For more than a decade, the Small Business Development Corporation (SBDC) has pushed for changes to Section 46 of the Competition and Consumer Act in relation to misuse of market power, including via a detailed submission to the Competition Policy Review undertaken by Professor Ian Harper.
Small Business Commissioner, David Eaton, says the SBDC has long advocated for a fairer and more equitable trading environment in which smaller businesses can compete with large businesses.
“The SBDC’s clients, as small business operators, often suffer when businesses with a substantial degree of market power misuse that power,” Mr Eaton said.
“Therefore, the Federal Government’s decision to repeal and replace Section 46 of the Competition and Consumer Act is very welcome, and validates our efforts in pushing for these reforms.
“In keeping with the Harper recommendations, the SBDC supports the inclusion of the term ‘purpose, effect or likely effect’ in lieu of just ‘the purpose test’, as this further advances the protection of overall competition in the marketplace.
“We believe the current focus on the ‘purpose of the conduct’ narrows the spotlight to one competitor, and agree with the Review Panel’s statement that it’s the conduct of the business that affects competition and not the purpose.
“The changes to Section 46 will now prevent firms with substantial market power from engaging in conduct that has the purpose, effect or likely effect of substantially lessening competition,” Mr Eaton said.
Until now, Australia’s misuse of market power provisions have not been reliably enforceable, leaving the way open for unconscionable behaviour by big businesses over smaller businesses.
Media contact: Di Graham (08) 6552 3218 / 0432 750 565