Understanding Fair Trading, Consumer Protection, and Competition Laws in Australia, Slides of Law

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INTRODUCTION Fair trading, consumer protection and competition (trade practices) legislation • Power to make these laws • What do these terms mean? • How are they relevant to the information age? • What are the main laws (Statutes/Acts) - Trade Practices Act 1974 (Commonwealth) - Fair Trading Acts (States and Territories) • Why have Commonwealth AND State Acts? • Telecommunications specific legislation Docsity.com Fair Trading Acts • Fair trading legislation in all States and Territories have a common purpose to make uniform laws that strengthen consumer protection laws and mirror the consumer protection provisions of the TPA. • Fair Trading legislation empowers the Governor in Council to make regulations generally for the purpose of the Act. • Ministers and Commissioners also have specific powers under the Acts (e.g in NSW and WA, Ministers have powers with regard to Codes of Practice; Commissioners in approving Codes of Practice, product safety declarations etc.) Docsity.com Part IVA – Unconscionable Conduct • TPA prohibits ‘unconscionable conduct’ in commercial dealings (ss51AA and 51AC) and consumer transactions (s51AB). Section 51AA is the catch all. Section 51AC is limited to transactions up to $3million. • ‘Unconscionable conduct’ not defined in the Act. Section 51AC lists factors which may be taken into account. • Penalties amended in 2001 to include probation and community service orders, corrective ads etc. • Definition/concept of ‘unconscionable’ • Weighing up the conduct – ‘special disability’ of one party resulting in an absence of equality that is exploited by the other party in a manner which is unconscionable. - Lux vacuum cleaner salesperson (door to door); - One.Tel and Primus slamming case (door to door); - Pre-paid mobile phone cards (products and distributorships/franchises) - Contractual terms and conditions (the inability of the consumer to understand the documentation signed AND contractual non-disclosure). Docsity.com Part IV – Anti-competitive conduct • Price Fixing s45A • Market sharing s45 • Exclusionary Provisions ss45 and 4D • Anti-competitive agreements s45 with SLC • Exclusive dealing s47 • Third Line Forcing s47(6) • Resale Price Maintenance ss48, 96-100 • Misuse of Market Power s46 Docsity.com Part IV – Anti-competitive conduct • Mergers and Acquisitions ss50, 50A Factors to take into account in evaluating the effect or likely effect of a particular acquisition:  The actual or potential level of import competition in the market;  The height of barriers to entry to the market;  The level of concentration in the market;  The degree of countervailing power in the market;  The likelihood the acquisition would result in increased in prices or profit margins;  The extent to which substitutes are available in the market;  The dynamic characteristics of the market (growth, innovation, product differentiation);  The likelihood the acquisition would result in the removal of a vigorous competitor; and  The nature and extent of vertical integration of the market. Docsity.com Part V – Consumer Protection • Misleading or deceptive conduct ss51A, 52 -65A (including misleading/false representations, harassment & coercion, scams, pyramid schemes etc.) • Product safety and product information ss65B-65T (labelling, standards, bans and recalls) • Country of origin claims ss65AA-65AN (logos and ‘product of’ tests); • Conditions and warranties in consumer transactions ss66-74 (including rights against manufacturers or importers (ss74A-74L) and professional services by engineers). Penalties of $1.1 million for corporations and $220,000 for individuals. Also injunctions, damages, orders, etc. Docsity.com Part V Division 1: Unfair Practices • General prohibition against misleading or deceptive conduct or conduct likely to mislead or deceive (including representations made in advertising, contractual promises, telemarketing, customers services, etc.) • S51A – representations about the happening of future events without reasonable grounds; • S53 – false or misleading information; • S53C – not specifying the full cash price (e.g Mobile phone and contract price) • S54 – falsely offering prizes or other free items Docsity.com Part V Division 1: Unfair Practices • S55, 55A – misleading the public as to the nature or characteristics of goods and services, the suitability for their purpose or quantity of services • S56 - bait advertising • S57 – referral selling (rebate/commission/benefit for suggesting other customers) • S58 – accepting payment without intending to supply • S60 - harassment or coercion • S64, 65 – unsolicited goods or services • Publisher of misleading advertising exempt (s65A) as a ‘prescribed information provider’. Docsity.com Part VC – Offences • Effective 15 December 2001; • Part VC establishes a separate criminal consumer protection regime within the TPA applying to criminal unfair practices and product safety provisions. • Defences such as mistake and relying on information of a third party etc, Part VI – Enforcement and Remedies • Ss75B-87CA – includes provisions catching persons aiding, abetting, counselling or procuring an offence. Also those ‘knowingly concerned’. Docsity.com Part XIC and XIB TPA • Telecommunications specific sections of the TPA introduced in 1997 along with a new Telecommunications Act. • Specific access provisions for telecommunications networks separate from Part IIIA essential facilities access regime in TPA • Competition notice regime to deal with anti- competitive conduct in telecommunications markets Docsity.com Emerging regulatory issues in telecommunications • Telstra’s High Court challenge of ACCC regulation • 3G Mobile coverage • Mobile termination costs • Broadband services Docsity.com