Competition Law

Australian Competition Law and Policy Discussion

Private member’s bill madness

Posted by Julie Clarke on 18 June 2013

A couple of private member’s bills were introduced yesterday to get the ball rolling on this election season’s competition law craziness.

Supermarket shopping

First up we have Rob Oakeshott MP’s  Competition and Consumer Amendment (Strengthening Rules About Misuse of Power) Bill 2013. This proposes insertion of a subsection 46(1AAAA) – just to keep with the Act’s horrendous numbering trend and would introduce an effects based test for conduct engaged in by corporations with substantial market power. It also proposes further investigation powers for the ACCC where the ACCC ‘reasonably believes that circumstances exist to indicate that there has been or might be a contravention of section 46’. The EM talks a lot about cheap milk and Rob Oakeshott’s press release emphasises the bill’s aim to ‘help farmers’, so there’s no need to guess at the genesis for the bill.

This, however, is nothing compared to the industry-specific and convoluted bill introduced by Bob Katter MP and, not suprisingly at all, supported by Nick Xenophon MP and Andrew Wilkie MP.  The Supermarket Dominance Bill 2013 would make it an offence (subject to $50m penalty) to operate a supermarket business where that business (and related supermarket businesses) has a supermarket market share of: more than 40% for year 2 or more than 35% for year 3 etc to more than 20% for any later year. Essentially it requires reduction in market share of the major supermarkets to no larger than 20% progressively over a six year period. Other similar offences are included. It goes beyond supermarket retailing to ‘household retail businesses’ as well, aiming to ‘ensure that the supermarket giants’ vast operations in “household retail businesses” are progressively reduced to 20% total market share throughout a 6 year period’ (EM). This bill also involves setting up a Commissioner for Food Retailing.

The Katter bill is one of the strangest bills I’ve read … and there have been some shockers relating to competition policy in Australia. Margy Osmond of the ANRA has described the bill as ‘ill-conceived and populist’ (see Jacob Greber and Claire Stewart, ‘MP’s pressure supermarkets’ (Australian Financial Review, 18 June 2013). Hard to argue with that assessment.  Fortunately, as private member’s bills they are unlikely to come to anything; but let’s just hope they’re not an early indication of the craziness that awaits as we head full swing into election campaigning in a climate where supermarket bashing is as popular as ever.

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