The landscape of Australian competition law has shifted dramatically with the implementation of the Treasury Laws Amendment (More Competition, Better Prices) Act 2022. This landmark legislation, effective from November 10, 2022, has increased the maximum penalties for breaches of competition law, introducing significant financial risks for Queensland businesses. With penalties now reaching the greater of $50 million, three times the benefit gained, or 30% of turnover during the breach period, it’s critical for Queensland businesses to reassess their competition law compliance frameworks.
The New Penalty Regime: A Game-Changer for Queensland Commerce
The 2022 amendments represent the most significant overhaul of Australia’s competition penalties in over a decade. Under the new regime:
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Corporations now face penalties of up to $50 million per contravention — a 400% increase from the previous $10 million cap.
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Individuals could be fined up to $2.5 million — a doubling of the previous penalty of $500,000.
This reform directly targets anti-competitive behaviours such as cartel conduct, misuse of market power, exclusive dealing, and resale price maintenance — practices that may have been previously overlooked by some Queensland businesses due to lower penalty risks.
Challenges for Queensland Businesses
This sharp increase in potential penalties brings several immediate challenges for businesses:
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Increased Financial Exposure
Previously manageable risks may now pose an existential threat. High-turnover businesses, especially in Queensland’s retail and agricultural sectors, must reevaluate their risk management strategies. -
ACCC’s Intent to Pursue Maximum Penalties
The Australian Competition and Consumer Commission (ACCC) has made it clear they intend to pursue maximum penalties for serious anti-competitive conduct, placing more pressure on Queensland businesses to comply. -
Penalty Calculations Based on Turnover
The legislation now calculates penalties based on a business’s turnover, rather than profit. This could be financially devastating for low-margin, high-turnover businesses.
Impact on Queensland’s Business Community
The new regime has specific implications for Queensland businesses, including:
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Small and Medium Enterprises (SMEs): While a $50 million penalty might be absorbable by a multinational, it could be a fatal blow for an SME. Smaller businesses may lack the compliance resources of larger firms, making them more vulnerable.
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Industry-Specific Impact: Industries like retail, grocery, fuel, and telecommunications face increased scrutiny. Regional businesses with limited competition must be especially careful about misusing market power.
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Pressure on Directors and Executives: Company directors now face doubled personal penalties and potential disqualification for involvement in breaches, putting greater responsibility on leadership teams to ensure compliance.
Real-World Applications of the New Legislation
Consider these scenarios where Queensland businesses might face significant legal risks:
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Construction Industry: A group of competing contractors in Brisbane discussing project pricing at an industry event could face cartel conduct allegations, with penalties exceeding $50 million.
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Agricultural Supply: A dominant agricultural supplier in regional Queensland could face misuse of market power charges, with penalties potentially reaching 30% of their annual turnover.
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Retail Franchises: A retail franchisor imposing minimum price restrictions on franchisees could face hefty resale price maintenance penalties.
Protection Strategies for Queensland Businesses
To navigate this transformed legal landscape, Queensland businesses should take proactive steps:
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Conduct a Competition Law Audit: Review practices, agreements, and communications with competitors to identify potential compliance issues.
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Update Compliance Programs: Revise policies, training, and procedures to reflect the new penalty regime and ensure staff understand the heightened risks.
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Revise Risk Management Frameworks: Assess risks based on the new penalty structures, adjusting risk management strategies accordingly.
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Review Trade Association Activities: Ensure participation in industry groups doesn’t inadvertently lead to anti-competitive conduct.
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Establish Reporting Procedures: Create protected channels for staff to report potential competition law concerns without fear of reprisal.
How NB Commercial Law Can Help You
At NB Commercial Law, we specialize in guiding Queensland businesses through the complexities of competition law. Our experienced team can help your business by:
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Conducting thorough competition law risk assessments tailored to your industry.
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Designing and implementing compliance programs to address the new penalty regime.
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Providing training on competition law obligations for directors, executives, and staff.
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Reviewing contracts, pricing strategies, and distribution arrangements for compliance.
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Representing your business in ACCC investigations and enforcement proceedings.
Don’t Wait for a Claim — Protect Your Business Today
The time to reassess your competition law compliance is now, before your business faces regulatory scrutiny. Contact NB Commercial Law today to safeguard your operations against record-breaking penalties and ensure compliance in this new era of competition law enforcement.