Tuesday, May 28, 2024

Section 46 to give small businesses a level playing field

Section 46 of the Competition and Consumer Act 2010 – the misuse-of-market-power provision – has been amended by the federal government to align with the recommendations of the 2016 Harper policy review

“The Harper review found the misuse-of-market-power law was not reliably enforceable and did not effectively target and deter anti-competitive conduct,” Treasurer Scott Morrison said.

“The reforms represent a pivotal step towards ensuring Australia’s competition laws are fit for purpose and support competition in a dynamic economy.

“The new section 46 is robust law that will prevent firms with substantial market power engaging in conduct that harms competition in Australian markets. This is particularly important for Australia’s 3.2 million small businesses which make up more than 97 per cent of all businesses.”

Minister for Small Business Michael McCormack said the amendments would lead to much fairer conditions for independent retailers.

“The passage of section 46 is another bill that backs small business and delivers on the Liberals and Nationals’ election promise,” he said.

“Protecting small business from anti-competitive conduct was a key recommendation of the Harper review. The new section 46, delivered by the government, empowers the consumer watchdog to look at the actual or likely impact of conduct on a market.

“It also further strengthens laws to prevent firms with substantial market power engaging in conduct that harms competition in Australian markets.

“From farmers to small supermarkets, from consumers to suppliers, many Australians tell me how these changes will stop firms with substantial market power from engaging in conduct which reduces competition.

“This is good news for small businesses that want to compete and good news for consumers who want competition in the market.”

Master Grocers Australia CEO Jos de Bruin said: “This is a great triumph for our independent retailers who have struggled for years against stifling, unfair competition laws. At last we will have a level playing field.

“While the entire Senate was not supportive of the proposed change to the law, a significant number of Senators fortunately expressed the urgency of cracking down on stifling anti-competitive behaviour. They referred to the need to suppress the abuse and misuse of market power that has prevailed, to the detriment of smaller players, for decades.

“Small businesses were described as the ones who can make a major contribution to the growth of our economy, but only if they were free to compete with their bigger rivals on level turf. It was essential for the Senate to remove the restrictive laws that were holding back innovation and growth, and to provide the opportunity that would allow small businesses to compete on their merits.”

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