Tuesday, 23 February 2021 23:59

ACCC sets out compliance, enforcement priorities for 2021 Featured

ACCC Chair Rod Sims ACCC Chair Rod Sims

Sales practices in Australia’s domestic travel sector, competition in aviation and the conduct of some caravan manufacturers - along with sales issues with digital platforms, energy and telecommunications and other business and industry sectors - have been laid out by Australia’s competition and consumer watchdog, the ACCC, in its compliance and enforcement priorities for 2021.

Australian Competition and Consumer Commission Chair Rod Sims said on Tuesday, in his annual Committee for Economic Development Australia (CEDA) address in Sydney, that a number of the compliance priorities related to consumer and competition issues arising from the COVID-19 pandemic.

Sims said the ACCC’s COVID-19 Enforcement Taskforce would continue to closely monitor forward sales practices by travel businesses, noting “concerns about misrepresentations in advertising and marketing material targeted at consumers”.

“Competition in the COVID-hit aviation industry remained fragile, so the ACCC would be scrutinising behaviour that could further damage competition,” Sims said.

“The ACCC will, for example, be closely monitoring the plans by the regional operator Rex to enter the major domestic routes, including those connecting Sydney, Melbourne and Brisbane, with a particular focus on Rex’s ability to access slots at Sydney Airport.”

The caravan industry experienced significant growth during 2020 as a result of international travel restrictions - and the ACCC said it continued to receive complaints and concerns about caravan manufacturers failing to comply with consumer guarantee obligations.

“In 2021 the ACCC will be looking to improve industry compliance with consumer guarantees across a range of high value goods, particularly motor vehicles and caravans,” Sims said.

“Despite the pandemic, the ACCC received a high volume of complaints about motor vehicles consumer guarantee issues in 2020.

“Enforcement action against a number of motor vehicle dealers and then leveraging these enforcement outcomes to achieve broader industry behavioural change continues to be a key project for the ACCC,” Sims said.

The ACCC’s 2021 priorities included two “crucial” product safety measures; implementation of new safety standards for button batteries to prevent injury and death to children, and monitoring of the government’s new mandatory standards for quad bikes, also designed to save lives.

Sims said the pricing and selling practices of essential services, combined with the lack of transparency in their pricing, would also continue as an area of concern for the ACCC.

“Unfortunately we have had to take considerable enforcement action in the electricity and telecommunications sectors in the last year, and this will continue in 2021,” Sims said.

“Importantly, new prohibitions in the electricity market include a requirement that electricity retailers pass on the significant reductions in wholesale electricity costs we have seen over the past year. We are actively monitoring costs and retailers’ price responses and asking certain retailers to justify their prices.”

“Consumers saw their electricity prices rise enormously over many years; now they need to see them fall considerably. This is only fair.”

Sims said the ACCC would take targeted action against some funeral businesses following concerns about the use of market power and “unconscionable conduct” in the sector.

Sims noted that the ACCC’s specialised enforcement team focused on commercial construction and would forcefully continue its activities in 2021, and in the finance sector the ACCC would be following through on recommendations from its Home Loan Price Inquiry final report released by the Treasurer in December 2020.

“The franchising and agriculture sectors, as well as its investigations into the practises of the digital platforms, would all continue to be priorities during 2021, Sims said.

“The ACCC does not directly target economic growth or inequality, but our work has important implications for both. For example, a lack of competition will see less investment, innovation and lower productivity. Unchallenged economic rents, of course, favour those who benefit from them at the cost of those who do not.

“These points are more important than ever with the continuing effect of and recovery from COVID-19,” Sims concluded.

The ACCC’s full list of 2021 priorities are:

  • Consumer issues related to the promotion and sale of products in the context of the COVID-19 pandemic, including travel and event cancellations.
  • Competition issues in the context of the COVID-19 pandemic, including in the domesticair travel market.Competition and consumer issues in the funeral services sector.
  • Competition and consumer issues relating to digital platforms.
  • Competition and consumer issues arising from the pricing and selling of essential services, with a focus on energy and telecommunications.
  • Promoting competition and investigating allegations of anti-competitive conduct in the financial services sector.
  • Conduct affecting competition in the commercial construction sector, with a focus on large public and private projects and conduct impacting small business.
  • Ensuring that small businesses receive the protections of the competition and fair trading laws, including franchising. Ensuring compliance with mandatory industry codes of conduct in the agriculture sector, namely the Dairy Code of Conduct and the Horticulture Code of Conduct.
  • Empowering consumers and improving industry compliance with consumer guarantees, with a focus on high value goods including motor vehicles and caravans.
  • Implementing the new safety standards for button batteries, with a focus on promoting compliance through education. Conducting education and surveillance activities and enforcing compliance in relation to the new quad bike safety standard.

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