'Super' protection for consumers and small businesses

A means for the ACCC to prioritise complaints 5 min read

New legislation seeks to create a specific complaints handling function within the Australian Competition and Consumer Commission (ACCC) for those lodged by designated consumer and small business advocacy groups.

The Treasury Laws Amendment (Measures For Future Bills) Bill 2023: ACCC Designated Complaints Function was introduced into Parliament on 15 February 2024, following public consultation last year, and is expected to commence from July 2024.

In this Insight, we examine the intention of the legislation, how it's expected to operate and its likely impact on businesses with significant consumer and small business dealings.

Key takeaways

• There is currently no process for the ACCC to prioritise complaints from consumer and small business advocacy groups. The ACCC and Treasury are seeking to formally recognise the importance of complaints lodged by consumer and small business organisations.
• The introduction of the regime is in line with the Federal Government's stated priority to tackle 'cost of living pressures'.
• Complaints will need to meet a particular threshold before they're assessed under the 'super complaints' process.
• The designation of complainants will sit solely with the Minister. The names of the entities approved must also be published on Treasury's website.

Background: a backlog in investigations and resolutions

There is currently no process for the ACCC to prioritise complaints from consumer and small business advocacy groups. Presently, these complaints are reviewed alongside the numerous other complaints received by the ACCC, often leading to delays in investigation and resolution.

The introduction of a 'super complaint' process essentially fast-tracks and prioritises 'super complaints'. Under the regime, the ACCC will be required to prioritise, assess and respond to, complaints submitted by 'designated complainants' within 90 days. The Minister, not the ACCC, will be responsible for approving requests to be considered a 'designated complainant', but it is expected that this will be limited to consumer and small business advocacy groups (although technically individuals may also apply for complainant status).

The ACCC and Treasury are seeking to formally recognise the importance of complaints lodged by consumer and small business organisations.

How the process will operate

Complaints will need to meet a particular threshold before they're assessed under the 'super complaints' process. In this regard, designated complainants must demonstrate:

• a significant or systemic market issue that affects consumers or small businesses in Australia; and
• that the complaint relates to either a potential breach of the Competition and Consumer Act (CCA) or the ACCC's powers or functions under the CCA.

This means complaints could relate to alleged contraventions of either the competition or consumer law provisions of the CCA.

To the extent that the ACCC is of the view that further action needs to be taken at the end of its 90-day review period, it will be required to commence any action within six months. Although the legislation does not detail the type of actions the ACCC may undertake at the end of its investigation, looking to the UK (which has had a similar process in place since around 2012), possible outcomes might include:

• taking enforcement action (ie commencing proceedings in the Federal Court);
• agreeing voluntary changes with the industry / relevant industry participants;
• launching a market inquiry; or
• recommending action by the Government, a regulatory body or other organisation.

One example of the UK's Competition and Markets Authority's (CMA) 'super complaints' process in action relates to a 2018 complaint by Citizens Advice, a consumer advocacy body, regarding long-term customers paying more for goods and services (ie paying ‘the loyalty penalty’). In practice, this happens when suppliers charge higher prices to their existing customers, who they think are unlikely to switch to secure better prices, service quality, products etc.

Following its investigation, the CMA set out a package of suggested reforms. These included:

• enforcement action by the CMA;
• publishing a set of core principles for businesses to follow to ensure compliance;
• providing genuine support to consumers through the use of (i) data-driven technologies and services, (ii) intermediaries (including price comparison websites, automatic switching services, or local face-to-face advisory services), and (iii) offering ‘collective switching’ on tailored terms;
• recommendations to other regulators (including legislative reform); and
• pricing interventions.

Who will be the super complainants in Australia?

There have been a number of other super complaints lodged with the CMA over the years, with many resulting in inquiries and enforcement action across a range of industries, including in relation to supply to pubs, grocery, banking, passenger transport, care homes, gas and electricity, insurance and dentistry, amongst others.

This does not mean the same industries will be scrutinised in Australia under the new ACCC super complaints regime. An indication of which industries might be subject to a complaint will come from which organisations apply for, and receive, designated complainant status in Australia.

In the UK, a number of consumer bodies have been designated as super complainants under the CMA regime, including¹:

• Citizens Advice (formerly known as the National Association of Citizens Advice Bureaux)
• Which?
• Energywatch
• Postwatch (now defunct)
• Campaign for Real Ale
• General Consumer Council for Northern Ireland
• Consumer Focus (now defunct)
• The Federation of Small Businesses
• Consumer Council for Water (formerly known as Watervoice).

In Australia, the designation of complainants sits solely with the Minister. The names of the entities approved must also be published on Treasury's website. It will be interesting when the list of designated complainants is released, as it will shed light on the likely focus of super complainant originated work by the ACCC.

The proposal to introduce a super complaints framework was first mooted by current Assistant Minister for Competition, Andrew Leigh, during the 2019 Australian federal election (see here). At the time, Leigh said the proposal was modelled on the UK regime and the Bill is largely in line with those original proposals. Leigh noted that one of the benefits of the regime was to prevent advocacy groups' concerns from being 'log-jammed' within the ACCC to 'kick start issues that may be stuck, including forcing a response from government on matters of public importance'.

The introduction of the regime therefore comes as no surprise and is in line with the Federal Government's stated priority to tackle 'cost of living pressures'. The regime itself is likely to focus on more consumer-facing issues, although business-to-business dealings cannot be excluded, as UK experience shows, which is consistent with the ACCC's focus on issues impacting small businesses. Accordingly, businesses with significant consumer and small business dealings should take note of these developments in particular.