Opportunity for Exporters to Improve the Competitive Framework in Australia

by K&L Gates LLP
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Have Your Say on the Issues Paper on Australia's Competition Policy Review before 10 June 2014

The Competition Policy Review Panel (Review Panel) has released its much anticipated Issues Paper on the 'root and branch' review of Australian competition laws and policy.

It is a wide ranging review which is intended to address regulatory impediments to competition, competitive neutrality in respect of government provided goods and services, potential regulatory reform of industry specific sectors, Australia's competition laws and the institutional framework for competition policy.

The review provides a real opportunity for offshore exporters of goods to Australia to advocate for reform of any regulatory restrictions which adversely affect competition. The Review Panel has promised to undertake extensive consultation on the Issues Paper, including:

  • public forums to be held in May 2014
  • written submissions and feedback from interested parties, due 10 June 2014.

Consumers, businesses of all sizes and governments at all levels are encouraged to get involved.

If your business would like to provide input on any issue that affects the competitive process in the Australian economy, whether this be broad competition issues or specific sector based issues, we encourage you to partake in the consultation process.

Background to Competition Policy Review

The 'root and branch' review is the first comprehensive review of Australia’s competition laws and policy in over 20 years.

The Prime Minister and the Minister for Small Business announced a review of competition policy on 4 December 2013. On 27 March 2014, the Minister for Small Business announced the Review Panel and released the final Terms of Reference following consultation with the States and Territories.

The Review Panel will be led by Professor Ian Harper (Deloitte Access Economics partner) with Su McCluskey (Chief Executive Officer of the Regional Australia Institute), Michael O’Bryan (senior barrister at the Victorian Bar) and Peter Anderson (former Chief Executive of the Australian Chamber of Commerce and Industry) as panel members.

The Issues Paper was released on 14 April 2014. The deadline for submissions in response to the Issues Paper is Tuesday, 10 June 2014. A further consultation process will be undertaken following the release of a draft report (expected around September 2014) and a final report is expected to be provided to the Australian Government within 12 months (in early 2015).

The Competition Policy Review will examine the broader competition framework to ensure that it continues to play a role as a significant driver of productivity improvements, and to ensure current laws are operating as intended and are effective for all businesses, big and small.

The broad Terms of Reference mean that the Review Panel can make wide ranging recommendations to promote competition across the Australian economy and to ensure that the framework is responsive to today's economy and resilient to any changes that may emerge.

Offshore Exporters of Goods to Australia

A particular objective of the Review Panel is to consider ways to ensure Australians can access goods and services at internationally competitive prices. The following question raised in the Issues Paper is relevant to those who export consumer goods to Australia:

  • Is there a case to regulate international price discrimination? If so, how could it be regulated effectively while not limiting choice for consumers or introducing other adverse consequences?

International price discrimination occurs when sellers charge different prices in different countries and those prices are not based on the different costs of doing business in each country. Australian consumers and businesses may be paying more for their products than their counterparts in comparable countries.

In Canada, the Government recently announced that it plans to introduce legislation to address country specific price discrimination against Canadian consumers. Australian competition laws do not specifically prohibit price discrimination, though anti-competitive conduct relating to price discrimination may be prohibited by other provisions of the Competition and Consumer Act 2010 (Cth) (CCA).

The Review Panel has also identified the following related issue: 

  • Should any current restrictions on parallel importation be removed or altered in order to increase competition?

A parallel import is a non-counterfeit product imported from another country without the permission of the intellectual property owner. The above issue is likely to be of particular relevance to the computer software, information technology, music and book industries. Consumers and business may try to find ways around international price discrimination, including by parallel importation. The Issues Paper also identifies an opportunity for exporters to seek the repeal or reform of regulations which restrict imports into Australia:

  • Are there import restrictions, bans, tariffs or similar measure that, on balance, are adversely affecting Australians?

The supply of goods into the Australian market may be limited by import restrictions. There have been import restrictions imposed to protect local producers through the use of tariffs on, for example, imported clothing.

Have Your Say

This is the first opportunity in more than 20 years for businesses to have their say on competition policy issues. Submissions are not limited to the current competition laws and institutions, but extend to include any law, regulation or practice that can affect competition.

Businesses who export consumer goods to Australia should consider the Issues Paper and what submissions they would like to make, which may include:

  • direct responses to all or some of the questions raised in the Issues Paper
  • submissions on the impact of the current regulatory framework on competition within your industry, and why changes might or might not be required
  • submissions on the regulatory burdens that impact on competition and what reform might be required to improve the competitive environment.

Businesses can either:

  • make formal written submissions
  • 'Have your say' which allows businesses to respond to all or some of the eight high-level key questions listed in the Issues Paper without the need for a detailed written submission.

Submissions may be made until Tuesday, 10 June 2014 and can be lodged electronically or by mail.

If your business would like to have your say on any issue that affects the competitive process in the Australian economy, we encourage you to partake in the consultation process.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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