At the beginning of each year, in February, the Australian Competition and Consumer Commission (‘ACCC’) releases its Compliance and Enforcement Priorities. Unusually, but due to the impact of COVID-19 and the measures introduced by Australian State and Federal Governments, the ACCC has recently announced adjustments to those enforcement priorities taking into account those measures and the current economic climate. While the 2020 Compliance and Enforcement Priorities remain in place, the ACCC have identified a number of specific competition and consumer issues arising from the impact of COVID-19 which will receive additional attention.
If you are a business dealing with consumers you should be aware that the ACCC are continuously updating its website with information on the rights and obligations of businesses in response to events caused by the pandemic. As always, product safety will continue to be a key priority. Additionally, the ACCC have warned that businesses are expected to uphold their obligations under the Australian Consumer Law (‘ACL’) to not mislead customers, act unconscionably or seek to rely on unfair terms in standard form contracts.
For businesses that are involved in the production and sale of ‘essential products’, the ACCC has stated that price gouging conduct will be closely scrutinised. Businesses using the impact of COVID-19 as the basis for a significant price increase will need to be able to substantiate that cost increase or be liable for misleading or deceptive conduct in breach of the ACL. Extreme price increases may also amount to unconscionable conduct. The ACCC has announced that it will be calling out any businesses that are engaging in excessive pricing, particularly in the energy, communications, and petrol sectors.
The impact of COVID-19 on most Australian markets has also had an impact on the ACCC’s approach to the granting of authorisations to support coordination between competitors that would ordinarily be prohibited. Where the ACCC has deemed that conduct necessary and in the public interest as a result of COVID-19 authorisations have been granted, such as co-operation between Australian supermarkets.
The ACCC are continuing to assess proposed mergers. The ACCC anticipates however a necessary extension of the usual timelines for merger clearance as a result of the social-distancing measures adopted by the ACCC. These measures include the cancellation of all non-essential meetings with external parties and travel and a larger proportion of ACCC staff working remotely so that communication is conducted to a large extent via phone and Skype. To ensure the most effective processing of merger clearance in 2020 and throughout the COVID-19 period, the ACCC has issued more detailed merger clearance guidelines. The ACCC is not asking potential merger parties to delay applications at this stage but we recommend that if you are considering a transaction, you consider as early as possible whether merger clearance is required to minimise the impact of any delay on your transaction.
Should you have any questions regarding the ACCC’s priorities and how it may impact your business please contact Rebecca Halkett.