News
ACCC Declares it will Champion Small Online Retailers
- 21st February
- Campbell Phillips 154
The ACCC has warned that it intends to crack down on established merchants that engage in anti-competitive behaviour against online retailers.
The head of the Australian Competition and Consumer Commission (ACCC), Rod Sims delivered a speech to the Australia-Israel Chamber of Commerce recently. In it, he outlined the Commission’s focus areas for 2012, saying that the online market would be first priority.
“The online world will be front and centre of our focus in 2012,” Sims said. “As we all know, it is growing exponentially with some fascinating effects where, for example, established businesses with otherwise high entry barriers can now be challenged.”
Sims points to the fact that technology is allowing competition in areas where previously companies have been protected by physical and financial constraints. In the new digital age, however, nearly anyone can set up shop online. The phenomenon has already led to a significant outcry from larger retailers, followed by increasing complaints that the same retailers have begun engaging in anti-competitive behaviour.
“We must ensure [competition] can be done without established companies breaching the Act to protect themselves from competition from these new and emerging online players,” said Sims.
A number of cases of protectionism have already come to light. Recently, Eternal Beauty Products has been accused by the ACCC of pressuring retailers to sell goods at a certain price. In January last year, jewellery wholesaler Allure Gold was found to have sent a letter to resellers, instructing them not to sell products for less than 18 percent below recommended retail price.
According to Australian law, this practice is illegal, as merchants are allowed to sell products at whatever price they like.
“We do have investigations underway,” Sims told SmartCompany, “we’re looking at online businesses that are being held back through a variety of means, not just price maintenance but also refusal to supply.”
The ACCC encourages aggrieved parties to approach it with information, as the problem may be more widespread than it appears on the surface. Sim says it will protect any whistleblowers.
“They can come and talk to us confidentially and if we can get a number of people talking to us confidentially and we can build up a picture then we can take action in a general sense, rather than doing it in a way that exposes that individual.”
