LABOR WILL MAKE MERGER ANALYSIS SMARTER
Corporate misbehaviour at the expense of everyday Australians will be targeted under a Shorten Labor Government, which will require the competition watchdog to learn from its track record on approving mergers.
Many sectors in Australia are heavily concentrated, which can lead to firms using their market power to raise prices. Despite this, there is currently no official process for the Australian Competition and Consumer Commission to decide whether it made a mistake in allowing mergers.
From 1989 to 2018, the number of mergers in Australia increased seven-fold, from 259 to 1909, with the total value of merger transactions rising from US$34 to US$146 billion. As every sports fan knows, if you don’t learn from your past performance, you’re less likely to improve in the future.
Post-merger reviews would allow the Australian Competition and Consumer Commission to test the claims that were made at the time the merger was approved. These independent and transparent reviews – to be carried out twice in the decade following the merger – will consider the impact of mergers on economic outcomes such as productivity, prices, employment and wages.
Such measures would help Australia avoid the negative impacts of mergers, such as the problematic US mergers between America Online and Time Warner, or between eBay and Skype.
It will not attempt to undo mergers that have already taken place.
This measure will build on Labor’s competition policies, including:
- giving consumer and small business advocacy groups the power to make ‘supercomplaints’ about consumer rip-offs;
- protecting small business through making unfair contract terms illegal;
- making it easier and cheaper to send money to family and friends overseas by requiring full fee disclosure on remittances;
- making it more affordable to fix your car by requiring car manufacturers to share technical information with independent mechanics on commercially fair and reasonable terms;
- introducing an industry-specific code under the Competition and Consumer Act to deliver clear rules to better regulate negotiations between manufacturers and dealerships;
- introducing Access to Justice reforms to Parliament, which helps small businesses take court cases to address anti-competitive conduct;
- Doubling the competition regulator’s litigation budget and amending the Competition and Consumer Act to give a truly independent market studies function to the regulator;
- Allowing the Courts to apply higher penalties for conduct that targets or disproportionately impacts disadvantaged Australians;
- Requiring the Australian Competition and Consumer Commission prioritise investigations of conduct that targets or disproportionately impacts disadvantaged Australians;
- Investigating the impacts of increased market concentration on income inequality in Australia and produce policy recommendations on how the negative effects of market concentration can be mitigated;
- And encouraging States and Territories to include competition principles in planning and zoning legislation, as recommended by the Harper Review, with a specific focus on shortfalls of appropriately zoned land for key services in disadvantaged communities.
While Scott Morrison and his chaotic Coalition continue to back millionaires and multinationals, Labor is shaping policies that will help all Australians.
Authorised by Noah Carroll ALP Canberra.