Headed by economist, Ian Harper, the policy is the biggest review of competition policy in two decade, and stated retail markets had been an important focus, including competition in grocery and pharmacy retailing.
“Australia’s competition policy needs to be fit for purpose, and updated for the economic opportunities and challenges Australia will face in coming decades. We face forces for change from increased globalisation, population ageing and new technologies, which are rapidly changing the way our markets operate,” Professor Harper said.
Draft recommendations for the retail industry include reformulate misuse of market power provision, introduce competition principles in planning and zoning rules, examine liquor licensing rules as part of a review of regulatory restrictions, remove pharmacy ownership and location rules, and promote the development of industry codes.
The report also said trading hour restrictions should be abolished as they are anti-competitive, however, Christmas Day, Good Friday, and Anzac Day mornings should remain exceptions.
“Today’s release of the draft report from the Competition Policy Review committee is comprehensive and includes a raft of recommendations on a range of retail industry issues,” Rob Hadler, acting CEO of the Australian National Retailers Association (ANRA) said.
“Competition in the retail sector has never been stronger with the introduction of new competitors both instore and online.There are some positive recommendations that if adopted will drive lower prices and more choice for consumers, like trading hours reform,” Hadler said.
Consumer group, Choice, said among the broad sweep of recommendations on competition policy, laws, and institutions, it was pleasing to see a focus on axing what it calls the ‘Australia tax’ – the artificially high prices paid by local consumers for a range of goods and services.
“We provided evidence of the significantly higher prices Australians pay for identical products, ranging from new release movies, games and TV series to clothing and cosmetics,” Choice said.
“The review has responded with support for market solutions to empower consumers and help them beat the ‘Australia tax’.
“This includes exposing industries to greater competition from overseas, for example by reforming intellectual property laws, removing restrictions on parallel importing and giving Australians the confidence to get around barriers, like online geoblocking, that keep local prices high.”
The review also recommends the creation of a new body, the Australian Council for Competition Policy, replacing the National Competition Council.
Russell Zimmerman, executive director of the Australian Retailers Association (ARA) said the ARA is hopeful the review will help identify ways to build the economy and promote investment, growth, job creation, and durable benefits to consumers and retailers alike.
“We certainly welcome the panel’s view that there is a need to reinvigorate Australia’s competition policy, and ensure that competition policy evolves,” Zimmerman said.
“We were pleased to see the issue of trading hours brought to attention – as long as retailers are not forced to open by landlords if not profitable.”
The review has also been welcomed by the Australian Competition and Consumer Commission (ACCC).
ACCC chairman, Rod Sims, said the draft report is part of the most significant review in this area for more than 20 years.
“The ACCC particularly welcomes the panel’s view that there is a need to reinvigorate Australia’s competition policy, and ensure that competition policy evolves,” Sims said.
Consultation on the draft report is now open, and will run for eight weeks until November 17 2014, with the final report due in March next year.