Category: MIL-OSI

Source: Australian Ministers for Regional Development

The ACCC has launched Federal Court proceedings against technology company Swift Networks Pty Ltd (Swift) for alleged bid rigging and price fixing when tendering to supply equipment and services to five Pilbara mining village sites.

The ACCC alleges that on five occasions in 2019, Swift made an agreement with a competitor, DXC Connect Pty Ltd and DXC Technology Australia Pty Ltd (together DXC), to rig bids and fix prices for the supply of technology infrastructure at mining camps in WA’s Pilbara region.

Technology infrastructure includes IT, communications, and audio-visual entertainment infrastructure and associated services for providing internet and media services such as free-to-air or subscription television to mining villages

The tenders were for projects located at Rio Tinto Limited’s Gudai-Darri, West Angelas and Yandicoogina, Western Turner Syncline, and Peninsula Palms sites, and at Fortescue Metals Group Limited’s Japal Village Iron Bridge site. For these five projects, it is alleged Swift and DXC agreed that one of them would submit a higher price than the other in response to a request for bids.

Since late 2017, Swift and DXC sometimes engaged each other as sub-contractors for projects involving the supply of Technology Instructure to mining sites in the Pilbara. However, in the case of the five projects, the ACCC alleges Swift and DXC acted beyond the scope of any sub-contracting relationship.

“Bid rigging and price fixing drive up prices for businesses and harms the economy, which is why cartel conduct is a serious breach of our competition laws,” ACCC Commissioner Liza Carver said.

“This case is a reminder to all businesses, large or small, that they must exercise caution when they are dealing with competitors to ensure that these discussions do not lead to anti-competitive arrangements, including cartel conduct.”

The ACCC is seeking declarations, penalties, costs and other orders.

Background

Swift is a specialist technology company delivering technology infrastructure, entertainment and communications to the mining and resources, aged care, and hospitality industries.

DXC is a global information technology services provider across a range of industries. It supplies “technology infrastructure” in the mining sector in Western Australia.

Notes to editors

Bid rigging, also known as collusive tendering, happens when suppliers discuss and agree among themselves who should win a tender, and at what price.

Price fixing happens when competitors agree on pricing instead of competing against each other.

More information about different types of cartel conduct can be found on the ACCC’s website at Cartels.

The ACCC investigates cartel conduct and can take civil cartel proceedings in the Federal Court or refer serious cartel conduct to the Commonwealth Director of Public Prosecutions (CDPP).

The ACCC works to detect cartels including through education programs, proactive intelligence gathering and data assessment and working with overseas counterparts to identify cartels that operate on a global level.

The ACCC also manages an immunity program that enables past or present cartel members to confess their actions and cooperate with investigations in exchange for immunity from civil cartel proceedings brought by the ACCC and criminal cartel charges laid by the CDPP.

Anyone who thinks they may be involved in cartel conduct is urged to call the ACCC Cartel Immunity Hotline on (02) 9230 3894. More information about the immunity process is available on the ACCC website at Cartels.

You can also report cartel conduct by using the anonymous cartel portal.

Public procurement officials who want to know more about detecting cartels are encouraged to contact the ACCC Cartel Outreach team at carteloutreach@accc.gov.au.

Source: Australian Ministers for Regional Development

The ACCC will not oppose Endeavour Group Limited’s proposed acquisition of the Beachfront Hotel in Rapid Creek, just north of Darwin.

The Beachfront Hotel includes a hotel and an independent liquor store trading under the ‘Cellarbrations’ brand. Endeavour already operates a number of hotels and BWS stores in the local area.

“The ACCC looks closely at acquisitions that result in consolidation in local markets

and initially identified concerns with this proposed acquisition,” ACCC Acting Chair Mick Keogh said.

In relation to the supply of takeaway liquor in the local area around the Beachfront, the ACCC ultimately concluded that a sufficient variety of liquor stores would remain in the area post-acquisition.

