Australia: A world without borders: the ACCC focuses on online retailers in 2012

Last Updated: 21 April 2012
Article by Tanya Bunney and Abbey Richards

Most Read Contributor in Australia, September 2016

The ACCC's 2012 Objectives

On 20 February 2012 Rod Sims, the Chairman of the Australian Competition and Consumer Commission (ACCC), delivered a speech to the Australia-Israel Chamber of Commerce outlining the ACCC's objectives for 2012. According to Sims, "the online world will be front and centre of our focus in 2012."1 Specifically, he stated:

... we all know (the online world) ... is growing exponentially with some fascinating effects where, for example, established businesses with otherwise high entry barriers can now be challenged. We must ensure this can be done without established companies breaching the Act to protect themselves from competition from these new and emerging online players.

Sims alluded to the now well-established phenomenon of online business and the increasing difficulties associated with competition in markets that exist in both the traditional retail space and the online retail space. The rapid evolution of e-commerce has created seemingly limitless opportunities for online entrepreneurs who would otherwise not have the capital to acquire a physical retail store. But the rise of new players will challenge the dominance of the old, so consequently, the scope for competition has expanded, and with this increased competition has come a new wave of concerns regarding anti-competitive conduct.

The Legal Framework

In his speech, Sims does not say what action the ACCC might look to take to protect against anticompetitive conduct.

Part IV of the Competition and Consumer Act 2010 (Cth) (the CCA) prohibits various anti-competitive practices, but the ACCC's recent activities in the online retailing space seem to have focussed on s 48 of the CCA which prohibits a supplier from imposing a minimum resale price upon a reseller (resale price maintenance).2 While a supplier may recommend a minimum resale price for goods,3 to mandate that goods are not to be sold below a specified price constitutes resale price maintenance and is a breach of the CCA.

In one case, AquaDepot Imports (AquaDepot) admitted to engaging in resale price maintenance by stating to its retailers that if the company's aquarium products were sold at a price lower than 5–10 per cent below the recommended retail price then the company would cease to supply the retailer. When the online retailer ignored this pricing stipulation AquaDepot stopped supplying the retailer.4

Most recently, in January 2012 the ACCC commenced Federal Court proceedings against Eternal Beauty Products Pty Ltd alleging that it had attempted to force online retailers to sell Eternal Beauty products at a specified minimum price.5

Parties that engage in resale price maintenance can potentially attract large pecuniary penalties under s 76 of the CCA. In the case of a corporation the pecuniary penalty is capped at the greatest of the following: $10 million, 3 times the total value of the benefit the corporation obtained, or 10% of the corporation's annual turnover.6 In the case of an individual the pecuniary penalty is capped at $500,000.00,7 and the individual may be disqualified from managing a corporation.8 In addition, damages,9 injunctive remedies,10 and remedial orders11 are available.

Moreover, the ACCC has not been shy about utilising the full extent of s 76 and has secured penalties against infringing parties which range between $200,000.0012 to more than $1 million.13 In addition, it is not uncommon for infringing parties to be required to provide court-enforceable undertakings relating to things like corrective notices and trade practices compliance training.

Other provisions within Pt IV of the CCA which may be used by the ACCC in combating anti-competitive behaviour in the online retail space would include ss 46 (misuse of market power) and 47 (exclusive dealing).

The Productivity Commission

Online retailers claim that the ACCC's focus regarding resale price maintenance is imperative. In its submission to the Productivity Commission in June 2011, eBay alleged that there was "... evidence of suppliers and manufacturers attempting to stifle online retail through restrictive trade practices."14 The "explosive allegation" (as The Age called it)15 claimed that "certain unnamed Australian retailers had engaged in anticompetitive behaviour to limit the availability of products at online sites."Managing Director of eBay (Australia and New Zealand) Deborah Sharkey was quoted in the article as saying that "The highly concentrated Australian retail environment means that such behaviour can create considerable pressure on distributors and sellers, who have limited other retail distribution channels locally."

The Productivity Commission in its 2011 report entitled "Commonwealth, Economic Structure and Performance of the Australian Retail Industry" recognised that the behaviour described by eBay "may indicate anti-competitive conduct" and, consequently, referred eBay's submission to the ACCC.16 Presumably, this referral provided momentum for the ACCC's "front and centre" focus on the online world in 2012.

A Toothless Tiger?

Notwithstanding the ACCC's stated objectives, the pressing question is whether the ACCC will take a hard-line approach to anti-competitive behaviour in the context of the online space and how effective can it be, particularly given that online activity can be hard to investigate and it's relatively easy to "phoenix" online business.

