ACCC Chairman addresses supermarket debate

Posted by AFN Staff Writers on 30th October 2013

Australian Competition and Consumer Commission Chairman Rod Sims today provided a regulator’s perspective on the debate surrounding the market share held by the two major supermarket chains in Australia. Mr Sims spoke at the Australian Food and Grocery Council’s (AFGC) industry forum in Canberra.

“At the ACCC, we are completely clear that our role is only to protect the competitive process, and this is how we see the current debate,” Mr Sims said. “It is simply incorrect to label all those who question aspects of the degree of market power of the major supermarket chains as people wanting to protect inefficient businesses,” he said.

“Second, we see the supermarket issues capable of being dealt with under the Competition and Consumer Act, and we do not see use of the Act as excessive regulation,” Mr Sims said. “Indeed, effective implementation of the Act is vital for the success of our market economy. It provides clear and wide boundaries within which we can all benefit from the power of the profit motive,” he said.

Mr Sims argued that it was incorrect to say that a market economy needed no regulation.

“It requires a modest amount of appropriate regulation to be effective, and this is what the Act provides,” Mr Sim said.

In outlining supermarket issues that fit under the Act, the Chairman provided and update and perspectives on supplier issues, the proposed code of conduct, shopper dockets, credence claims, mergers and safety issues.

Mr Sims also explained the ACCC’s enforcement role and how it must always act on the basis of facts and evidence in taking court action.

“Our enforcement role, therefore, is not to be a decision maker,” Mr Sims said. “This is for the courts, which are, of course, the ultimate umpire, as they should be,” he said.

Shopper dockets investigation

Mr Sims said the ACCC has no power to ban shopper dockets, and nor did it want the power to ban promotions.

“Take our shopper docket investigation as an example where the ACCC’s role as an enforcement agency has been sometimes misunderstood,” Mr Sims said. “As an enforcement body, the ACCC can investigate market activity and, where appropriate, take court action seeking injunctions to stop conduct and seek penalties in appropriate cases,” he said.

Mr Sims also welcome the ‘root and branch’ view of Australia’s competition laws as an “important opportunity” to ensure the laws were appropriate and served to enhance the welfare of Australians.

Upcoming FoodLegal Symposim on supermarket-supplier relationships

The Australian Competition and Consumer Commission (ACCC) is investigating the relationships between Australia’s major supermarkets and suppliers. What have they been investigating? What are potential commercial conflict areas between suppliers and supermarkets? When can suppliers and retailers be viewed as competitors?

Coles General Manager of Corporate Affairs, Mr Robert Hadler, will seek to present the case for suppliers to trust his Coles group at FoodLegal’s Afternoon Symposium on 12 November 2013.

Coles’ Robert Hadler will be matched by one of Australia’s leading competition law experts Dr Alexandra Merrett and Australian grocery industry regulatory representative, Dr Geoffrey Annison.

Other speakers from industry include Martin Kneebone with expertise as a food market analyst specialising in fresh foods, Dr Andrew Monk, a leader and key player in Australia’s organic food category, and well-known patent attorney Adam Hyland whose expertise strengthens several leading Australian and international food brands. The speakers will discuss protections vis a vis the major supermarkets. For more information and registration, click here.