Reforms to protect beef producers against anti-competitive behaviour in the market place have been welcomed by the Cattle Council of Australia.
Changes to the misuse of market power provisions in the Competition and Consumer Act have been announced by Deputy Prime Minister and Minister for Agriculture Barnaby Joyce.
An ‘’effects test’’ will give the Australian Competition and Consumer Commission meaningful provisions to protect businesses subject to the misuse of market power.
The effects test enables the court to assess whether the conduct is harmful to the competitive process.
Cattle Council of Australia chief executive officer Jed Matz said the reforms were of importance to the beef industry where power was concentrated in the industry’s value chain.
Mr Matz said the limited scope of the current provisions allowed for conduct having an anti-competitive impact on the market place to go unchecked.
“This failing has eroded beef producers confidence in the competition law framework as a whole,’’ he said.
“CCA is supportive of this reform as it strikes a good balance between protecting the competitive process whilst ensuring competitive behaviour and innovation are not stifled.
“The role of competition law framework must be to offer an environment in which competition between businesses can occur to drive efficiency and innovation, for the benefit of consumers.’’
Cattle Council of Australia has pushed for the implementation of the effects test through a submission to the Senate Rural Affairs committee inquiry into the red meat processing industry.
The inquiry into producers’ claims around a lack of transparent pricing information and processor consolidation leading to diminished returns, was sparked by a dispute over pre-sale weighing at Victoria’s Barnawartha saleyards in 2015.
Mr Matz said the reform would open opportunities for cattle producers to have anti-competitive conduct investigated.
“This reform will focus on the effect of the activity by the company, and not their intent,’’ he said.
“The inadequacies of competition law in protecting cattle producers has been clearly illustrated and this will provide a more even market place.’’
Mr Matz said the legislative changes came at a time when the ACCC was focused on agriculture.
He said it marked a concerted effort by peak agricultural bodies to achieve a positive outcome.
“This is about rebalancing the power within the agricultural industry, allowing producers to operate on a level playing field in a fair market place.’’
For further details contact Jed Matz on email@example.com or 0407 124 479.