Australia: from the enforcer
Address: 23 Marcus Clarke Street, Canberra ACT 2601, Australia
Tel: +61 2 6243 1111
Fax: +61 2 6243 1199
Tel: +61 2 6243 1129
Email: [email protected]
Tel: +61 2 6243 1138
Email: [email protected]
Executive General Manager Specialised Enforcement and Advocacy Division
Tel: +61 2 9230 9130
Email: [email protected]
Questions and answers
How long is the head of agency’s term of office?
Rod Sims was appointed chair of the Australian Competition and Consumer Commission (ACCC) in August 2011 for an initial five year period. Mr Sims was reappointed in 2016 and then again in 2018 until 2022, making him the longest serving chair of the ACCC.
When is he or she due for reappointment?
Mr Sims’s appointment expires on 31 July 2022.
Which posts within the organisation are political appointments?
The ACCC has six commissioners, including the chair and two deputy chairs, all of whom are appointed by the Governor General after consultation with the state and territory jurisdictions. Terms are set for up to five years and are not affected by changes of government.
What is the agency’s annual budget?
The ACCC’s 2020–2021 budget was A$270 million. The budget covers the range of the ACCC’s functions and responsibilities, which includes enforcement of the Competition and Consumer Act 2010 (CCA) as well as other regulatory functions.
How many staff are employed by the agency?
As of 31 December 2020, the ACCC had 1,184 staff (including ACCC and Australian Energy Regulator employees, part-time employees and employees absent on leave and secondments).
To whom does the head of the agency report?
The ACCC is an independent statutory agency and reports to the Australian parliament. Its competition and consumer functions fall principally within the responsibility of the Treasury and the Treasurer.
Do any industry-specific regulators have competition powers?
If so, how do these relate to your agency’s role?
May politicians overrule or disregard authority’s decisions? If they have ever exercised this right, describe the most recent example.
Does the law allow non-competition aims to be considered when your agency takes decisions?
Generally, no. However, entities that wish to engage in certain anticompetitive arrangements or conduct can apply to the ACCC for an exemption. An exemption provides protection from legal action under the CCA and may be granted when such arrangements or conduct results in a net public benefit. When considering whether a net public benefit will result, the ACCC is able to consider relevant non-competition benefits.
Which body hears appeals against the agency’s decisions? Is there any form of judicial review beyond that mentioned above? If so, which body conducts this? Has any competition decision by the agency been overturned?
In competition matters, the ACCC does not have the power to determine that the CCA has been contravened. If the ACCC considers an entity is likely to have contravened the CCA, it takes action in the Federal Court of Australia. Criminal cases are referred to Australia’s independent prosecutor, the Commonwealth Director of Public Prosecutions (CDPP).
Where a contravention of the CCA is proven, the Federal Court has the power to order penalties and redress under the CCA. Decisions of the Federal Court can be appealed to the Full Federal Court and then to the High Court of Australia. The Australian Competition Tribunal conducts merits reviews of determinations made by the ACCC in respect of authorisation and notification (exemption) decisions, merger authorisation decisions and various regulatory decisions under the CCA – matters of access to regulated infrastructure services.
In addition, some ACCC actions and decisions are subject to judicial review by the Federal Court or administrative review by the Administrative Appeals Tribunal.
Has the authority ever blocked a proposed merger? If yes, please provide the most recent instances.
Where the ACCC decides to oppose a merger and the parties decide to proceed, the ACCC can apply to the Federal Court to determine whether the merger breaches section 50 of the CCA.
For example, in 2019 the ACCC announced it would oppose TPG Telecom Limited’s proposed merger with Vodafone Hutchison Australia Pty Ltd, which was subsequently litigated in the Federal Court. In February 2020, the Federal Court declared that the proposed merger would not substantially lessen competition.
Has the authority ever imposed conditions on a proposed merger? If yes, please provide the most recent instances.
The ACCC cannot impose conditions, but where the ACCC has concerns that a proposed merger or acquisition is likely to substantially lessen competition in contravention of section 50 of the CCA, the ACCC can accept a court-enforceable undertaking from the merger parties under section 87B of the CCA to remedy those concerns. The ACCC has also alleged that the proposed acquisition would contravene section 45 of the CCA, which prohibits contracts, arrangements or understandings that would, or would be likely to, substantially lessen competition.
The most recent examples of remedies accepted from a merger party to address competition issues were:
- Elanco Animal Health Incorporated's proposed acquisition of Bayer Aktiengesellschaft’s animal health business;
- Mylan N.V.’s proposed acquisition of Upjohn Inc.; and
- Asahi Group Holdings's proposed acquisition of Carlton & United Breweries (owned by Anheuser Busch InBev SA/NV).
Has the authority conducted a Phase II investigation in any of its merger filings? If yes, please provide the most recent instances.
