Australia: Competition & Consumer Law - Whats News - 1 March 2017

In the media

ACCC names key enforcement and compliance priorities for 2017
The Chairman of the Australian Competition and Consumer Commission Rod Sims says 2017 will see its enforcement teams hone in on misleading and deceptive practices, anti-competitive conduct and unfair contract terms affecting small businesses (24 February 2017). More...

Health insurers face legal action for consumer rip-offs
Australia's consumer watchdog plans to take legal action against more private health insurers this year, saying many patients are being slugged with unexpected hefty bills after hospital visits (23 February 2017). More...

ACCC releases Statement of Issues on South32 Ltd's proposed acquisition of Metropolitan Collieries
The ACCC has issued a Statement of Issues on the proposed acquisition by South32 of Metropolitan Collieries, currently owned by Peabody Energy. The ACCC is concerned that the proposed acquisition may substantially lessen competition in the supply of coking coal to Australian steelmakers (23 February 2017). More...

Competition and Consumer Amendment (Misuse of Market Power) Bill 2016: Senate Committee Reports
The Senate Standing Committee on Economics (the SSCE) has delivered its report on the Competition and Consumer Amendment (Misuse of Market Power) Bill 2016 (Cth) (the Bill) on 16 Feb 2017. The Bill seeks to implement the reforms to the Competition and Consumer Act 2010 (Cth) (CCA) recommended by the Harper Review of competition policy (23 February 2017). More...

Petrol prices were the highest in more than a year in December quarter
The ACCC's ninth quarterly report on the Australian petroleum industry has found that the December quarter 2016 had the highest quarterly average price since the June quarter 2015. International crude oil and refined petrol prices increased because of the OPEC cartel's decision to restrict oil supply. Cartel conduct leads to higher prices and economic harm and, in this case, it has meant higher prices at the pump for Australian motorists, Mr Sims said (22 February 2017). More...

Lumo energy pays penalty of $10,800 for representations about retail gas tariff increase
Energy retailer Lumo Energy Australia Pty Ltd (Lumo) has paid a penalty of $10,800 following the issue of an infringement notice by the ACCC. The ACCC issued the infringement notice because it had reasonable grounds to believe that Lumo had contravened the Australian Consumer Law (ACL) by making a false or misleading representation with respect to the price of its retail gas tariff (20 February 2017). More...

REA Group Limited v Fairfax Media Limited [2017] FCA 91: False and Misleading Conduct
A Federal Court in Melbourne has ruled in favour of Fairfax Media in the majority of contended issues in the case of REA Group Limited v Fairfax Media Limited [2017] FCA 91. Fairfax Media's subsidiary Domain's series of advertisement were contested by REA Group for false and misleading and deceptive conduct in relation to the claims the ads made. Out of the seven contended ads, the Federal Court ruled that only two constituted misleading or deceptive conduct (15 February 2017). View the decision here.

In practice and courts, published reports

ACCC review of Healthe Care's proposal to buy Pulse Health, including the Forster Private Hospital
Healthe Care is planning to buy Pulse Health who owns 12 healthcare facilities in Australia – five in NSW, four in Queensland, and three in Victoria. The ACCC is considering whether this deal will reduce competition for health care services, particularly in the Forster/Great Lakes and Taree/Manning areas of NSW.

ACCC Dairy Inquiry
The ACCC is holding public inquiries in relation to the Dairy Inquiry from 6 February to 22 March 2017. It has been reported that up to 330 dairy farmers have given evidence in the first two days of ACCC hearings in Queensland and NSW.

Cases

Zreika v Client Management Systems Australia Pty Ltd [2017] FCCA 169
CONSUMER LAW – Whether the Respondent contravened s.18 of Schedule 2 – Australian Consumer Law, to the Competition and Consumer Act 2010 because it engaged in misleading and deceptive conduct – common law claim of negligence – application dismissed.

Ebbsfleet Pty Ltd as trustee for Ebbsfleet Superannuation Fund v Semantic Software Asia Pacific Ltd (No 3) [2017] NSWSC 78
Plaintiffs entitled to damages for breach of warranty that shares in first defendant would triple in value within two years of issue and by damage suffered by reliance on representation to same effect made without reasonable grounds and thus misleading.
CONTRACT – Share Issue Agreements – warranty that subscribed shares in first defendant would triple in value in two years – proper construction of the agreements – whether they specify exclusive remedy in event shares did not triple in value – whether shares did triple in value – value of patents owned by wholly owned subsidiary of first defendant; INTELLECTUAL PROPERTY – value of such patents; MISLEADING OR DECEPTIVE CONDUCT – admitted representation that shares would triple in value in two years – whether defendants had reasonable grounds to make representation.

Gore v Australian Securities and Investments Commission [2017] FCAFC 13
CORPORATIONS – Corporations Act 2001 (Cth) – accessorial liability – prohibition on offering securities under s 727(1) and (2) without disclosure document being lodged if disclosure required under Pt 6D.2 – whether alleged accessory without actual knowledge that offer required disclosure capable of being found to be knowingly concerned in principal's contraventions of s 727(1) and (2) – elements of accessory's contravention of s 727(1) and (2) – whether necessary for party alleging contravention to prove that no exemption from requirement of disclosure applies to the offer of securities.
CORPORATIONS – Corporations Act 2001 (Cth) – accessorial liability – where civil and criminal penalties apply to offences under s 727 – where offence of contravening s 727(1) and (2) created by s 1311(1) – where s 1308A of Corporations Act 2001 (Cth) applied provisions of Criminal Code (Cth) to offences under Act – whether Pt 2.4 of Criminal Code (Cth) required proof of physical and fault elements in respect of contravention of s 727(1) and (2) – proof of physical and fault elements under the Criminal Code (Cth) necessary to establish accessory's contravention of s 727(1) and (2).
CORPORATIONS – accessorial liability for misleading or deceptive conduct under s 1041H of the Corporations Act 2001 (Cth) and s 12DA of the Australian Securities and Investments Commission Act 2001 (Cth) – elements of an accessory's contravention of s 1041H and s 12DA – whether accessory had actual knowledge that disclosure document made representation that was misleading or deceptive or likely to mislead or deceive.

Legislation - Commonwealth

Competition and Consumer Legislation Amendment (Small Business Access to Justice) Bill 2017
Registered 16/02/2017; Introduced Senate 16/02/2017 - This Private Senators' Bill amends two acts, the Competition and Consumer Act 2010 and the Australian Small Business and Family Enterprise Ombudsman Act 2015. It allows judges in the Federal Court to waive liability for adverse costs to small business private litigants in cases related to the misuse of market power. It also allows the Small Business and Family Enterprise Ombudsman to provide assistance to small businesses in preparing these cases.

Current Inquiries

Corporations Amendment (Crowd-sourced Funding) Bill 2016 [Provisions]
Status: Accepting Submissions Date Referred: 01 December 2016 Reporting Date: 13 February 2017. See the released report here.

Senate Economics Committee receiving submissions on MMP bill
The Competition and Consumer Amendment (Misuse of Market Power) Bill 2016 was referred to the Senate Economics Committee on 1 December 2016.
The Committee reported on 16 February with the majority recommending passage of the bill subject to some modification. The three recommendations made were:
Recommendation 1: The committee recommends that the proposed mandatory factors, as drafted in subsection 46(2) of the bill, be removed.
Recommendation 2: The committee recommends that the government undertake a post-implementation review of the reforms to section 46 at least five years after commencement.
Recommendation 3: The committee recommends that the bill be passed.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

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Authors
Ian Robertson
 
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