Western Australia’s former reputation as a place of fast money and sharp business practices may well have been consigned to the shredder, if the mood at a recent Property Council breakfast is any indication.
Western Australia’s former reputation as a place of fast money and sharp business practices may well have been consigned to the shredder, if the mood at a recent Property Council breakfast is any indication.
Instead of the suspicions of decades past, “all is travelling well in WA now from a Trade Practices point of view”, according to Australian Competition and Consumer Commission (ACCC) commissioner John Martin.
“In the ’80s and into the ’90s, Perth did have a reputation for things like WA Inc, but everything is going very well now and the pattern of growth is steady and progressive, which reflects well,” Mr Martin said.
And just as Perth has stepped back from unacceptable market beha-viour, the ACCC has also stepped back from enforcement.
“[Former ACCC chairman] Allan Fels made the ACCC and the Trade Practices Act famous within business. He did make it a bit scary, and we are trying to lower the temperature,” Mr Martin said.
“The Trade Practices Act that we enforce makes the ACCC somewhat more of an umpire in the marketplace, but in enforcing the act, we do still take matters seriously.
“It is important to note that the ACCC is not aiming to punish business, but if a business uses its size or market power to bully another party, we have the power to step in.”
The ACCC enforces three main areas: anti-competitive behaviour; misleading and deceptive conduct; and unconscionable conduct.
Mr Martin said the Federal Government had recently announced the extension of unconscionable conduct provisions to cover a greater range of transactions by increasing its threshold from $3 million to $10 million.
This made the provisions more available to a large number of small business, as well as changes outlawing the use of unilateral variation clauses in contracts.
He emphasised that the Trade Practices Act was not just a burden on business, but was also there to protect business.
Encouraging the states to examine their retail tenancies legislation, Mr Martin said it would be a positive step if the industry looked at a national code.
“We get a lot of complaints about retail tenancies and the states have been progressively reviewing their legislation, but the industry needs to pick up the ball,” he told the Property Council breakfast forum.
“With the property sector generally, there were some practices going on which were giving the real estate industry a bad name, and the industry itself was one of the loudest voices wanting us to go in and do something about it.
“Reputation and confidence are very important to the way the market sits and a lot of damage can be done if spruikers aren’t put out of business.
“Irrespective of what state and territory law says, real estate agents still don’t have carte blanche – if what they are doing negates the Trade Practices Act, then the ACCC still has the ability to come in.”
Phillips Fox sponsored Commissioner Martin’s trip to WA and property partner Peter Beekink said there could be an issue with WA law because in this state, vendor bids are allowed at auction, something that ran counter to the Trade Practices Act.
“An area the ACCC has had a role in WA in has been in relation to unconscionable conduct,” Mr Beekink said.
“But the area took a big blow when the ACCC took the owners of Farrington Fayre shopping centre to the High Court and lost, with the court holding that robust negotiations are not necessarily unconscionable conduct.”
He said that, ultimately, uniform retail legislation would occur, but that it would take a while as there were different issues between the states, and that they remained dogmatic about retaining separate legislation.