In relation to its informal merger clearance process, a Phase II review is triggered with the issue of a statement of issues (which is a public statement released by the ACCC outlining the basis and facts upon which we have come to a preliminary view that a proposed merger or acquisition raises competition concerns and requires further investigation) or when remedies are proffered by the merger parties.
In 2020, four merger reviews concluded by the ACCC involved the release of a statement of issues, and three were finalised with remedies.
Has the authority ever pursued a company based outside your jurisdiction for a cartel offence? If yes, please provide the most recent instances.
The ACCC has taken several cases against companies based outside Australia for cartel conduct. Following an ACCC investigation instituted in November 2016, the CDPP laid charges against Kawasaki Kisen Kaisha Ltd (K-Line) and Nippon Yusen Kabushiki Kaisha (NYK) for engaging in cartel conduct relating to the transportation of motor vehicles to Australia between 2009 and 2012. The Federal Court convicted both K-Line and NYK of criminal cartel conduct, and they were ordered to pay a fine of A$34.5 million and A$25 million respectively.
Do you operate an immunity and leniency programme? Whom should potential applicants contact? What discounts are available to companies that cooperate with cartel investigations?
Yes. The ACCC’s immunity policy for cartel conduct, which provides for immunity to the first eligible applicant, is available at: www.accc.gov.au/publications/accc-immunity-cooperation-policy-for-cartel-conduct.
All applications for immunity from criminal prosecution and civil penalty proceedings should be made to the ACCC. An application for immunity can only be made by, or on behalf of, a party to the cartel, be they an individual or a corporation.
An immunity application or a request for a marker can be made orally or in writing. The only valid way to make an application or request a marker is by contacting the General Manager, Competition Enforcement and Cartels (currently Rob Ghali), on the ACCC Immunity Hotline, +612 9230 3894, during ACCC business hours, or by sending an email to [email protected]
The ACCC has a cooperation policy (under which it has the discretion to provide immunity or leniency) in circumstances flowing from cooperation in civil enforcement matters under the CCA that is viewable at: www.accc.gov.au/publications/accc-cooperation-policy-for-enforcement-matters. Prospective applicants should contact the General Manager during business hours.
Is there a criminal enforcement track? If so, who is responsible for it? Does the authority conduct criminal investigations and prosecutions for cartel activity? If not, is there another authority in the country that does?
Yes. The CCA provides criminal and civil sanctions for cartel conduct. Under the criminal regime, the ACCC is responsible for investigating cartel conduct and the CDPP is responsible for prosecuting offences under Commonwealth law, including cartel offences, in accordance with the Prosecution Policy of the Commonwealth.
Guidelines setting out how the ACCC will investigate alleged cartel conduct and make decisions in relation to referral of matters for possible criminal prosecution are available at: www.accc.gov.au/business/anti-competitive-behaviour/cartels.
In 2014, the ACCC entered a memorandum of understanding with the CDPP, setting out respective responsibilities for criminal matters.
Are there any plans to reform the competition law?
Australian competition laws were substantially reformed in 2017 following the Harper Review (see below). While the laws are subject to ongoing minor or machinery amendments, the ACCC is not aware of plans for substantial reform.
When did the last review of the law occur?
Australia’s competition law has been reviewed on several occasions since its introduction in 1974, including as part of a comprehensive review of national competition policy in 1993 and a review of the competition provisions of the law in 2003, which were undertaken by the Hilmer and Dawson Committees, respectively.
The most recent review of Australian competition policy was the Harper Review in 2015, which considered and made recommendations concerning Australian competition law, and the Australian government accepted the majority of these recommendations.
Do you have a separate economics team? If so, please give details.
Yes, the ACCC has a full-time team of economists. In-house economics advice is provided by two groups:
- the Competition and Consumer Economic Unit, which provides economic advice to the ACCC’s competition and consumer areas; and
- the Regulatory Economic Unit, which provides economic advice to the ACCC and the Australian Energy Regulator on regulatory matters.
The ACCC has a chief economist and engages external economic experts as needed.
Has the authority conducted a dawn raid?
Yes. The ACCC has strong powers to compel companies or individuals to produce information, produce documents and attend an interview. The ACCC may, in certain circumstances, seek search warrants from a magistrate and execute these on company offices and the premises of company officers.
Has the authority imposed penalties on officers or directors of companies for offences committed by the company? If yes, please provide the most recent instances.
Matters pursued by the ACCC through the courts have in some cases resulted in penalties on officers and directors of companies for offences committed by the company.
For example, in August 2019, the ACCC commenced civil proceedings against BlueScope Steel Limited (BlueScope) and a former executive, Mr Jason Ellis, in relation to alleged cartel conduct in the supply of flat steel products, which are an essential material in a number of important sectors of the Australian economy. The ACCC alleged that Mr Ellis attempted to induce agreements with BlueScope’s competitors, to fix and/or raise the level of pricing for flat steel products supplied in Australia.
