Key concerns released at midway point of the Government’s Competition Policy Review

At the midway point of the Federal Government’s Competition Policy Review, the Review Panel has released a statement about the five key concerns of those who have been consulted during the review.

The Review Panel received around 300 submissions on its Issue Paper, which was released in April 2014. The Review Panel also convened business forums and consulted widely with business and consumers.

One of the key concerns that has emerged is whether there is a level playing field when businesses compete with government, especially local government.

People expressed concern about the advantages of government, especially in debt financing. They submitted that government should not be permitted to be both rule-maker and service provider in the same industry.

They also expressed concern about the handling of complaints about government anti-competitive behaviour and the lack of sanctions against government.

Other concerns included the drafting of certain provisions of the competition law, the adequacy of the powers of the Australian Competition and Consumer Commission (ACCC), the concerns of small business and the power of Woolworths and Coles.

Dr Nick Seddon, a legal commentator and the author of the legal text Government Contracts: Federal, State and Local, submitted that until competition law binds government at all levels, including in the procurement process, the law will be distorted.

Dr Seddon said that government business through procurement was huge and a very important part of our economy, but that the problem with the current law was that government business in the narrow sense applied by the courts – broadly entrepreneurial activities – is, by comparison, miniscule.

He said this meant that governments were immune from competition law for almost all their commercial activities.

The Review Panel is due to release a draft report at the end of September 2014. There will then be another opportunity for consultation before the final report is released in 2015.

Crown Law’s Commercial and Property Team will continue to provide updates on the review throughout the year.

Crown Law can assist State Government departments and agencies with any compliance checks that might be required following the review.

The information in this publication is provided for general purposes only. It is not to be relied on as a substitute for legal advice. Crown Law and the Department of Justice and Attorney-General accept no liability for losses caused by reliance on the material in this publication. Formal legal advice should be obtained for particular matters.

Published: 17 August 2014

Author: Melinda Pugh