ACCC 2019 focus on consumer guarantees and anti-competitive practices

Large retailers supplying high value electrical appliances and whitegoods, such as refrigerators, computers and washing machines, will be a key enforcement priority for the ACCC in 2019.

“We’re concerned that many manufacturers and large retailers are not complying with consumer guarantee laws and this will be an area of renewed focus for us this year,” ACCC Chair Rod Sims said in a speech to the annual Committee for Economic Development Australia (CEDA) today.

“Electrical and whitegoods products are the second most complained about industry after motor vehicles.”

“Last year we received nearly 9000 contacts about electrical appliances and whitegoods, with three quarters of those relating to break downs or other quality issues.”

Customer loyalty schemes will be another new priority, with the ACCC closely examining the use of any personal data collected, whether consumers receive the benefits promised, and the impact on competing firms and new entrants. These schemes include those in the airline, retail and hospitality sectors.

“While these customer loyalty schemes are ubiquitous across many sectors, questions arise about whether consumers are being properly informed and receiving the benefits touted by many of these programs,” Mr Sims added.

Advertising practices on social media platforms and subscription services will also be under the spotlight, running concurrently with the ACCC’s Digital Platforms Inquiry.

“Social media platforms are used by the vast majority of Australian consumers. We continue to hear about new advertising practices and subscription services that may be misleading consumers, particularly younger users,” Mr Sims added.

The ACCC will also continue to advocate for changes which benefit consumers.  Keeping laws in step with the dynamic market economy has been a vital part of recent ACCC advocacy, including much higher maximum penalties for corporations which breach the consumer law. Maximum penalties for each breach are now the greater of $10 million, or three times the benefit from the breach or, if the benefit cannot be calculated, 10 percent of the annual Australian sales turnover.

“We believe that Parliament, in changing the law, intended that in certain cases in future we will see penalties of over $100 million for breaches of consumer law,” Mr Sims said.

“A new advocacy priority for us is to introduce a prohibition of unfair contract terms. At present, when a contact term is declared to be unfair by a court, it is void but no penalty applies. We believe it is time to prohibit unfair terms and apply a penalty for their inclusion in standard form contracts,” Mr Sims said.

Other ACCC advocacy consumer priorities include:

  • making the case for the introduction of a general safety provision that would prohibit the sale of unsafe goods, requiring companies to take all reasonable steps to ensure products that they are selling are safe
  • engaging in the debate about the adequacy of the laws against companies which engage in harmful or unfair conduct toward consumers

The ACCC’s cartel investigation team expects decisions this year from the Commonwealth Director of Public Prosecutions on three criminal cartel investigations that have been referred to them.  Further cartel investigations are at an advanced stage.

“As these criminal cartel cases are progressed, we are confident they will work as a strong deterrent to egregious and damaging collusive conduct across the Australian business community,” Mr Sims said.

“Turning to competition advocacy, we need as a community to debate how much we want to reduce anti-competitive behaviour and the current trend to company consolidation in many sectors,” Mr Sims said.

The full list of the ACCC’s 2019 enforcement priorities is available at: Compliance & enforcement policy & priorities.

A summary is also available at: 2019 Compliance and Enforcement Priorities.

“2019 will be an important and exciting year for the agency, with the ACCC focusing on its purpose of ensuring markets work for the long term interests of consumers.”

Mr Sims’ full speech is available at: 2019 Compliance and Enforcement Policy