… Guidelines 2.23: When assessing effect or likely effect on competition, the ACCC may undertake a ‘with or without test’. Section 46 now prohibits a firm with a substantial degree of market power from engaging in conduct that has the purpose, effect or likely effect of substantially lessening competition in a market. by charging an excessively high price ), and if the purpose, effect or likely effect of the conduct is to substantially lessen competition in the downstream market. Paragraph 2.8 Interim Guidelines/2.10 Guidelines has changed to incorporate reference to potential supply. The ACCC’s Misuse of Market Power Guidelines state that while a firm’s commercial rationale may help the ACCC to understand the conduct and assess its purpose/ effect on competition, it is not a defence + Employees and representatives should . The final sentence of paragraph 2.14 has changed (changes in bold): Interim Guidelines: 'Substantial market power may also enable a firm to reduce the quality of goods or services, raise barriers to entry or slow innovation', Guidelines: 'Substantial market power may also enable a firm to, In paragraph 2.15 there is a reference to QCMA factors re: competitive constraint. ... Link Reference to 'as a bundle' has been changed to 'as a package' and the relevant heart condition related to Drug B in the example is now 'comparatively rare'. offering loyalty rebates can substantially lessen competition. Interim Guidelines 2.27: When assessing whether the conduct has the purpose, effect or likely effect of substantially lessening competition, the ACCC will consider the commercial rationale for the conduct. misuse of market power guidelines and draft Framework for concerted practices guidelines. It prohibits a firm with substantial market power from engaging in conduct with the purpose, effect or likely effect of substantially lessening competition. For instance, The key clauses in … The old and new paragraphs are extracted below (change in bold): The introductory sentence in the section on SLC has changed - the term SLC goes from being 'well understood' to being a 'longstanding' test! where a firm offers its retail customers volume rebates which are conditional on the b) states a willingness to supply a key input to its competitors in a downstream market, but only on terms at which no competitor would reasonably be willing to buy the input (for example, by charging an excessively high price), and if the purpose, effect or likely effect of the conduct is to prevent or hinder those competitors from being able to compete in the downstream market. away. observed that: Identifying a market and defining its dimensions is ‘a focusing process’, requiring Two paragraphs have been added before the 'Product market' sub-heading. Share and print this article. conduct, including the firm’s commercial rationale. The final sentence in paragraph 2.16 (that the ACCC will assess each case on its merits ...) of the Interim Guidelines has been moved into a separate paragraph; it now appears (unaltered) as para 2.17 in the Guidelines. Guidelines: However, in limited circumstances a firm with a substantial degree of market power rebates). Under the new laws, businesses will be able to seek formal authorisation from the ACCC before engaging in such conduct, thereby avoiding unwanted investigations or … Geographic market, 3 Types of conduct that may involve a contravention of s 46, 4 Types of conduct that are not likely to contravene s 46, Investing in new production technology to increase efficiency, 6 The ACCC's approach to investigating alleged contraventions of s 46. It is well recognised that market definition is not an exact science and that it is not possible or necessary to identify precise boundaries. rebates which are conditional on the customer purchasing a very large quantity of its The ACCC Draft Framework for Misuse of Market Power Guidelines, published in September 2016, stated that the ACCC would take into account “legitimate business reasons” for conduct impugned under the new section 46. Guidelines: ... competition agencies and courts have regarded some types of conduct as having greater potential to contravene s. 46. Competitors jockey for Businesses may also be subject to action by private parties for contraventions of s. 46. It seems the most the regulator would do is introduce some “sunshine” to the impacts of these algorithms which are currently hidden from view, and potentially refer the matter to the ACCC for investigation if this was perceived to amount to a misuse of market power. The ACCC previously released a draft framework for s 46 guidelines in September 2016. Interim Guidelines: ... competition agencies and courts have regarded some types of conduct as having greater potential to involve a misuse of market power, either in isolation or combined. retailer purchasing a large proportion of its requirements from the firm (loyalty ACCC v Cement Australia: another ACCC misuse of market power case turns to ash. The Australian Competition and Consumer Commission (ACCC) has published guidelines on how it plans to interpret and enforce the new concerted… Minor modification to para 3.2 (para 3.1 also alters reference from 'misuse of market power' generally to a specific reference to s 46): Generic references to 'misuse of market power' have been replaced with specific references to s 46 (here and in subsequent sections). Competition Law In Australia 2019 competition. By consent, the court declared that the access fee was likely to substantially lessen competition and was a "misuse" of TasPorts' market power. The misuse of market power provisions in section 46 of the Competition and Consumer Act 2010 (Cth) could be up for review. These were very similar to the draft framework previously released. It will be