“Consumers in the local area would continue to have access to two Coles’ Liquorlands and a variety of other liquor stores, operating under a range of banners including Cellarbrations, Thirsty Camel and Bottlemart,” Mr Keogh said.

Overall, three owners of large liquor stores and 11 independently owned small liquor stores would remain in the 5km area of the Beachfront hotel.

“The ACCC will continue to look closely at consolidation in local markets. It is important that local consumers benefit from competition between different stores with different promotions, pricing, ranges and service offerings,” Mr Keogh said.

The ACCC also considered the supply of on-premises services at the Beachfront Hotel but came to the view that Endeavour would continue to face competition from a number of alternative liquor, food and gaming providers after the acquisition.

The ACCC also concluded that the proposed acquisition is unlikely to materially affect the competitiveness of other independent liquor stores in Darwin.

In particular, the ACCC considers that removing the Beachfront Hotel liquor store from the Cellarbrations banner network, and removing it as a wholesale customer of Metcash-owned Australian Liquor Marketers (ALM), would not significantly impact the efficiency and competitiveness of other stores under the Cellarbrations banner, or those who are wholesale customers of ALM.

Background

Endeavour (ASX:EDV) is a major Australian alcoholic drinks retailer and hotel operator that operates a portfolio of brands including BWS, Dan Murphy’s, Jimmy Brings, Shorty’s Liquor and Langton’s.

Endeavour also manages over 330 licensed hotels across Australia, through its subsidiary, ALH Hotels. Endeavour operates several liquor stores (including BWS Nightcliff and BWS Casuarina) and hotels (including Airport Tavern) near Beachfront Hotel.

The Beachfront Hotel is located in Rapid Creek, NT. It is currently owned by companies ultimately controlled by local businessperson Doug Sallis. It sits on a block of 7,500 sqm and includes a bistro offering on-site food and beverage, a public sports bar (with TAB), 20 gaming machines, and a drive-through liquor store. The liquor store has a trading area of approximately 270 sqm and currently operates under the Cellarbrations brand.

Source: Australian Ministers for Regional Development

The Full Federal Court has dismissed an appeal by the ACCC in its proceedings against NSW Ports.

The ACCC’s proceedings were brought against NSW Ports Operations Hold Co Pty Ltd and its subsidiaries Port Botany Operations Pty Ltd and Port Kembla Operations Pty Ltd (together, NSW Ports). NSW Ports operates Port Botany and Port Kembla.

The ACCC had alleged that agreements entered into by NSW Ports at the time the State of NSW privatised the Ports of Botany and Kembla were anti-competitive.

The agreements, known as the Port Commitment Deeds, oblige the State of NSW to compensate the operators of Port Botany and Port Kembla if container traffic at the Port of Newcastle is above a minimal specified cap. The Port Commitment Deeds were entered into in 2013, for a term of 50 years.

Another 50-year deed, signed in May 2014 when the Port of Newcastle was privatised, requires the Port of Newcastle to reimburse the State of NSW for any compensation paid to operators of Port Botany and Port Kembla under the Botany and Kembla Port Commitment Deeds. This reimbursement would significantly increase the cost of moving a container at the Port of Newcastle.

The Full Court dismissed the ACCC’s appeal against the trial judge’s findings that NSW Ports had ‘derivative crown immunity’ and that the ACCC had not established that the purpose and likely effect of the compensation provisions was anti-competitive.

“We originally took this action because we were concerned that under the Port Commitment Deeds NSW Ports has an effective monopoly in container port services in NSW for 50 years,” ACCC Commissioner Liza Carver said.

“We appealed this case because we considered that the compensation provisions created a significant barrier to entry. The threat of new entry is an important part of the competitive process, and imposes a competitive discipline on existing businesses, including monopolies.”

At this stage the judgment has been made available only to the parties’ lawyers, on a restricted basis, pending resolution of confidentiality issues. Accordingly, the ACCC cannot yet discuss the reasons for the decision.