In December 2020, Mr Ellis pleaded guilty to Inciting the obstruction of an ACCC Investigation Into alleged price fixing by BlueScope Steel and was sentenced to eight months suspended imprisonment.
What are the pre-merger notification thresholds, if any, for the buyer and seller involved in a merger?
In Australia, there is no compulsory pre-merger notification process. However, parties are encouraged to approach the ACCC on a voluntary basis to seek the ACCC’s view on those proposed mergers or acquisitions that may raise competition issues. The ACCC’s indicative notification threshold (where the products of the merger parties are either substitutes or complements; and the merged firm will have a post-merger market share of greater than 20 per cent in the relevant markets) is intended to provide a starting point for identifying those mergers that may raise competition concerns and therefore require investigation.
Are there any restrictions on investments that involve less than a majority stake in the business?
There is no threshold shareholding for the purposes of section 50 of the CCA, and all acquisitions are therefore subject to the CCA.
An acquisition of less than a controlling interest that nevertheless alters the incentives of all parties may give rise to a contravention of section 50 of the CCA. Where share acquisitions do not deliver control, the ACCC will take into consideration inter-company relationships, director’s duties and a range of other factors including the:
- actual ownership share of the minority interest;
- existence of any contractual or other arrangements that may enhance the influence of the minority interest;
- size, concentration, dispersion and rights of the remaining ownership shares; and
- board representation and voting rights of the minority interests.
Australia: from the enforcer's competition economists
Address: GPO Box 3131, Canberra, ACT 2601, Australia
Tel: +61 2 6243 1111 / 1123
Fax: +61 2 6243 1199
Executive General Manager, Legal and Economic Division
Questions and answers
How many economists do you employ?
The Australian Competition and Consumer Commission (ACCC) generally employs staff with degrees in economics or law, as well as other related fields, to assist it in fulfilling its responsibility of administering the Competition and Consumer Act 2010 (formally the Trade Practices Act 1974), as well as its responsibilities under a range of additional legislation. The ACCC employs around 16 in-house specialist consulting economists. Around half focus on providing economic advice and analysis on merger, adjudication and enforcement investigations. However, the ACCC is also the sectoral regulator in a number of monopoly infrastructure areas and so others focus on assisting in that role. In recent years, all economists have also been increasingly involved in assisting on the ACCC’s various market studies. The purpose of this group is to supplement the economic expertise within the ACCC’s operational areas and to provide internal consultancy advice on novel, unusual or difficult problems that emerge in the ACCC’s regulatory and investigative activities. External economic consultants are also engaged on complex matters, particularly when a matter proceeds to review by the Australian Competition Tribunal or to litigation.
Do you have a separate economics unit, or ‘bureau’?
Yes. In September 2013, the ACCC established the Economic Group, bringing together two previously separate units: the Competition and Consumer Economic Unit; and the Regulatory Economic Unit. Combining the two into one group was undertaken to provide a greater ability to flexibly manage resources to meet the needs of the organisation and manage workloads, and to provide more opportunities for staff development, career progression, diversity of work and peer support across the two economic areas.
Do you have a chief economist?
In December 2015, the ACCC appointed Dr Graeme Woodbridge to the role of chief economist (a newly created role). Dr Woodbridge holds a bachelor of economics (honours) from Monash University and a doctorate of philosophy (economics) from UCLA.
To whom does the chief economist report?
Richard Home, executive general manager, Legal and Economic Division.
How many of your economists have a PhD in industrial economics?
One ACCC staff member has a PhD in industrial economics. A total of 10 staff in the economics unit have PhDs in economics, with most specialising in microeconomics.
Does the agency include a specialist economist on every case team? If not, why not?
A significant proportion of ACCC staff are trained economists, so it is not necessary for specialist economists to work on each matter. The ACCC uses specialist economic advice for more complex matters.
Is the economics unit a ‘second pair of eyes’ during cases – it is one of the agency’s checks and balances? If not, why not?
Yes. The specialist economists play an important advisory role in relation to the development of economic arguments in merger, adjudication and enforcement cases, as well as industry regulation and market studies.
How much economics work is outsourced? What type of work is outsourced?
Work is outsourced when the project team, in consultation with the in-house economic and legal advisers and relevant ACCC or AER committee, considers it necessary. There is no particular type of work that is outsourced. It can depend on a number of factors, including the complexity of the matters involved, the requirement for specialist knowledge on a particular issue, and the overall workloads of the Economic Group.
In proceedings before the Federal Court of Australia, external economists must be engaged where expert economic testimony is required. For expert evidence to the admissible, independence from the agency is a requirement of the Australian Federal Court rules.