worth keeping an eye on this -particularly in relation to s 46 – the misuse of market power alleged is: ‘refusing to enter into agreements with competing suppliers of processing services that would have allowed Cabcharge’s payment … History. Guidelines 2.24: There is no legislative definition of ‘substantially lessen competition’; however, the test is longstanding within Australia’s competition laws. Businesses may also be subject to court proceedings brought by private parties … The Digital Platforms Inquiry Final Report recognised the complexity and opacity of the operation of ad tech services and recommended a separate inquiry into ad tech services and advertising agencies. widespread consumer detriment. Section 46 of the Competition and Consumer Act 2010 (CCA) was revised effective from 6 November 2017. Paragraph 2.21 Interim Guidelines has been split into two parts and in the first part (now para 2.22 of the Guidelines') an example has been added. occur where a rebate is conditional on a distributor meeting certain sales targets. When businesses are concerned that their proposed conduct may give rise to a breach of the competition provisions of the CCA, but they consider their conduct would result in public benefit, they can seek authorisation from the ACCC. In August 2018 the ACCC released Guidelines on Misuse of Market Power. by Elizabeth Richmond, Alexia Smyth-Kirk . These interim guidelines sets out how the ACCC proposes to interpret s. 46 and describes the general approach we will take in investigating alleged contraventions of … to foster. Guidelines for authorisation of conduct (non-merger) , March 2019. The submission attaches an independent opinion of the draft changes to section 46, the misuse of market power provision, by Neil J Young QC. Interim Guidelines: However, in limited circumstances, a refusal to deal by a firm with a substantial degree of market power may amount to a misuse of market power. The possession of market power of itself is not unlawful. Interim Guidelines 2.21: When assessing effect or likely effect on competition, the ACCC may undertake a ‘with or without test’. In many cases, including where the firm offering a rebate has substantial market power, rebates are an example of the benefits of the competitive process, incentivising retailers to promote the supplier’s products and reducing the overall price customers pay for goods and services. which the good or service under analysis is supplied. In para 3.16 the words 'in the downstream market' have been added when referring to the conduct preventing 'equally efficient competitors' from competing on the merits. Section 46 now prohibits a firm with a substantial degree of market power from engaging in conduct that has the purpose, effect or likely effect of substantially lessening competition in a market. sales, the more effective competitors injuring the less effective by taking sales For instance, if a firm is engaging in conduct to make its products more attractive to customers, the conduct is unlikely to substantially lessen competition. A list of key changes from the 2017 Interim Guidelines to the current Guideline is provided below. The ACCC has also released its draft framework for proposed guidelines on the new misuse of market power prohibition as well as the proposed new prohibition against concerted practices. These are not new - they previously appeared at the end of the 'geographic market' section and have been relocated here. Some details have changed in the example provided, including the percentage increase in transmissions required to be purchased to qualify for the rebate. by offering consumers more compelling offers. Following passage of legislation in 2017 the ACCC released interim guidelines for comment. The ACCC has instituted proceedings against Cabcharge alleging misuse of market power under s 46 and anti-competitive conduct under s 45.. The ACCC has also released its draft framework for proposed guidelines on the new misuse of market power prohibition as well as the proposed new prohibition against concerted practices. On 31 August 2018 the ACCC released Guidelines on misuse of market power. The new para 2.22 reads (new portion in bold): When assessing a firm’s conduct, the ACCC considers the nature and extent of that The Ad Tech Inquiry follows on from Recommendation 5 of the final report of the ACCC’s Digital Platforms Inquiry(released in July 2019). Interim Guidelines: 'Bundling' occurs when a supplier offers a lower price if two products are Share. Guidelines: However, in limited circumstances, a refusal to deal by a firm with a substantial degree of market power may amount to a contravention of s. 46. It provides (in part): (2) A corporation that has a substantial degree of market power in a trans‑Tasman market must not take advantage of that Further details on how the ACCC considers section 46 operates are set out in the ACCC’s Guidelines on Misuse of Market Power. Misuse of Trans-Tasman market power Section 46A prohibits the misuse of market power by a corporation with substantial degree of power in trans Tasman market. Previous iterations. “The ACCC will soon be able to act against concerted practices that substantially lessen competition and take … For instance, where a firm offers its customers long-term supply terms with volume The ACCC has released “Interim Guidelines on misuse of market power”, and is seeking submissions from interested parties by 24 November 2017. As the Digital Advertising Services Inquiry Interim Report says, The Government directed the ACCC to conduct the inquiry into digital advertising te… See ACCC Guidelines on Misuse of Market Power. Concurrently with the release of the Exposure Draft legislation, the ACCC released its …

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