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Government shakes up competition laws

Adam Zuchetti
Adam Zuchetti
16 August 2017 1 minute readShare
Power, arm wrestle

In a long-awaited move, the government last night introduced legislation which it says will strengthen the misuse of market power provisions.

In a statement announcing the changes, Treasurer Scott Morrison said the Harper Competition Policy Review found existing laws (known as Section 46 of the Competition and Consumer Act) do not effectively target anti-competitive behaviour, nor are they being reliably enforced.

“The new Section 46 is robust law that will prevent firms with substantial market power engaging in conduct that harms competition in Australian markets,” he said.

“This is particularly important for Australia’s 3.2 million small businesses, which make up more than 97 per cent of all businesses.”

Under the changes, it will be illegal for corporations to engage in any conduct that has the intention or even likely effect of lessening market competition.

Other amendments arising from the Harper Review are currently before Parliament, Mr Morrison said.

“These include replacing the never-used and unworkable price-signalling provisions with a general prohibition on concerted practices with the purpose or effect of substantially lessening competition, and reforming merger clearance and authorisation processes.”

The amendments still have to pass through Parliament, which is expected, and will take effect “as soon as possible”. The long-awaited changes come after public consultation and a Senate inquiry following the release of the Harper Review into competition in 2015.

Australian Small Business and Family Enterprise Ombudsman Kate Carnell welcomed the changes, saying it “levels the playing field for small business and safeguards competition”.

“The legislation will stop large businesses with significant market power from using that power to impact broadly upon a market with adverse consequences for competitors,” she said.

“The introduction of an effects test that lowers the threshold for establishing misuse of market power enhances fairness and effective competition.”

Institute of Public Accountants (IPA) chief executive officer, Andrew Conway, added that the changes will “enhance Australia’s capacity to compete globally.”

“The amendment will help address anti-competitive conduct and protect the competition process rather than the interests of individual players in the market, he said.

“We commend the government for introducing the changes we have been fighting for – changes that will better protect small business in a more equitable, competitive market.”


Government shakes up competition laws
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Adam Zuchetti
Adam Zuchetti

Adam Zuchetti is the former editor of MyBusiness and a senior freelance media professional, specialising in the fields of business, personal finance and property. In 2020, he also embarked on his own business journey – inspired in part by the entrepreneurs and founders he had met through his journalistic work – with the launch of customised pet gifting and subscription service Paws N’ All.

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