two or more minds. Where the minds of the parties are at one that a proposed transaction between them proceeds on the basis of the maintenance of a particular state of affairs or the adoption of a particular course of conduct, it would seem that there would be an understanding ...

Top Performance Motors Ltd v Ira Berk (Qld) Pty Ltd (1975) 24 FLR 286

To arrive at an understanding or to make an arrangement it is not necessary for anything to be written down. In fact, such agreements are often not put into writing. Nothing need even be expressed—a ‘nod and wink’ is sufficient.

If necessary, the court will infer the requisite 'meeting of minds' from circumstantial evidence such as evidence of joint action, similar pricing structures, or even from evidence of opportunities the parties had to reach an understanding.

It is important to consider both what is actually said and what each party understands to be the position.

Concerted practices

A concerted practice involves communication or cooperative behaviour between businesses that may not amount to an understanding but goes beyond a business independently responding to market conditions.

Most commonly, concerted practices will involve a pattern of cooperative behaviour or communications between two or more businesses. This may involve communicating in public or private.


At an industry event, Bank A discloses, to its main competitors, its intention to increase its home loan interest rates by 25 basis points. This disclosure is made prior to Bank A’s disclosure to the market.

Bank A’s competitors do not provide pricing information in return. However, they each circulate Bank A’s pricing information internally. Bank A’s competitors know that there will be less competitive pressure on their loan product pricing. They do not seek to undercut Bank A but rather move their rates broadly in line with Bank A. Bank A notes the reaction of its competitors and this practice continues over time.

If it does not reach the level of an understanding, the ACCC considers that the conduct of Bank A and its competitors is likely to amount to a concerted practice.

Unlike some conduct where there are strict prohibitions, such as Cartels and Imposing minimum resale prices, concerted practices are only prohibited if they substantially lessen competition in a market.

Guidelines on concerted practices

Concerted practices are a new concept in the Competition and Consumer Act.

The ACCC’s Guidelines on Concerted Practices describe the general approach the ACCC will take in investigating alleged anti-competitive concerted practices.

What is the market?

To determine whether conduct has any effect in a market, you need to determine what the market is. One widely-accepted judicial definition is the following:

A market is the area of close competition between firms or ... the field of rivalry between them. ... Within the bounds of a market there is substitution—substitution between one product and another, and between one source of supply and another, in response to changing prices. ... In determining the outer boundaries of the market we ask a quite simple but fundamental question: if the firm were to ‘give less and charge more’ would there be, to put the matter colloquially, much of a reaction.

Queensland Cooperative Milling Association Ltd/Defiance Holdings Ltd, re proposed merger with Barnes Milling Ltd (1976) ATPR 40-012

This process of market definition is purposive. The High Court of Australia has observed that:

Identifying a market and defining its dimensions is "a focusing process", requiring selection of "what emerges as the clearest picture of the relevant competitive process in the light of commercial reality and the purposes of the law”.

ACCC v Flight Centre [2016] HCA49 at [69]

A market usually has four important elements:

  • product
  • geography
  • level of function
  • time.


The range of goods or services (including substitutes for them) that will satisfy customer requirements. Customer response to price changes is an important clue to whether products are in the same market.


The geographic area within which a product is traded—for example, the Sydney metropolitan newspaper market, the south-east Queensland gas market.

Level of function

The particular market level at which a company operates—for example, manufacturing, wholesale, retail.


The period of time over which substitution possibilities are considered. Generally, substitution possibilities are considered for the period of the foreseeable future such that substitutes will constrain the exercise of significant market power by the merged entities.

Each of these items must be examined in coming to a conclusion regarding the relevant market.

Does the conduct substantially lessen competition in that market?

'Substantial' is an important concept in competition and consumer law and it arises in a number of provisions.

'Substantial’ has been defined in case law as large, weighty, big, real or of substance or not insubstantial. However it is not straightforward; the meaning of substantial depends on the context and in a relative sense.

An effect is considered to be substantial if it is important or weighty in relation to the size of the particular market.

In Stirling Harbour Services Pty Ltd v Bunbury Port Authority [2000] FCA 38; (2000) ATPR 41-752, Justice French said that to work out whether competition is being substantially lessened...

...there [must] be a purpose, effect or likely effect of the impugned conduct on competition which is substantial in the sense of meaningful or relevant to the competitive process.

Other types of anti-competitive behaviour

Anti-competitive behaviour


Imposing minimum resale prices

Misuse of market power

Apply for an authorisation

Applying for exemptions - protection from legal action where the public benefit outweighs any public detriment

Relevant sections of the Competition and Consumer Act

s.45 — Anti-competitive agreements

More information

Guidelines on Concerted Practices

Contact the ACCC