The ACCC has released its 2018 enforcement priorities. Industries targeted should review their compliance strategies and think about how they would respond to a regulatory enquiry.

What do you need to know?

The ACCC has launched its compliance and enforcement policy for 2018. This year, the ACCC will be targeting a number of industries including financial services, energy, commercial construction, agriculture, new car retailing, broadband services, digital platforms, online retailing and franchising.

The ACCC will also focus on unfair contract terms, consumer guarantees, product safety, cartels, and the new prohibitions against misuse of market power and concerted practices.

Why does the ACCC have priorities?

Rod Sims, ACCC Chairman, has stated that "having priorities is vital. It signals externally, so that companies can look to address their conduct early, and it helps focus our activity".

Consumer issues in the ACCC's focus

Specific to consumer issues, the ACCC will be targeting:

  • consumer issues in new car retailing and matters identified in the ACCC's 2017 New Car Retailing Industry Report;
  • consumer issues in the provision of broadband services, including addressing misleading speed claims and statements made during the transition to the NBN;
  • systemic issues involving large or national traders avoiding or misrepresenting consumer guarantee rights;
  • issues arising from the Takata airbags recall; and
  • ensuring better product safety outcomes for consumers in the online marketplace.

To support smaller businesses, the ACCC will:

  • continue to place an emphasis on pursuing matters that involve substantial small business detriment, such as unfair contract terms; and
  • focus on Franchising Code of Conduct issues to ensure that small businesses receive the protections of industry codes.

Enduring priorities

Additionally, there are some forms of conduct that the ACCC considers to be so detrimental to consumer welfare and the competitive process that the ACCC considers them to be enduring priorities.

These include:

  • cartel conduct;
  • anticompetitive agreements and practices, and misuse of market power;
  • product safety issues which have the potential to cause serious harm to consumers; and
  • conduct impacting vulnerable and disadvantaged consumers.

Larger penalties

To ensure compliance with these priorities, the ACCC has signalled its support for higher penalties for businesses. Rod Sims stated, "put simply: large businesses should bear penalties which are commensurate to their size, in order to achieve specific and general deterrence. Making this happen is a huge priority and challenge for the ACCC in 2018."

Legislation is currently before Parliament which if passed will increase penalties for many breaches of the Australian Consumer Law. The maximum penalties will increase from AU$1.1 million for companies to the greater of:

  • AU$10 million;
  • three times the value of the benefit obtained by the conduct; or
  • 10% of the annual turnover of the company in the previous 12 month period.

This aligns the penalties for contraventions of the consumer law provisions in the Competition and Consumer Act with the competition law provisions.

What should businesses being targeted do?

Businesses in the ACCC's spotlight should assess their compliance with competition and consumer law and address any potential issues. Before responding to any regulatory enquiries, consider your overall strategy and any exposure to risk (including reputational risk), so that your response protects your long-term interests.

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