At his annual speech to the Committee for Economic Development of Australia recently, ACCC Chairman Rod Sims outlined the Commission’s compliance and enforcement policy for 2016.
The ACCC has used the CEDA event platform for the past several years to give fair warning as to the regulatory focus for the coming year.
You can read the full text of the speech here. A summary of the areas of focus is below.
Business as usual
The Commission will continue its focus on cartel conduct, anti‑competitive behaviour and misuse of market power. Mr Sims said that the Commission currently has in the region of 20 cartel investigations on foot, and anticipates there will be both criminal and civil proceedings sometime this year. (If there is a criminal case, it will be the first since the criminal provisions came into effect in 2009.)
(The Federal Court recently dismissed a claim by the ACCC regarding cartel conduct in the egg industry. See our blog on this case.)
On the consumer side, expect truth in advertising to remain a ‘special pet’ in terms of enforcement priority.
Ongoing and elevated areas of focus
- Indigenous consumers: protecting the rights of vulnerable consumers has long been on the ACCC’s radar. However, it has elevated the protection of Indigenous consumers, in recognition of the challenges Indigenous communities (particularly those in remote areas) face in enforcing their consumer rights. Mr Sims describes this elevated focus as a ‘significant change’ to ACCC policy, borne of dubious sales tactics Indigenous communities are often subjected to. In 2013, the ACCC launched the Your Rights Mob Facebook page, aimed at informing Indigenous consumers about their rights. The page has achieved success in giving Indigenous communities a readily accessible avenue to raise issues with the Commission.
- Vulnerable and disadvantaged consumers: consumer protection activities regarding issues of particular relevance to older consumers and recently arrived immigrants. Last year, the Commission worked closely with the older consumer sector to identify issues of particular concern. The Commission also took action against two retailers of adjustable beds regarding misleading claims in relation to the beds and other mobility products. The retailers paid $20,400 in penalties. Mr Sims also highlighted a case relevant to immigrants – the Federal Court recently found a Box Hill company, Clinica Internationale Pty Ltd, engaged in misleading and unconscionable conduct regarding training courses which would ‘guarantee’ immigrants both a permanent residency visa and work as cleaners. Orders are yet to be issued, but the court has indicated that it will order the company to refund fees paid by course participants, and fines against both the company and the person operating it in excess of $1m.
- Medical & health sectors: competition and consumer issues in this sector will remain a priority, building on success in 2015 with cases such as the ‘Nurofen targeted pain’ claims (see our blog on this). Mr Sims said that ‘health service providers need to ensure their disclosure practices are in line with the Australian Consumer Law’, and indicated that the Commission will take action in this area. The Commission will also cast a keen eye over misleading health claims in relation to food products, with investigations ‘well advanced’ in this area.
- Consumer product safety: a continuing focus by its very nature, with particular emphasis on highlighting the dangers of button batteries, quad bikes and Infinity cables (which are likely to become brittle this year, with electric shocks and fires a very real possibility).
- Industry codes: while industry codes of conduct generally will be under the spotlight, the new Food and Grocery Code of Conduct will be firmly in the spotlight. Mr Sims said ‘We will take enforcement action wherever needed to ensure the Code succeeds’. You’ve been warned.
- Scams disruption: the Commission will continue its public awareness campaigns in an effort to thwart scammers, particularly those preying on consumers who are duped into sending money overseas.
- Consumer guarantees: never far from the Commission’s radar, representations regarding extended warranties has re‑emerged as a priority area. There have been several noted cases whereby retailers have provided blanket ‘no refund’ policies or refused warranty claims outside the manufacturer’s warranty period.
- New car retailing: following on from its investigation into the after sales care practices of Fiat Chrysler Australia, the Commission will urge car manufacturers and retailers to ensure that their practices in this area are compliant with the Australian Consumer Law, especially in relation to warranty claims. The Commission is also close to wrapping up its investigation into emissions issues relating to Volkswagen cars sold in Australia – an issue that has been devastating for the company globally.
- Extension of unfair contract terms provisions to small business: with the new provisions coming into effect in November 2016, this year will be about doing the groundwork so that businesses of all sizes know their rights and obligations.
- Competition and consumer issues in the agriculture sector: a new priority, and key focus for market studies to improve knowledge and understanding of competition issues in the agricultural supply chain.
That’s enough to be getting on with.
Questions? Comments? Concerns?
If you have any questions about your competition and consumer law compliance, or the extension of the unfair contract terms regime, please don’t hesitate to give us a call. We’d be pleased to assist.