Home Page / Legislation / Competition and Consumer Act 2010 / s 44ZZRV

Competition and Consumer Act 2010 (Cth)

WarningSection 44ZZRV
Collective acquisition of goods or services by the parties to a contract, arrangement or understanding

Note: The Harper Reforms came into operation on 6 November 2017. This section has been modified and re-numbered. This page reflects the content of the provision immediately prior to the commencement of the Harper Reforms. Please visit section 45AU for the current provision

 

The provision

(1) Sections 44ZZRF, 44ZZRG, 44ZZRJ and 44ZZRK do not apply in relation to a contract, arrangement or understanding containing a cartel provision, in so far as:

(a) the cartel provision has the purpose, or has or is likely to have the effect, mentioned in subsection 44ZZRD(2); and

(b) either:

(i) the cartel provision relates to the price for goods or services to be collectively acquired, whether directly or indirectly, by the parties to the contract, arrangement or understanding; or

(ii) the cartel provision is for the joint advertising of the price for the re­supply of goods or services so acquired.

Note: A defendant bears an evidential burden in relation to the matter in subsection (1) (see subsection 13.3(3) of the Criminal Code and subsection (2) of this section).

(2) A person who wishes to rely on subsection (1) in relation to a contravention of section 44ZZRJ or 44ZZRK bears an evidential burden in relation to that matter.

 

Legislative history

 

Legislative history

 

Relevant cases

ACCC v Olex Australia Pty Ltd [2017] FCA 222
Case dismissed - cartel allegations

 

Commentary

Background to introduction

The insertion of this provision was part of the package of reforms introducing criminal penalties for cartel conduct. The reforms also created a parallel civil cartel prohibition, replacing the former s 45A which dealt directly with price-fixing.

The reforms were initially recommend by the Dawson Committee as part of its 2002-2003 inquiry into the Competition Law provisions of the Trade Practices Act.

Cases

In ACCC v Olex Australia Pty Ltd [2017] FCA 222, one of the defendants, Rexel, argued that this defence applied. Justice Beach observed:

[664] Rexel asserts that the cutting fee provision relates to the price of cutting services (assuming for the moment that they can be conceptualised separately) to be collectively acquired by the Wholesalers from Olex. Rexel asserts that by reason of s 44ZZRV(1)(b)(i), ss 44ZZRJ and 44ZZRK do not apply to that provision.

[665] But the cutting fee provision did not involve the collective acquisition of cutting services by the Wholesalers. The Wholesalers were not a buying group (unlike Gemcell). Each acquired cutting services from Olex separately under their own supply arrangements with Olex. The ACCC does not allege that the Wholesalers collectively acquired or negotiated to collectively acquire cutting services (or indeed any other good or service) and there is no evidence of such collective acquisition. In my view, the cutting fee provision does not relate to the price for cutting services to be “collectively acquired” by the Wholesalers. The contended application of the defence in s 44ZZRV(1)(b)(i) therefore fails.

More information

See further information and resources on the cartel page.