DLA Piper WIN - Competition Law in 2016 · 2019. 11. 5. · Cartel Case Study Mr Hobby, Managing...
Transcript of DLA Piper WIN - Competition Law in 2016 · 2019. 11. 5. · Cartel Case Study Mr Hobby, Managing...
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A Shifting Landscape
Competition Law in 2016
Simon Uthmeyer, Partner
Alec White, Senior Associate
Anna Parker, Senior Associate
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Outline
New ACCC priorities in 2016
Legislative changes from Harper Review?
Unconscionable conduct – Application in B2B
Cartel Case Study – ACCC v Renegade Gas
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ACCC Priority areas 2016
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Legislative provisions Industries / consumers / providers
• Unfair contract terms • Agriculture sector
• Cartels • Ensuring small business receives benefit from
Industry Codes of Conduct
• Misuse of market power • Vulnerable consumers including indigenous
consumers
• Anti-competitive agreements • New car retailing
• Product safety including recalls of unsafe
products
• Health/medical sector
• Consumer guarantees • Government procurement
• Scams
• Gas inquiry
• Petrol
Note:
Black is retained from 2015
Red is new in 2016
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Changes from Harper Review?
Government released response in November 2015
Preparing exposure draft of legislation
Key changes proposed:
New concerted practices prohibition
Removal of per se third line forcing prohibition
Changes to misuse of market power prohibition?
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Harper Review – concerted practices
Model legislative provisions in Harper Review Final Report
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Harper Review – concerted practices
"The Panel considers that the word ‘concerted’ has a clear and
practical meaning and no further definition is required for the
purposes of a legal enactment"
Jointly arranged or carried out or co-ordinated
Regular and deliberate activity undertaken by two or more
firms, including regular disclosure or exchange of price
information
Not unilateral or mere parallel conduct
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Harper Review – third line forcing
Supplying goods or services (or offering a discount / rebate) on
condition that the purchaser will acquire other goods or
services from a third party
Proposed substantial lessening of competition test
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Supplier A Supplier B
Customer C
A supplies to C on
condition that C also
acquires from B
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Harper Review – market power
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(Screenshots from Google News)
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Harper Review – market power
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Treasury consultation - options
Status quo
Options in between
Harper proposal
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Unconscionable conduct – Key issues
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Applies to B2B transactions
Flexible and expanding
Potential large penalties
Wide range of transactions
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Evolution of Unconscionable Conduct
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Equity:
Blomley v
Ryan
CBA v
Amadio
s51AC
Extends
statutory UC
to B2B
s51AA Codification
of unwritten
law on
equitable UC
Expanded
penalties
ACL: s21
Combined
statutory UC for
B2C and B2B
Ancient
times 2010 1986 1998 2014/15
ACCC v Lux (2013)
• $370k penalty
ACCC v Coles (2014)
• B2B
• $10m penalty
ACCC v WOW (2016)
• TBC
s52A Statutory UC
introduced.
Applies to
consumers
1992
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Two kinds of unconscionable conduct
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Equitable
Unconscionable
Conduct
Statutory
Unconscionable
Conduct
(s21 ACL)
B2C
B2B
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Evolution of Unconscionable Conduct
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Equity:
Blomley v
Ryan
CBA v
Amadio
s51AC
Extends
statutory UC
to B2B
s51AA Codification
of unwritten
law on
equitable UC
Expanded
penalties
ACL: s21
Combined
statutory UC for
B2C and B2B
Ancient
times 2010 1986 1998 2014/15
ACCC v Lux (2013)
• $370k penalty
ACCC v Coles (2014)
• B2B
• $10m penalty
ACCC v WOW (2016)
• TBC
s52A Statutory UC
introduced.
Applies to
consumers
1992
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Equitable UC cases
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Evolution of Unconscionable Conduct
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Equity:
Blomley v
Ryan
CBA v
Amadio
s51AC
Extends
statutory UC
to B2B
s51AA Codification
of unwritten
law on
equitable UC
Expanded
penalties
ACL: s21
Combined
statutory UC for
B2C and B2B
Ancient
times 2010 1986 1998 2014/15
ACCC v Lux (2013)
• $370k penalty
ACCC v Coles (2014)
• B2B
• $10m penalty
ACCC v WOW (2016)
• TBC
s52A Statutory UC
introduced.
Applies to
consumers
1992
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What is unconscionable?
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Taking advantage of
special disadvantage
or vulnerability
Moral obloquy Contrary to
societal norms
Inconsistent with
acceptable
business and
social standards
Unconscionable
Dishonest > Unfair
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ACCC v Lux
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ACCC v Coles
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Tier 1 and 2
suppliers
Tier 3 suppliers
(heavily dependent
on Coles)
Coles
Products
$ Payments
$ Rebates
Efficient ordering
quantities rebate
$ Payments
Data sharing
rebate
Profit Gap
Waste and markdowns
Late / short deliveries
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How does statutory unconscionable
conduct fit with other provisions?
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Unfair
contract
terms Unconscionable
Conduct
Misuse of
Market Power
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Cartels Case Study
ACCC v Renegade Gas and
Speed-E-Gas
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Cartel Case Study
Mr Hobby,
Managing Director
Mr Wilson,
Sales Manager
Mr Berman,
Managing Director
Mr Smith, Sydney
Branch Manager
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Cartel Case Study
The communications led to an understanding:
Stay Away Provision
Replacement Provision
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Cartel Case Study
Once the understanding was reached, the two companies
implemented it internally:
Instructions to staff
Refusing to pay commissions
Warnings to staff
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Federal Court's finding
The conduct was in breach of the prohibitions against cartel
conduct
Melbourne In-house Counsel Day 2016
March 2016
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More information?
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Questions
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