The Chairman of the Australian Competition and Consumer Commission Rod Sims says 2017 will see its enforcement teams hone in on misleading and deceptive practices, anti-competitive conduct and unfair contract terms affecting small businesses.
Speaking at a Committee for Economic Development of Australia (CEDA) event in Sydney today, Mr Sims launched the ACCC’s 2017 Compliance and Enforcement policy, which details the industries and issues the competition and consumer regulator will focus on in the year ahead.
Clear priorities will be unfair contract terms, cartels, and misconduct in the health, construction and agriculture sectors.
“The ACCC does a lot of educating and working with businesses, large and small, on compliance with laws that are set up to ensure the market economy runs as it should, to the benefit of living standards and household budgets,” Mr Sims said.
“Education plays an important role in compliance, but sometimes we need to send a stronger message to businesses. Court action not only helps to sharpen businesses’ focus on what is and isn’t acceptable under the law, but acts as a deterrent to others that may be tempted in a race to the bottom."
“I can foreshadow that we will have a big focus on unfair contracts in 2017, following the introduction of new laws to protect small business in 2016. What that means is that large companies can no longer have unilateral terms in their standard contracts that put small businesses at a significant disadvantage,” Mr Sims said.
Mr Sims says cartel conduct is another area in which significant penalties, including jail sentences, can be used as a deterrent.
“Last year, ACCC investigations led to two criminal cartel charges and we have advanced investigations into other alleged cartels.
“Unfortunately, I fear that only jail sentences for individuals in prominent companies will help to send the appropriate deterrence messages that cartels seriously damage competition and the economy as a whole,” Mr Sims said.
Mr Sims said particular areas of enforcement for the Commission in 2017 will be the health and energy sectors.
“We’ve also been working with the private health insurance industry for a number of years to improve compliance with the Australian Consumer Law. We have one private health insurer before the courts and I can confirm there will be further enforcement action in 2017.”
The ACCC says fresh concerns about anti-competitive conduct has led to the establishment of a new commercial construction investigation unit within the ACCC.
“A newly established team will focus on competition issues in the commercial construction sector across Australia. We have continuing investigations in that area and we will put additional resources towards new ones,” Mr Sims said.
The ACCC has also signalled it would broaden the scope of its work in relation to consumer guarantees. In particular, looking at the application of consumer guarantees to both complex products and services. This will include consideration and investigations into practices in the airline, telecommunication and motor vehicle industries.
The Compliance & Enforcement Policy is available at: Compliance & Enforcement Policy
The Chairman's speech is available at: CCA compliance in interesting times
Notes to editors
The ACCC has around 65 investigators in each of its competition and consumer enforcement teams, around 40 consumer product safety experts, and around 15 working on compliance education for consumer and small business.
Given the wide-ranging responsibilities of the ACCC, the regulator must effectively allocate teams to conduct that not only results in great consumer detriment but that may also act as a deterrent to other market participants.
The ACCC Compliance and Enforcement Policy will prioritise and consider around 500 of the approximately 200,000 reports of potential breaches of the CCA the Competition and Consumer Act received each year from consumers and businesses. This in turn leads to court action around 30 times per year.
The ACCC will also refer matters to state and territory fair trading agencies and ombudsman services. In some cases, police agencies are best placed to handle issues or complaints.
The ACCC also engages directly with specialist regulators such as the Therapeutic Goods Association (TGA, Food Safety Australia New Zealand FSANZ), and building and electrical safety regulators.