At present the ACCC has no power to issue 'infringement notices' – sometimes called 'on the spot fines' – to wrongdoers and must instead apply to the courts for pecuniary penalties to be imposed. Petrol retailers may be the first to experience a new ACCC power to issue "fines", in the form of infringement notices, if the Fuelwatch legislation (the National Fuelwatch (Empowering Consumers) Bill 2008 and the National Fuelwatch (Empowering Consumers) (Consequential Amendments) Bill 2008 - currently caught up in the Senate) is passed.

Under the proposed Fuelwatch legislation, which is modelled on a regime currently in place in Western Australia, petrol retailers must inform the ACCC by 2pm each day of the price at which they will sell each type of fuel offered by them during the next day. The petrol retailers must sell at the notified prices, commencing at 6am the next day, for a 24 hour period. The ACCC will maintain a website publishing daily fuel prices for consumers to refer to.

Under the proposed Fuelwatch legislation, if the ACCC has reasonable grounds to suspect that a petrol retailer has failed to:

  • notify the ACCC of certain prescribed details, including the retailer's name, ABN, service station location and kinds of fuel to be offered for sale
  • notify the ACCC of the next day's price for petrol, or
  • sell fuel at the notified price

it may issue an infringement notice to the retailer. The infringement notice will inform the retailer that if it pays a penalty ($550 in the case of an individual and $2,750 in the case of a body corporate) within 28 days, civil penalty proceedings in the Federal Court will not be brought in relation to the matter. Civil penalty proceedings carry potential penalties of up to $22,000 in the case of an individual and $110,000 in the case of a body corporate. (It should be noted that under the proposed legislation it is open to the ACCC to move straight to civil penalty proceedings. There is no requirement to first issue an infringement notice.)

It is far from certain that a national Fuelwatch scheme, and along with it, ACCC power to issue infringement notices, is going to become a reality. The fate of the legislation appears to be in the hands of key independent Senators, with whom the Government is currently negotiating.

Yet, Fuelwatch aside, there are other signs that infringement notices will eventually join the cache of enforcement tools available to the ACCC.

For one thing, on 30 April 2008 the Productivity Commission published its final report, Review of Australia's Consumer Policy Framework, which included a recommendation that infringement notices (along with civil pecuniary penalties, banning orders and substantiation notices) be added to the enforcement tools currently in the Trade Practices Act 1974 (TPA). This recommendation was made notwithstanding the fact that the ACCC had not argued in favour of the introduction of infringement notices in its lengthy submission to the Productivity Commission inquiry (ACCC December 2005 Submission in response to the Ministerial Council on Consumer Affairs' discussion paper Civil Penalties for Australia's Consumer Protection Provisions). In its report, the Productivity Commission noted that infringement notices are already a feature of some State and Territory fair trading acts.

More recently, the ACCC itself has recommended that the TPA be amended to introduce infringement notices (along with civil pecuniary penalties) for breaches of a mandatory industry code made under Part IVB, citing for support of the views the Productivity Commission expressed in favour of infringement notices in the Productivity Commission's final report. The ACCC made the recommendation to include an ACCC power to give infringement notices in the TPA as part of its review of the Horticulture Code that appears in the grocery inquiry report published by the ACCC on 5 August 2008 (see our summary of the Grocery Report here). Interestingly the ACCC's recommendation for infringement notice powers is not confined to the Horticulture Code, but seems to extend to other mandatory industry codes made under Part IVB such as the Franchising Code of Conduct and the Oilcode. The introduction of such laws will attract a significant degree of attention, particularly in the franchising sector, where, for example, a minor omission from a franchise disclosure document might see a company fined for breaching the Franchising Code. We will continue to provide updates with any developments in this area.

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