The Competition and Consumer Amendment (Misuse of Market Power) Bill 2017 (Cth) which was passed on 23 August 2017 and the Competition and Consumer Amendment (Competition Policy Review) Bill which was passed but the Parliament today are about ensuring large companies don't stifle competition and ensure that abuses of market power are stopped. The previous laws looked at the purpose of mergers, acquisitions and other actions whereas the new rules examine the potential affects of company activities, as well as their purpose.
ACCC Chairman Rod Sims said, "The reforms to the misuse of market power prohibition and the new prohibition of anti-competitive concerted practices will improve our ability to target conduct harming the Australian economy”.
In support of the legislative changes, the ACCC has established the Substantial Lessening of Competition Unit (SLC Unit), which will be responsible for misuse of market power and concerted practices investigations and litigation within the ACCC.
We feel the effects of corporate power on pricing and choice whenever we enter a supermarket or buy almost any item. Despite the preponderance of brands on the shelves when we shop, the reality is very few companies control those brands. For example, Simplot owns dozens of brands on our supermarket shelves. And while I'm not saying they are doing anything untoward or illegal, control of such a large range of products (and I assume they're making lots of house-branded products for the supermarket chains as well) gives them a lot of power of pricing and distribution.
There are similar examples in other markets - try buying a hard drive that isn't made by Seagate or Western Digital for example.
Any reform to competition law that protects the interests of consumers is a good thing. In most people's eyes, the ACCC has a pretty spotty record when it comes to protecting consumers. They've had some solid wins when it comes to ISPs and their claims for "unlimited" bandwidth and connection performance but if there's someone out there who can explain why fuel prices change across all petrol stations within a few hours across different chains when they are supposedly not colluding I'd love to hear the reasoning as the ACCC has never been able to make a case for collusion between station operators.
Will these changes make any difference?