The chair of the Australian Competition and Consumer Commission (ACCC), Rod Sims, is in the final year of his five-year tenure. Sims continues to be well respected and highly regarded. He is eligible for reappointment for a second term of up to 5 years and was reported in the media to be seeking reappointment. One hopes and assumes this will occur. The ACCC itself continues to be consistently recognised as one of the leading competition regulators in the world.
The ACCC remains under budgetary pressure and has reduced its staffing levels in recent years. Sims assumed the CEO or ‘Agency Head’ role during 2014 as part of these efficiency measures. While changes in the ACCC’s approach are not necessarily attributable to Sims alone, we have seen the ACCC continue to take a tough and strategic approach to enforcement and to emphasise high quality and principled decision-making.
When undertaking enforcement, the ACCC generally prefers undertakings or administrative resolutions. Litigation is reserved for the most troubling conduct. One of Sims’ early comments was that he was prepared to litigate more frequently, even if success was not assured, consistent with the ACCC’s strategic priorities. In the last financial year, the ACCC was involved in 59 separate proceedings and initiated 21 new proceedings. We expect the ACCC’s tough yet selective enforcement approach to continue over 2016.
The ACCC’s emphasis on principled decision-making has been reinforced by the appointment in late 2015 of the ACCC’s first chief economist, Dr Graeme Woodbridge. By doing so, the ACCC has signalled that it intends sound economics will continue to underpin ACCC decisions; promoting greater transparency and predictability. This will continue to complement the ACCC’s focus in recent years in ensuring its decisions are pragmatic and commercially nuanced.
The government provided the ACCC with additional resources to establish an Agricultural Enforcement and Engagement Unit last year following recommendations in the government's white paper on agricultural competitiveness. In February, Sims identified that agriculture will be given enforcement priority in 2016 starting with a sectoral market study. On 24 February 2016, the ACCC appointed Mick Keogh as a new Commissioner, with a focus on competition and consumer issues in the agriculture sector. This suggests that we can expect to see greater enforcement activity in this sector than has been the case historically.