Sustainability, living costs, digital economy: ACCC’s new portfolio
In August, the Trade Practices Act will celebrate its 50th birthday. To mark the occasion, the ACCC is focusing its efforts on its founding pledge to protect consumers.
Over the next 12 months, the ACCC will be targeting unfair practices related to sustainability, cost of living, and digital transformations.
ACCC chair Gina Cass-Gottlieb opened her annual address to the Committee for Economic Development of Australia by quoting former Attorney-General Lionel Murphy’s half-century-year-old second reading speech of the Trade Practices Act.
Murphy said unfair practices were causing “prices to be maintained at artificially high levels,” while allowing “discriminatory action against small businesses, exploitation of consumers, and feather-bedding of industries.”
Cass-Gottlieb said, fifty years on, the words ring true. Though community concerns have changed, opportunists continue to find ways to take advantage of consumers.
Principal among those concerns, said Cass-Gottlieb, are “the existential importance of the net zero transition, the opportunities and disruptions of the digital transformation, and the significant impact of cost-of-living pressures across our community. “
On sustainability, Cass-Gottlieb renewed warnings of corporate greenwashing – or, unsubstantiated claims about the environmental impact of goods and services – to take advantage of consumer preferences for sustainable offerings.
Notably, in November 2023, the ACCC accepted an enforceable undertaking from MOO Premium Foods in response to their false and misleading representations about using “100 per cent ocean plastic” in their yoghurt packaging.
The plastic resin used by the company was gathered from coastal areas around Malaysia, rather than directly from the ocean despite their claims.
“The ACCC has a number of in-depth greenwashing investigations including in the energy and consumer products sectors,” said Cass-Gottlieb.
The watchdog added it will be issuing guidance on how it recognises the “public benefits” of sustainability considerations in issuing conduct authorisations.
Beyond sustainability, the ACCC will be tailoring its enforcement activities to better protect consumers from anti-competitive conduct that could worsen cost-of-living pressures.
Given rising costs, “consumers are even more vulnerable to the effects of anti-competitive conduct that reduce competition in the supply of essential goods and services,” said Cass-Gottlieb.
Anti-competitive conduct strains already economically-pressured consumers by “restricting entry or expansion of competitors, reducing choice, and contributing to price escalation pressures,” she said.
Supermarkets, essential services, and aviation were all specifically mentioned as target sectors given their unique vulnerabilities to anti-competitive behaviours and their impacts on consumer finances.
The supermarket shift reflects “significant price increases in food and groceries,” and the concerns of consumers and producers, said Cass-Gottlieb.
In January, the Australian government directed the ACCC to carry out a 12-month price inquiry into competition in the grocery and supermarket sectors.
A similar inquiry in 2008 found that grocery retailing was “workably competitive” although the level of price competition was limited by a range of factors. For instance, “high barriers to entry and expansion,” a lack of competition from the independent sector, and the “limited incentives for Coles and Woolworths to compete aggressively on price.”
Finally, the ACCC will concentrate its enforcement activities against those involved in the digital economy, including misleading influencer marketing, online reviews, price comparison websites, and in-app purchases, said Cass-Gottlieb.
Last year, the majority of “problematic transactions’ identified by the Australian Consumer Law survey involved online commerce.
Targeted digital advertising has raised several novel challenges for the corporate watchdog. For instance, the ACCC last year found that over 80 per cent of reviewed influencer’s posts raised concerns from consumers.
Concerning in-app purchases, the video gaming industry will be targeted for its unique size and access to younger consumers.
“Far too often we hear concerns about consumers incurring huge purchases because of in-app offerings that have inadequate safeguards, or in some cases, deliberately target and nudge or confuse consumers,” said Cass-Gottlieb.
The ACCC will also target consumer guarantees, NDIS providers, and a range of “enduring priorities” including cartel conduct, conduct impacting Indigenous Australians, vulnerable or disabled consumers and small businesses.
