Overview

The Australian Competition and Consumer Commission (ACCC) administers, enforces and ensures compliance with the Competition and Consumer Act 2010 (CCA), including the Australian Consumer Law (ACL). This work enhances the welfare of Australians by promoting competition and fair trading and protecting consumers from unfair business practices. The ACCC and Australian Energy Regulator (AER) also regulate national infrastructure services and other markets where there is limited competition and natural monopoly characteristics. In the March 2012 quarter, the ACCC undertook a range of activities that benefited both businesses and consumers.

In the March 2012 quarter the Full Federal Court imposed a pecuniary penalty of $3.61 million against Singtel Optus Pty Ltd for engaging in conduct that was liable to mislead in relation to the advertising of certain broadband plans as part of its ‘Think Bigger’ and ‘Supersonic’ promotional campaigns. Optus had appealed the primary judge’s decision on penalty on several grounds including findings on certain matters. While the Full Federal Court allowed the appeal, it imposed a substantial penalty and stated that the seriousness of the conduct and the many circumstances of the case warranted such a penalty.

The ACCC reaffirmed its commitment to protecting consumers from businesses which engage in anti-competitive conduct by instituting proceedings in the Federal Court against travel agency Flight Centre Limited. The ACCC alleges that Flight Centre attempted to induce competitors to enter into price fixing arrangements and the purpose and likely effect of the arrangements sought by Flight Centre was to maintain the level of Flight Centre’s commissions. In another case this quarter, the ACCC instituted proceedings against Apple alleging that it engaged in misleading conduct in relation to its launch and promotion of the latest version of its iPad with Wi-Fi + 4G.

To provide further guidance to business and consumers about their rights and obligations under the ACL the ACCC released its consumer guarantees national awareness campaign—‘If it’s not right, use your rights. Repair, Replace, Refund. This campaign aimed to increase consumers’ awareness of their rights when they buy goods and services that are faulty, unsafe or do not work as intended or fail to meet the specified requirements.

On 14 March 2012, the ACCC in collaboration with CHOICE hosted the Ruby Hutchinson memorial lecture which was delivered by the Age Discrimination Commissioner, The Hon Susan Ryan AO, entitled ‘Age discrimination and the internet—older people in the 21st century.’ The lecture highlighted the importance of facilitating the participation of older Australians in the online world through community education and assistance as a means of protecting both their human rights and their consumer rights.

To mark the fiftieth anniversary of President Kennedy’s statement to the United States Congress advocating for consumer rights, and to mark World Consumer Rights Day the ACCC hosted a consumer forum in Melbourne. The theme of the forum was ‘50 years of consumer rights—how far have we come’.

The forum allowed ACL regulators and consumer advocacy groups to reflect upon the operation of the ACL. The panel discussions at the forum covered a diverse range of topics including developing strategies to deal with issues faced by vulnerable consumers and engagement with government regulators.

During the quarter, the ACCC continued its work on raising awareness of scams in Australia. The Australasian Consumer Fraud Taskforce’s National Consumer Fraud Week ran from the 19 to 25 March and aimed to highlight scam delivery methods and educate Australians to ‘slam scams’ at the point of contact. The 2011 Targeting Scams Report was launched on 19 March 2012 to coincide with Fraud Week. The report compiles and analyses data gathered when consumers and small business contacted the ACCC to report scams or enquire about scam activity and is designed to raise awareness of scams and promote discussions on how the ACCC can best address the challenges posed by scams to the Australian community.

Important outcomes were also achieved in the ACCC’s consumer protection sphere. Following concerns that high concentrations of peroxides used in teeth whitener products resulted in gum and mouth chemical burns, the ACCC took action to notify suppliers that teeth whitening products containing high concentrations of peroxide should not be supplied to consumers. A compulsory recall of two unsafe DIY teeth whiteners was ordered by the Parliamentary Secretary to the Treasurer on 6 February 2012, after suppliers failed to remove the products from sale. The compulsory recall was the first under the ACL.

Major merger matters decided during the March 2012 quarter included:

• Caltex Australia Petroleum Pty Ltd proposed acquisition of capacity from terminals Pty Ltd as a new Port Adelaide fuel storage terminal
• Visy Industries Australia Pty Ltd proposed acquisition of PET and plastic assets of HP entities
• Amcor Limited proposed acquisition of the flexible packaging operations of Aperio Group Pty Ltd
• Google Inc proposed acquisition of Motorola Mobility Holdings Inc
• Johnson and Johnson proposed acquisition of Synthes Inc.

—the ACCC did not oppose the acquisition in the above matters.

In its adjudication role, the ACCC granted a final authorisation to Australian Processing Tomato Growers to collectively bargain on the terms and conditions of contracts with tomato processors for a period of five years.

During the quarter the ACCC made a decision relating to Telstra’s involvement in the wholesale and retail telecommunications markets. On 27 February 2012, the ACCC accepted Telstra’s structural separation undertaking (SSU) and approved its draft migration plan. Telstra submitted its SSU to the ACCC in accordance with the legislative framework established in November 2010. The undertaking implements a progressive form of structural separation through Telstra ceasing to use its own networks to provide services and agreeing to use the national broadband network (NBN) as it is rolled out. During the transition to the NBN, the SSU specifies a range of measures that promote equivalence and transparency in Telstra’s supply of fixed-line access services to wholesale customers and its retail business. These measures should benefit consumers by promoting competition in fixed-line telecommunications markets as the industry moves to the new wholesale-only network.

The ACCC completed its enquiry into the declaration of wholesale ADSL services. This declaration inquiry was initiated following complaints by access-seekers that a lack of regulated access to wholesale DSL services has impeded their ability to compete with Telstra. The ACCC considers that this will promote the long-term interests of end-users of fixed-line broadband internet services throughout Australia.

The ACCC released its annual Airport Monitoring Report for the 2010–11 financial year. This year’s report presented the monitoring results in relation to the airports’ supply of aeronautical and car parking services as well as outlining some options for the economic regulation of airports.

Other items in ACCCount 1 January to 31 March