Anti-competitive Behaviour

Competition and Consumer Act 2010

An act or conduct of reducing or killing the competition in a market is a criminal offence and may attract a term of imprisonment, with a maximum penalty of 10 years if found guilty. In Australia, the Competition and Consumer Act 2010 (Cth) (CCA) (previously the Trade Practices Act 1994) prevents anti-competitive behaviours such as cartel conduct, anti-competitive agreements, misuse of power, exclusive dealing and fixing resale prices. ‘Substantially lessening the competition’ involves practices adopted by a business with a purpose, to substantially lessen or to likely lessen the competition in a market. A market mostly has four elements; product, geography, level of function and time. Hence, while entering an agreement with your competitors, it is necessary to consider that you are not breaking the laws that have been formulated to promote healthy competition in the market for consumer welfare.

Cartel conduct

Cartel conduct is a type of anti-competitive act when the competitors enter into agreements to fix prices, bid rigs, reduce or restrict the availability of goods or services for profit, divide the market to reduce the need to compete for custom. Cartel conduct often creates an illusion of competition in the market.

Exclusive dealings

Anti-competitive behaviour may also be demonstrated by exclusive dealings, which are acts of agreeing to restrict the competitor’s freedom to sell their products and to build their market in a particular field. This substantially reduces the competition for the other party and creates a situation of exclusive dealing. Supplying on the condition, refuse to supply, accusation restrictions, resale price fixing, forcing supply though the third line, forcing refusals to supply via the third line are examples of exclusive dealing

Price fixing

A supplier can suggest a retail dealer on the price, but cannot fix the amount of resale price. Exclusive dealing to fix the resale price is a kind of vertical price-fixing to eliminate inter and intra-brand competition. Legal advice may be helpful if you find yourself being victimised in anti-competitive behaviour as a consumer.