ACCC authorisations allow businesses to cooperate during COVID-19

The Australian Competition and Consumer Commission (ACCC) has taken measures to help consumers and businesses during COVID-19. One of these measures has been to increase the granting of interim and final authorisations to allow collaboration between competitors that might otherwise raise concerns under the competition provisions of the Competition and Consumer Act 2010 (Cth) (Competition and Consumer Act).

Businesses that are concerned that their proposed conduct may give rise to a breach of the Competition and Consumer Act may seek authorisation from the ACCC. An authorisation is a legal exemption that can be sought from the ACCC where the proposed conduct would or might:

  • breach a cartel provision (Division 1 of Part IV);
  • have the purpose or effect of substantially lessening competition (s. 45); and/or
  • involve exclusive dealing (s. 47).

Broadly speaking, the ACCC may grant an authorisation to provide statutory protection from court action when it is satisfied that the public benefit from the anti-competitive conduct will outweigh any public detriment.

Public benefit vs public detriment

When considering applications for authorisation during the COVID-19 pandemic, the ACCC acknowledges that it may be in the public interest to allow temporary anti-competitive conduct to lessen the negative impact of COVID-19 and assist in the return to competitive conditions when the pandemic subsides. The ACCC generally considers public detriment to be minimal in the context of the pandemic where the proposed conduct is a temporary measure and is not intended to provide a permanent restriction on competition.

Examples of authorisations during the pandemic

Many of the authorisations granted during COVID-19 have been in the health care sector. The ACCC has granted interim authorisations for private healthcare facilities and public hospitals in all states and territories to coordinate to ensure an efficient and effective allocation of hospital resources and services. The authorisations include allowing public and private facilities to jointly procure and distribute medical equipment and supplies, and share staff between facilities. Without the ACCC authorisation, this type of conduct would risk breaching the Competition and Consumer Act.

Other examples of ACCC interim authorisations during COVID-19 include:

  • airlines coordinating flight schedules and sharing revenue between carriers to maintain a viable service;
  • supermarkets cooperating on grocery supply to ensure continued supply of food;
  • electricity and gas companies cooperating to provide financial relief to residential and business customers financially impacted by COVID-19;
  • franchisees cooperating to discuss potential temporary store closures or reduced trading hours due to reduced customer demand; and
  • retailers collectively negotiating with landlords about rent relief.

The interim authorisations are generally subject to reporting conditions which allow the ACCC to closely monitor the proposed conduct.

More information

If you have any queries or would like further information about this article, please contact:

Kathryn Speed
Principal
M: 0408 446 013
E: kspeed@pageseager.com.au

Ella Wade
Lawyer
T: (03) 6235 5161
E: ewade@pageseager.com.au

Published: 26 August 2020

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