Output restrictions may also be thought of as supply or acquisition restrictions. They occur when competitors agree to prevent, restrict or limit the volume or type of particular goods or services available.
Read about cartel activities the ACCC has investigated.
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It is illegal for competitors to work together to fix prices rather than compete against each other. This conduct restricts competition, and can force prices up and reduce choices for consumers and other businesses.
Bid rigging, also referred to as collusive tendering, occurs when two or more competitors agree they will not compete genuinely with each other for tenders, allowing one of the cartel members to ‘win’ the tender. Participants in a bid rigging cartel may take turns to be the ‘winner’ by agreeing about the way they submit tenders, including some competitors agreeing not to tender.
Market sharing occurs when competitors agree to divide or allocate customers, suppliers or territories among themselves rather than allowing competitive market forces to work.
Businesses that make agreements with their competitors to fix prices, rig bids, share markets or restrict outputs are breaking laws and stealing from consumers and businesses by inflating prices, reducing choices and damaging the economy.
It is against the law for businesses to fix prices, restrict outputs or allocate customers, suppliers or territories. But the ACCC can grant businesses an exemption providing protection from legal action under the Competition and Consumer Act when such conduct results in benefits to the public.