Since the appeal was heard, the NSW Parliament has passed legislation establishing a process for extinguishing the liability of the Port of Newcastle to reimburse the State for any compensation paid to the operators of Port Botany and Port Kembla. The Port of Newcastle (Extinguishment of Liability) Act 2022 (NSW) came into effect on 25 November 2022.

The passage of the legislation should facilitate competition between ports in NSW for the provision of container port services. 

Background

Crown immunity protects state governments from the operation of competition laws when they are not carrying on a business. When this immunity extends to parties that contract with state governments in certain limited circumstances, it is known as ‘derivative crown immunity’.

In December 2018, the ACCC instituted proceedings against NSW Ports. In 2019, NSW Ports made a cross claim against the State of New South Wales and the Port of Newcastle entities, joining them to the ACCC’s proceedings.

In June 2021, the Federal Court dismissed the ACCC proceedings against NSW Ports.

In July 2021, the ACCC lodged an appeal against the Federal Court’s decision to dismiss the ACCC’s proceedings against NSW Ports.

NSW Ports operates Port Botany and Port Kembla under 99-year leases from the State of NSW.

The compensation to be paid by the State of New South Wales under the Port Commitment Deeds to the operators of Port Botany and Port Kembla is equivalent to the wharfage fee the port operators would receive if they handled the containers.

Source: Australian Ministers for Regional Development

The ACCC has granted interim authorisation to Qantas Airways Ltd (ASX:QAN) and Jetstar Airways Pty Ltd for the continued coordination of two Jetstar Asian-based joint ventures and, in certain circumstances between Jetstar Japan and Japan Airlines.

At the same time, the ACCC issued a draft determination proposing to grant final authorisation to the arrangements for a period of 5 years rather than the 10 years applied for and is inviting submissions in response.

Qantas and Jetstar Airways wish to continue coordinating with each other and the Jetstar joint ventures Jetstar Asia and Jetstar Japan. Jetstar is also seeking to coordinate with its shareholding airlines including Qantas and Japan Airlines on passenger and cargo services within Asia in certain circumstances.

The ACCC has previously authorised this coordination in 2013 and 2018.

“The continued coordination of the Jetstar branded airlines allows them to operate as a single fully integrated organisation on matters such as flight scheduling, sales and marketing, and pricing,” ACCC Commissioner Anna Brakey said.

“The ACCC considers that the coordination is likely to result in public benefits by providing consumers with a wider choice of products, enhanced services, and more convenient flight times.”

“This conduct is likely to result in little, if any, lessening of competition,” Ms Brakey said.

The proposed re-authorisation does not allow coordination between Qantas and Japan Airlines.

The ACCC is now seeking submissions in response to the draft determination and interim authorisation decision by 17 March 2023, before making its final decision.

Further details about the application and how to make a submission are available on the ACCC’s public register at  Qantas Airways Limited & Jetstar Airways Pty Ltd.

The Qantas Group has established the Jetstar Asia and Jetstar Japan joint ventures because in some international jurisdictions the regulatory environment makes it difficult for airlines to wholly or majority own airlines outside their own country.

Notes to editors

ACCC authorisation provides statutory protection from court action for conduct that might otherwise raise concerns under the competition provisions of the Competition and Consumer Act (CCA).

Section 91 of the CCA allows the ACCC to grant interim authorisation when it considers it is appropriate. This allows the parties to engage in the proposed conduct while the ACCC is considering the merits of the substantive application.

The ACCC may review a decision on interim authorisation at any time, including in response to feedback raised following interim authorisation.

Broadly, the ACCC may grant authorisation when it is satisfied that the likely public benefit from the conduct outweighs any likely public detriment.

Source: Australian Ministers for Regional Development

The number of residential NBN services declined for the first time in the December 2022 quarter, by 0.1 per cent – or almost 9,000 – to approximately 8.73 million, the ACCC’s latest NBN Wholesale Market Indicators Report reveals.

