Competition and Consumer Legislation Amendment Act 2011
No. 184, 2011
An Act to amend the law relating to competition and consumers, and for related purposes
Contents
1 Short title
2 Commencement
3 Schedule(s)
Schedule 1—Mergers and acquisitions
Competition and Consumer Act 2010
Schedule 2—Unconscionable conduct
Australian Securities and Investments Commission Act 2001
Competition and Consumer Act 2010
Schedule 3—Technical amendments
Trade Practices Amendment (Australian Consumer Law) Act (No. 2) 2010
Competition and Consumer Legislation Amendment Act 2011
No. 184, 2011
An Act to amend the law relating to competition and consumers, and for related purposes
[Assented to 6 December 2011]
The Parliament of Australia enacts:
1 Short title
This Act may be cited as the Competition and Consumer Legislation Amendment Act 2011.
2 Commencement
(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information |
Column 1 | Column 2 | Column 3 |
Provision(s) | Commencement | Date/Details |
1. Sections 1 to 3 and anything in this Act not elsewhere covered by this table | The day this Act receives the Royal Assent. | 6 December 2011 |
2. Schedule 1 | A single day to be fixed by Proclamation. However, if the provision(s) do not commence within the period of 2 months beginning on the day this Act receives the Royal Assent, they commence on the day after the end of that period. | 6 February 2012 |
3. Schedule 2 | The later of: (a) the day this Act receives the Royal Assent; and (b) 1 January 2012. | 1 January 2012 |
4. Schedule 3 | Immediately after the commencement of Schedule 5 to the Trade Practices Amendment (Australian Consumer Law) Act (No. 2) 2010. | 1 January 2011 |
Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.
(2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.
3 Schedule(s)
Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.
Schedule 1—Mergers and acquisitions
Competition and Consumer Act 2010
1 Subsections 50(1) and (2)
Omit “a market”, substitute “any market”.
2 Subsection 50(6) (definition of market)
Omit “substantial”.
3 At the end of Part XIII
Add:
Division 2—Application of amendments made by the Competition and Consumer Legislation Amendment Act 2011
179 Amendments of section 50
The amendments of section 50 made by Schedule 1 to the Competition and Consumer Legislation Amendment Act 2011 apply to acquisitions occurring after the commencement of that Schedule.
4 Subsection 50(1) of Schedule 1
Omit…
Overview
The Competition and Consumer Legislation Amendment Act 2011, enacted on 6 December 2011 by the Parliament of Australia, is a legislative amendment that aims to refine and strengthen the existing legal framework governing competition and consumer protection. This Act was introduced to address issues and gaps in the legislative provisions pertaining to mergers and acquisitions, as well as unconscionable conduct in both financial services and goods or services. It seeks to provide greater clarity and enforceability in these areas by amending the Competition and Consumer Act 2010 and the Australian Securities and Investments Commission Act 2001, among others. The overarching policy objective of the Act is to ensure fair and transparent commercial practices, thereby protecting consumers and maintaining competitive markets.
Scope and Application
The Competition and Consumer Legislation Amendment Act 2011 (Cth) amends several key pieces of Australian legislation to modify the legal framework concerning competition and consumer protection. The Act applies to entities and persons involved in mergers and acquisitions as well as those engaged in the supply or acquisition of goods, services, or financial products in trade or commerce. It specifically targets conduct that may be deemed unconscionable, ensuring these provisions apply to anyone except listed public companies. The jurisdictional reach of the Act is national, as it amends federal statutes such as the Competition and Consumer Act 2010 and the Australian Securities and Investments Commission Act 2001. The Act does not specify any exclusions, exemptions, or thresholds for its application, but it does note that its provisions do not apply to conduct engaged solely in the context of legal proceedings or arbitration. Certain amendments made by the Act to the Competition and Consumer Act 2010 apply to acquisitions occurring after the commencement of the amending Act. The Act also includes technical amendments to ensure consistency and coherence across related legislation.
Key Provisions
- The Competition and Consumer Legislation Amendment Act 2011 (Act) primarily focuses on making amendments to existing competition and consumer laws, particularly targeting mergers and acquisitions, and unconscionable conduct in connection with the supply or acquisition of financial services, goods, and services. The Act's main operative sections involve modifications to the Competition and Consumer Act 2010 (CCA) and the Australian Securities and Investments Commission Act 2001 (ASIC Act). Under section 1 of Schedule 1, the Act amends section 50 of the CCA by omitting the word "a" before "market" and removing the term "substantial" from the definition of market, thus broadening the scope of markets considered in merger assessments. Additionally, section 2 of Schedule 1 repeals sections 12CB and 12CC of the ASIC Act and replaces them with new provisions that explicitly prohibit unconscionable conduct in connection with financial services, goods, and services, and outlines the factors courts should consider in determining whether such conduct has occurred.
- The Act imposes several obligations on the parties and entities it governs. For mergers and acquisitions, businesses must now consider a broader range of markets when assessing the potential competitive impact of their transactions, as specified in the amended section 50 of the CCA. For financial services, goods, and services, suppliers and acquirers must ensure that their conduct in trade or commerce does not become unconscionable under the new provisions of sections 12CB and 21 of the CCA. This includes refraining from actions that could exert undue influence, use unfair tactics, or fail to disclose significant risks or intended conduct that might affect the interests of the other party. The Act also mandates that courts consider a wide array of factors when determining whether conduct is unconscionable, including the relative bargaining positions of the parties, the terms and conditions of any relevant contracts, and the extent of good faith in the commercial relationship.
- Failure to comply with the provisions of the Act can lead to significant legal consequences. Under sections 12CB and 21 of the CCA, engaging in unconscionable conduct in connection with financial services, goods, or services can result in both civil and criminal penalties. Civil penalties may include court-ordered injunctions, compensation orders, and pecuniary penalties. The maximum penalty for corporations found guilty of contravening these sections can be substantial, with fines potentially reaching up to $10.5 million for serious breaches. Additionally, individuals responsible for the corporation's conduct can face personal penalties, including fines and imprisonment. These provisions underscore the seriousness with which the Act treats breaches of consumer protection laws and aim to deter unscrupulous behaviour in commercial transactions.
- Area of Law
- Competition Law
- Consumer Law
- Instrument
- Act
- Concepts
- Commencement Provisions
- Repeal & Amendment
- Unconscionable Conduct
- Regulatory Standards