Consequently, questions will no doubt be raised by business about the focus now being placed by the ACCC on anti-competitive behaviour in relation to online retailers. However, if the ACCC's previous approach, as indicated in the resale price maintenance cases and the penalties which have been imposed, is anything to go by, seemingly the ACCC will be enthusiastic in its defence of small online retailers in 2012.

Notwithstanding the enthusiasm with which the ACCC may approach the matter, the applicability of the CCA provisions becomes inherently more complicated in the online world due to jurisdictional issues (i.e. to what extent, if any, does the CCA apply to overseas traders?). Sections 5(1) and 5(2) of the CCA provide for this, in part, by extending the application of Pt IV of the Act to conduct engaged in outside of Australia if the party engaging in the conduct is "carrying on business within Australia." In fact, the courts have interpreted this phrase to specifically include internet businesses based overseas but which can be accessed by consumers in Australia.17

However, whether the CCA applies and whether its provisions are enforceable are two different questions. The principle that "the courts of one country will not enforce the penal... laws of another"18 complicates the enforceability of the CCA in respect to online commerce. Nonetheless, the ACCC does appear to have strong associations with corresponding international regulators and has, in fact, had some success in enforcing action against overseas-based traders.19 On this basis, despite the obvious difficulties associated with ACCC prosecutions of overseas online retailers, it appears that such prosecutions might have more bite than one would expect.

The New World

The "threat" of online competition is no longer a concern of the future—online competition is now a fact of life. While competition is unquestionably beneficial for consumers and indeed, necessary for business development as a whole, it also invites aggressive anticompetitive behaviour. While it is yet to be seen whether the ACCC will take a forceful approach to online anti-competitive behaviour, given the continuous expansion of retail online, it is difficult to see how such an issue could not be given primacy by the ACCC for some years to come.


1 Rod Sims, "Enduring Perspectives and 2012 Objectives" (Speech delivered at the Australia-Israel Chamber of Commerce Conference, Melbourne, 20 February 2012), 6.
2See further Pt VIII of the Competition and Consumer Act 2010 (Cth).
3Section 97 of the Competition and Consumer Act 2010 (Cth).
4Following an investigation by the ACCC, Graeme Faulkner and Philip Wu, trading as AquaDepot Imports, provided a court enforceable undertaking to the ACCC which provided that AquaDepot would, among other things, send a letter to retailers informing them that they are free to set retail prices for AquaDepot products, place a corrective notice on the AquaDepot website, and attend trade practices compliance training annually for three years.
5The matter has been filed in the Federal Court of Australia's Fast Track List in Melbourne. Orders were made on 20March 2012 which, among other things, set down a two day trial commencing on 12 June 2012.
6Section 76(1A)(b) of the Competition and Consumer Act 2010 (Cth).
7Section 76(1B)(b) of the Competition and Consumer Act 2010 (Cth).
8Section 86E of the Competition and Consumer Act 2010 (Cth).
9Section 82 of the Competition and Consumer Act 2010 (Cth).
10Section 80 of the Competition and Consumer Act 2010 (Cth).
11Section 87 of the Competition and Consumer Act 2010 (Cth).
12Australian Competition and Consumer Commission (ACCC) v Telwater Pty Ltd [2009] FCA 263; BC200901829.
13Australian Competition and Consumer Commission (ACCC) v Chaste Corp Pty Ltd (in liq) [2005] FCA 1212; BC200506448.
14The Allen Consulting Group (on behalf of eBay), Submission No 101 to the Commonwealth Government, Economic Structure and Performance of the Australian Retail Industry, Productivity Commission Inquiry Report, June 2011, vi.
15Eli Greenblat, "Big retailers bullying online stores, claims eBay", The Age (online), 5 September 2011, .
16Commonwealth, Economic Structure and Performance of the Australian Retail Industry, Productivity Commission Inquiry Report (2011) No 56, 151.
17See for example, Australian Competition and Consumer Commission v Hughes (2002) ATPR 41-863; [2002] FCA 270; BC200200884.
18Australian Competition and Consumer Commission (ACCC) v Yellow Page Marketing BV (No 2) (2011) 195 FCR 1; [2011] FCA 352; BC201102241 at 77.
19See the discussion of enforcing Australian laws in foreign jurisdictions and the ACCC's engagement with overseas regulators in Ch 5: "Consumer Protection" in Commonwealth, Economic Structure and Performance of the Australian Retail Industry, Productivity Commission Inquiry Report (2011) No 56, 151.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.