The report looks at the wholesale market for NBN services, in which retail service providers purchase access for supply to consumers and businesses.

The top three providers, Telstra, TPG and Optus, collectively experienced a decrease of almost 95,000 services, to 6.8 million. This reduced their market shares slightly to 42.4 per cent, 22.4 per cent and 13.1 per cent respectively.

Conversely, the report found that Vocus and other smaller providers gained approximately 86,000 services, to 1.9 million, making up the remaining 22.1 per cent of the market.

This was a trend throughout 2022, where NBN services acquired by the four largest providers – Telstra, TPG, Optus and Vocus – decreased by over 227,000 services annually while other smaller providers gained almost 363,000 services.

“This shift from the larger providers to smaller ones is helping to enable greater competition within the sector,” ACCC Commissioner Anna Brakey said. 

The report also found that while the 50 Mbps speed tier remains the most popular, accounting for almost 53 per cent of residential services, it decreased by more than 131,000 services (1.4 percentage points) during the quarter.

There was a large increase in the second-most popular 100 Mbps tier, with almost 190,000 new services (2.2 percentage points), making it account for over 13 per cent of all services.

This quarter also saw decreases in the 250 Mbps and 12 Mbps tier services, approximately 54,000 and 28,000 (0.6 and 0.3 percentage points) respectively, to 1.3 per cent and 8.8 per cent of residential NBN services.

“We continue to see consumers choosing higher speed products, but we urge them to carefully assess their needs before rushing into a decision to upgrade to a more expensive plan,” Ms Brakey said.

“Less expensive 25 Mbps speed plans allow households to access most online applications, including high-definition streaming applications, with retailers generally recommending their 100 Mbps speed tiers for households of at least 5 or 6 occupants, or those that have special requirements.”

Currently there are 19 broadband providers accessing NBN directly at all 121 points of interconnection (POIs), compared to 13 in the December 2021 quarter. The POIs are the physical locations where providers can connect to the NBN.

“This growing presence of broadband providers across NBN’s points of interconnection means improved competition and greater choices for consumers in more areas,” Ms Brakey said.

The quarterly average bandwidth that NBN supplied to consumers through retail providers increased by 1.6 per cent to 2.97 Mbps per user.

Further information, including time series data, is available on the ACCC website at NBN Wholesale Market Indicators Report.

Background

The ACCC’s NBN Wholesale Market Indicators Report contains information on NBN Co’s provision of wholesale services to retail service providers. It does not report on the services supplied by retail service providers to end users. Retail service information is available via the ACCC’s Internet Activity record keeping rule report.

Retail service providers use NBN Co’s wholesale access service to supply retail services to their own customers or, alternatively, to supply a wholesale service to another (usually smaller) retail service provider.

Most small retail service providers do not directly connect with NBN Co, instead reselling services that they buy from larger providers such as Telstra, TPG and Optus.

Source: Australian Ministers for Regional Development

Consumer and competition issues in essential services, environmental claims and sustainability, financial services and other critical areas will be among the ACCC’s compliance and enforcement priorities during 2023-24, ACCC Chair Gina Cass-Gottlieb announced today.

Unveiling the ACCC’s annual compliance and enforcement priorities at a Committee for Economic Development Australia (CEDA) event in Sydney, Ms Cass-Gottlieb also listed as a focus competition and pricing issues in gas markets including compliance with the recently-applied price cap order.

“Our priorities must and do reflect the issues impacting the Australian economy, consumers and businesses in Australia,” Ms Cass-Gottlieb said.

“The present key issues of cost of living pressures, the price of essential services including energy and telecommunications, the integrity of environmental and sustainability claims, ever increasing losses to scams, consumer and fair trading harms from manipulative marketing practices in the digital economy and the always high risk to markets, business rivals and consumers from anti-competitive conduct, strongly feature in our priorities.”

The ACCC’s focus on environmental claims and sustainability was broadening beyond consumer and fair trading issues to include competition law and product safety considerations, Ms Cass-Gottlieb said.

“We’ve established a new internal taskforce focused on sustainability that will build our expertise, inform and coordinate our efforts across the agency,” she said.

“In particular the taskforce will examine and seek to influence a range of issues where environmental and sustainability issues intersect with the application of competition and consumer law, including product safety.”

Ms Cass-Gottlieb said the ACCC would again focus on the energy and telecommunication sectors in its work addressing consumer and competition issues in essential services and noted the ACCC had secured significant outcomes in this area during the past year.

“Misleading sales representations in relation to the price, features or benefits of essential services prevent consumers making informed purchasing decisions,” Ms Cass-Gottlieb said.

“It’s particularly important that consumers and businesses can make informed decisions about what services are right for them in relation to price and the quality of the services when they are struggling with shrinking household budgets.”

Ms Cass-Gottlieb said the ACCC’s work in the energy sector would account for a substantial share of the agency’s compliance and enforcement efforts in the year ahead.

Manipulative and deceptive practices in connection with digital services would continue to be a key priority for the ACCC, Ms Cass-Gottlieb said, noting that the results of a recent sweep of social media influencers not disclosing commercial relationships including paid promotions would inform the ACCC’s ongoing compliance and education initiatives and enforcement investigations.

The introduction of new laws prohibiting unfair contract terms that include a new penalty regime later this year would be an important change for consumers and small business and would also play an important role in the ACCC’s enforcement priorities, Ms Cass-Gottlieb said.

“Businesses need to understand their responsibilities under these new laws, or they could find themselves subject to severe penalties,” Ms Cass-Gottlieb said.

“We will be working to ensure that consumers and small businesses, including franchisees, enjoy the full benefit of these strengthened laws.”

Ms Cass-Gottlieb said that scams continued to wreak tremendous personal and financial damage on consumers and the Australian economy.

“Our Scamwatch service will continue to support government agencies and industry participants in the disruption of scams,” Ms Cass-Gottlieb said.

“We are also lending our expertise and support to prepare the establishment of the Government’s National Anti-Scams Centre.”

Ensuring we all get the benefit of competition in the financial services sector will remain a priority for the ACCC in the coming year.

“We have already commenced our inquiry into retail deposit markets, looking at how banks set interest rates for deposit products,” Ms Cass-Gottlieb said.

Ms Cass-Gottlieb confirmed the ACCC would maintain its enduring compliance and enforcement priorities, which target conduct so detrimental to consumer welfare and the competitive process that the ACCC would always regard them as a priority.

They included conduct impacting First Nations consumers, cartel conduct and anti-competitive conduct more broadly.

“Our focus on issues impacting First Nations consumers has now become integral to the larger remit of the ACCC’s work as we identify the disproportionate impact of conduct such as scams and misleading advertising and sales practices on their communities,” Ms Cass-Gottlieb said.

“Our inquiries into the insurance sector, childcare and mobile regional infrastructure allow us to look at the challenges faced by First Nations people in accessing and acquiring key services.”

The ACCC will announce its annual product safety priorities at the National Consumer Congress later in the year.

More information including the full list of the ACCC’s 2023-24 enforcement priorities is available at Compliance and enforcement policy and priorities. 

A transcript of the speech is available at www.accc.gov.au/media/speeches

Source: Australian Ministers for Regional Development

The ACCC will be investigating a number of businesses for potential ‘greenwashing’, following an internet sweep which found more than half of the businesses reviewed made concerning claims about their environmental or sustainability practices.

Of the 247 businesses reviewed during the sweep, 57 per cent were identified as having made concerning claims about their environmental credentials. The cosmetic, clothing and footwear and food and drink sectors were found to have the highest proportion of concerning claims among the industries targeted in the operation. Other sectors examined also had a significant proportion of concerning claims.

“Our sweep indicates a significant proportion of businesses are making vague or unclear environmental claims. This warrants further scrutiny,” ACCC Deputy Chair Catriona Lowe said.

“Consumers are now, more than ever, making purchasing decisions on environmental grounds. Unfortunately, it appears that rather than making legitimate changes to their practices and procedures, some businesses are relying on false or misleading claims. This conduct harms not only consumers, but also those businesses taking genuine steps to implement more sustainable practices.”

“Businesses using broad claims like ‘environmentally friendly’, ‘green’, or ‘sustainable’ are obliged to back up these claims through reliable scientific reports, transparent supply chain information, reputable third-party certification or other forms of evidence.”

“Where we have concerns, we will be asking businesses to substantiate their claims,” Ms Lowe said.

“Already, we have several active investigations underway across the packaging, consumer goods, food manufacturing and medical devices sectors for alleged misleading environmental claims and these may grow, as we continue to conduct more targeted assessments into businesses and claims identified through the sweep. We will take enforcement action where it is appropriate to do so as it is critical that consumer trust in green claims is not undermined.”

The ACCC will also conduct a range of education activities with businesses, including updating economy-wide guidance material, in addition to targeted guidance for specific sectors.

“The sweep has helped inform our forthcoming guidance about what steps businesses need to take to improve the integrity of their environmental claims,” Ms Lowe said.

“We want to see businesses taking steps to ensure that environmental claims are accurate as well as meaningful for consumers. Our sweep has shown that claims are most useful where they are relevant, clear, reliable and transparent.”

“We will engage directly with businesses and industry associations to improve compliance with the Australian Consumer Law.”

“Importantly, we encourage businesses to come forward if they become aware they have made false or misleading marketing claims. Businesses who cooperate and advise of any issues with their operations, will be considered more favourably than those who wait for the ACCC to unearth these problems,” Lowe said.

The ACCC encourages consumers and businesses to contact the ACCC to report any potentially misleading environmental or sustainability claims. Report a consumer issue.

Background

The ACCC conducted an internet sweep to identify misleading environmental and sustainability marketing claims in October/November 2022.

Sweepers reviewed 247 company websites across a range of targeted sectors including energy, vehicles, household products and appliances, food and drink packaging, cosmetics, clothing and footwear.

Each year, the ACCC announces a list of compliance and enforcement priorities. These priorities outline the areas of focus for the ACCC’s compliance and enforcement activities for the following year.

As part of the 2022-23 Compliance and Enforcement Priorities, the ACCC is prioritising consumer and fair-trading issues in relation to environmental and sustainability claims.

Under the Competition and Consumer Act 2010, the ACCC can use powers under s155 of the Act to obtain information, documents and evidence in relation to matters which may constitute a contravention of the Act. The ACCC can also issue substantiation notices requiring a person or business to give information and/or produce documents that could be capable of substantiating or supporting a claim or representation made by the person or business.

Source: Australian Ministers for Regional Development

Sydney waste companies, Aussie Skips Recycling and Aussie Skips Bin Services (together Aussie Skips), along with its chief executive Emmanuel Roussakis have today each pleaded guilty in the Federal Court to a criminal cartel offence following charges laid by the Commonwealth Director of Public Prosecutions (CDPP) last December.

The charges relate to allegations that in mid-2019, Aussie Skips and Bingo Industries agreed to increase and fix prices for the supply of skip bins and processing services for building and demolition waste in Sydney. The case was investigated by the ACCC and then referred to the CDPP, which laid criminal charges.

Bingo and its former Managing Director and CEO, Mr Daniel Tartak have previously entered guilty pleas in relation to the same cartel.

“Cartels are illegal because they can cause serious economic damage to the economy. This is also the reason why the ACCC takes investigations into cartel conduct seriously and will continue to refer matters to the CDPP when appropriate,” ACCC Deputy Chair Mick Keogh said.

The matter will now proceed to a sentencing hearing for Aussie Skips and Mr Roussakis in the Federal Court on 22 to 23 May 2023.

As these are criminal matters currently before the Court, the ACCC will not provide further comment at this time.

Background

Aussie Skips Bin Services and Aussie Skips Recycling are Sydney-based waste management businesses that supply skip bins and waste processing services for building and demolition waste respectively.

Bingo is a waste management company providing landfill, waste processing and skip bins services throughout New South Wales, Victoria and Queensland.

Note to editors

The ACCC investigates cartel conduct, manages the immunity process and, in respect of civil cartel contraventions, takes proceedings in the Federal Court.

The ACCC works to detect cartels including through education programs, proactive intelligence gathering and data assessment and working with overseas counterparts to identify cartels that operate on a global level.

The ACCC also manages an immunity program that enables past or present cartel members to confess their actions and cooperate with investigations in exchange for immunity from ACCC-initiated civil and (through the CDPP) criminal proceedings.

Anyone who thinks they may be involved in cartel conduct is urged to call the ACCC Cartel Immunity Hotline on (02) 9230 3894. More information about the immunity process is available on the ACCC website at Cartels.

You can also report cartel conduct by using the anonymous cartel portal. The CDPP is responsible for prosecuting criminal cartel offences in accordance with the Prosecution Policy of the Commonwealth. The ACCC refers serious cartel conduct to the CDPP for consideration of prosecution in accordance with the Memorandum of Understanding between the CDPP and the ACCC regarding Serious Cartel Conduct.

An individual convicted of a criminal cartel offence may be sentenced to up to 10 years’ imprisonment or fined up to $444,000, or both.

For corporations, the maximum fine for each criminal cartel offence before 9 November 2022 is the greater of:

• $10 million
• three times the total benefit that has been obtained and which is reasonably attributable to the commission of the offence, or
• if the value of the benefit obtained cannot be determined, 10 per cent of the corporation’s annual turnover connected with Australia.

These maximum fines are applicable to the charges against Aussie Skips.  

For offences that occur after 9 November 2022, substantially higher maximum fines apply.

Source: Australian Ministers for Regional Development

The ACCC will examine the expanding ecosystems of digital platform service providers in Australia as part of its’ five-year Digital Platform Services Inquiry.

Large digital platform service providers, like Alphabet (Google), Amazon, Apple, Meta (Facebook) and Microsoft, continue to invest heavily across different sectors and technologies, creating a web of interconnected products and services.

“Australian consumers and businesses are increasingly reliant on the products and services offered by digital platforms so it’s crucial we examine how these companies are expanding their reach,” ACCC Chair Gina Cass-Gottlieb said.

Selection of the different sectors and technologies Alphabet, Amazon, Apple, Meta and Microsoft have expanded into in Australia over the past decade.

An issues paper, published today, poses questions and seeks submissions from consumers, businesses and interested stakeholders about the investment decisions made by digital platforms, the interconnectedness of expanded products and services within each ecosystem and the potential impacts on competition and consumers.

The interim report will examine products and services offered by digital platform service providers across a variety of sectors and will use examples like the expansion into consumer cloud storage and smart home devices to analyse the relationships between digital platform services and various services offered in their digital platform ecosystems.

“We’re eager to hear from consumers and business about their experiences with digital platform services within these ecosystems, and how they also use other related consumer cloud storage services and smart home devices within a digital platform ecosystem,” Ms Cass-Gottlieb said.

“Large digital platforms have become an integral part of our daily lives, they have access to enormous user data bases and personal information across their ecosystems.”

“This report will assess how that data can leveraged across products and services within an ecosystem that may prevent businesses from entering and competing,” Ms Cass-Gottlieb said.

The interim report will also examine the expansion strategies used by digital platform service providers and how this has affected interoperability of products and services across ecosystems and if it has increased consumer lock-in behaviours or other conduct like bundling, tying or self-preferencing to inhibit competition.

Excessive collection and potentially problematic use of personal data or other behaviours such as dark patterns to confuse or manipulate consumers will also be considered.

“Interconnected products, like smart home devices and cloud storage solutions, can provide consumers with a seamless experience that simplifies everyday tasks, but it’s important that competition and consumers are not harmed as digital platforms invest across different sectors and technologies and expand their reach,” Ms Cass-Gottlieb said.

Submissions are due by 5 April 2023 and can be made by emailing digitalmonitoring@accc.gov.au.

Background

The ACCC’s Digital Platforms Branch is conducting a five-year inquiry into markets for the supply of digital platform services in Australia and their impacts on competition and consumers, following a direction from the Treasurer in 2020. The inquiry reports to the Treasurer every six months and examines different forms of digital platform services, their advertising services as well as data brokers.

This issues paper will inform the ACCC’s seventh report due to be submitted to the Treasurer by 30 September 2023. The ACCC’s sixth report on competition and consumer issues relating to social media services in Australia is due to the Treasurer by 31 March 2023.

Previous reports are published at Digital platforms services inquiry 2020-25.

Notes to the editor

‘Bundling’ refers to where a supplier only offers two products or services as a package, or for a lower price if the two products or services are purchased together.

‘Dark patterns’ refers to the design of user interfaces intended to confuse users, make it difficult for users to express their actual preferences, or manipulate users into taking certain actions.

‘Self-preferencing’ refers to where a platform gives preferential treatment to its own products and services when they compete with products and services provided by third parties using their service.

‘Tying’ in this context refers to when a digital platform makes access to a service conditional on using another service.

Source: Australian Ministers for Regional Development

The Federal Court has today ordered Booktopia Pty Ltd (Booktopia) pay $6 million in penalties for making false or misleading representations on its website, and in dealings with consumers, about consumer guarantee rights.

Booktopia admitted that from at least 10 January 2020 to 2 November 2021, Booktopia made misleading statements in its online Terms of Business that consumers were only entitled to a refund, repair or replacement if they notified Booktopia within 2 business days of receiving a product that was faulty or not what they ordered.

Booktopia also admitted that its Terms of Business contained misleading representations, by stating that consumers were not entitled to a refund for digital products such as eBooks for any reason, including if the product was faulty.

Booktopia also admitted that it made misleading statements to 19 individual consumers in customer service calls by advising the consumers that it did not have an obligation to provide a refund or replacement if the consumer had not notified Booktopia within 2 business days of delivery, even if the product was faulty.

“Booktopia made misleading statements to consumers, telling them they were only entitled to a refund if they contacted them about a problem with their purchase within 2 business days of delivery,” ACCC Commissioner, Liza Carver said. 

“Consumers are entitled to return faulty products within a reasonable time and receive a refund, repair, or replacement, depending on the nature of the fault.”

“We do not know how many consumers may have been deterred from seeking a refund or replacement by Booktopia’s misleading representations on its website,” Ms Carver said.

In addition to ordering a $6m penalty, the Court ordered Booktopia to publish a notice on its website within 21 days correcting the false or misleading claims, and to establish a consumer law compliance program.

The ACCC and Booktopia made joint submissions in relation to penalty and other relief in this matter. The penalty figure put to the Court took into account Booktopia’s cooperation and financial position.

Background

On 10 December 2021 the ACCC instituted proceedings against Booktopia.

Booktopia is Australia’s largest online bookseller. Through the Booktopia Website, Booktopia supplies physical books, magazines, calendars, maps, stationery, games and puzzles, and also digital content such as eBooks and audio books, to consumers in Australia.

Under Australian Consumer Law, a consumer is entitled to a refund or replacement, or may request a repair, within a reasonable timeframe if something they bought has a major fault.

Businesses cannot place restrictions on consumer rights.  

More information at Consumer rights and guarantees.